# John Healey's Budget Fixes

> Chancellor John Healey reverses savings account rules after flawed tax plans.
- Title: John Healey's Budget Fixes · MoneyWeek | Shortify
- Summary: Chancellor John Healey reverses savings account rules after flawed tax plans. John Healey reversed cash savings account limits to address loopholes in…
- Keywords: john healey, budget, savings account, cash isas, tax policy, corporation tax, gilts market, early election, MoneyWeek
- Source: MoneyWeek — https://moneyweek.com/economy/budget/the-consequences-of-john-healeys-first-budget
- Published: 2026-11-07T08:00:00+00:00
- Read time: 1 min
- Topics: john healey, budget, savings account, cash isas, tax policy, corporation tax, gilts market, early election
## First Budget U-turn
John Healey reversed cash savings account limits from £12,000 to £20,000.

> One of the most telling items in John Healey's first Budget as chancellor was the U-turn on the proposal in the last Budget to reduce the limit on cash individual savings accounts (ISAs) from £20,000 to £12,000
## Money-market fund loophole
Hargreaves Lansdown launched a low-cost money-market fund with 3.95% yield.

> A few days earlier, Hargreaves Lansdown had announced the launch of a low-cost money-market fund with daily access and an expected yield of 3.95%
## Tax loophole consequences
Rachel Reeves' tax changes created a loophole for money-market funds to bypass savings limits.

> When Rachel Reeves, the previous chancellor, reduced the limit on cash ISAs, neither she, nor her team nor the Treasury had realised that money-market funds offered a giant loophole in her proposals
## Pensioner tax confusion
Pensioners with no other income face tax on pension excess over tax-free allowance.

> The prime minister had announced that pensioners with no other income would be taxed on the excess of the state pension over the tax-free allowance without thinking of the complexities this would cause
## Tax revenue shortfall
Corporation tax surcharge increase for banks raised less than £1.5 billion.

> The temporary (15 months) increase in the corporation-tax surcharge for banks from 3% to 6% won't raise an extra £1.5 billion as promised
## Savings tax impact
Savings tax increase by 2% will encourage investors to seek dividend yields.

> The increase in the tax rate on savings and property (but not on dividends) by a further 2% is expected to raise more than £500 million in a full year
## Revenue assumptions
Healey must rely on unexpected growth and next year's spending review for revenue.

> John Healey has to live with the wildly optimistic revenue assumptions of Reeves's Budgets, the money that was allegedly being raised having already been spent
## Gilts market reaction
Gilts market ignored Budget changes to avoid market volatility.

> At least the gilts market took the Budget calmly, ignoring the mass of tinkering intended to camouflage the lack of any major initiatives
## Early election strategy
Calling an early election could allow radical tax changes but risks low support.

> The way out, so the story goes, is to call an early general election while Burnham's honeymoon with the electorate lasts
## Key takeaway

John Healey reversed cash savings account limits to address loopholes in previous tax policies.