UK ministers barred from using emergency funds for pay rises ahead of Budget to control spending.

The UK Treasury has barred Cabinet ministers from using emergency funds for public sector pay rises ahead of the November 26 Budget, requiring departments to exhaust all savings before accessing the reserve. Chief Secretary James Murray emphasized strict cost controls, demanding departments repay any borrowed funds and prioritize efficiency. The move, part of Chancellor Rachel Reeves’ fiscal discipline efforts, aims to meet borrowing rules and avoid tax hikes amid a £22 billion overspend. While revised data showed borrowing of £81.8 billion for 2024-25—£2 billion lower than estimated—actual borrowing remains above OBR forecasts, raising concerns about future tax increases. Departments must now fund pay rises within existing budgets and demonstrate they’ve made offsetting cuts.