Industry reacts to 2025 Autumn Budget

November 26, 2025

The Chancellor of the Exchequer, Rachel Reeves, delivered the 2025 Autumn Budget in the House of Commons on 26 November. Big talking points for the industry included fully funded apprenticeships for under-25s, a new EV pay-per-mile tax, the scrapping of the Energy Company Obligation (ECO) scheme, and investment of £725 million for the Growth and Skills Levy.

Here, we take a look at some of the industry’s responses so far…

Jump to:

• ECA
• JIB
• IET
• JTL
• BEAMA
• ENGINEERINGUK
• FMB
• REA
• MCS

ECA

Today’s Autumn Budget brings some relief and new challenges for employers in the electrical sector.

The Chancellor announced £725 million for the Growth and Skills Levy, aimed at supporting apprenticeships for young people, including a change to fully fund SME apprenticeships for eligible people under 25. This announcement equates to £1,150 per apprentice aged 22-24, but the reality is that few new electrical apprentices start within this age group. While any additional apprentice support will be welcomed by ECA’s Member businesses, it does not go far enough.

Andrew Eldred, Deputy CEO of ECA, commented:

“The recent 6% uplift in the Apprentice Minimum Wage – now nearly 50% higher than in 2024 – means the cost of employing apprentices has soared. For many SMEs, it now takes an average of a year longer to see any return on their investment in training new talent.

“This level of government-imposed wage inflation is unsustainable without urgent counter-measures, through more generous employer incentive payments and/or tax credits for businesses that train.”

ECA has had little real opportunity to input into the Government’s plans for simplifying the apprenticeship system, but is keen to work with Government to alleviate administrative and regulatory burdens for employers, especially SMEs.

EV road tax

Many ECA Member firms have pioneered the use of electric vans and cars, with electrical contractors often travelling long distances for work. From 2028, electric cars and plug-in hybrids will be subject to a road tax based on mileage, though electric vans will initially be excluded. The OBR estimates that an electric car driver travelling 8,500 miles a year will pay £255 – roughly half the rate of fuel duty tax paid by petrol and diesel drivers. As we get closer to the 2030 ban on the sales of new petrol and diesel cars, this is disappointing for firms expecting long term savings on transport.

For those yet to invest in electric vehicles, today’s Budget has increased and extended the EV car grant to prevent the transition to EVs from slowing down.

Energy bills

ECA welcomes the removal of the ECO scheme and the Renewals Obligation levy on household bills, which will help reduce the high cost of electricity for consumers, while retaining government support for renewables. The UK currently has the highest electricity prices in Europe, with electricity taxed at four times the rate of gas. ECA will continue to call for a review of energy taxation to bring gas and electricity to parity. Further reductions in electricity prices are essential for the widespread adoption of electric transport, heating and energy – necessary steps to reduce carbon emissions.

ECA’s Head of External Affairs, Jane Dawson, added:

“Without bolder action from Government, the UK risks falling behind net zero delivery, missing investment opportunities, and limiting economic growth.”

JIB

The JIB has reviewed the measures announced in the Budget which will affect the electrotechnical and wider construction industry.

The Office for Budget Responsibility (OBR) has confirmed that economic growth is forecast to average 1.5% over the next five years, 0.3% lower than projected in March. For the electrotechnical sector stability is key, as companies seek to balance inflationary pressures and tight margins. It is also crucial to support the long-term investment in skills and workforce development required to achieve major strategic programmes – such as decarbonisation, building safety and digitalisation.

Minimum wage rise reinforces the value of structured apprenticeships

From 1 April 2026, the Government will increase the National Minimum Wage (NMW) to:

• £12.71 per hour for workers aged 21 and over
• £10.85 for 18-20-year-olds
• £8.00 for 16-17-year-olds and statutory apprentices

Through the JIB, the ECA and Unite the Union negotiated a three-year wage deal, in June 2025, for the years 2026-2028. This has apprentice rates for Stage 1 at £8.16 (National Standard) and £9.14 (London) which is above the NMW. JIB members paying in line with the Agreement will be compliant when rates increase in April 2026. Employers must consider those aged 19 years and over, who are in the second year of their apprenticeship, and apply the higher of the JIB stage rates or the NMW for their age.

Unlike the flat minimum wage model, which risks early drop out, the JIB’s staged approach continues to support apprentice retention, training quality and long-term career progression.

Jay Parmar, JIB CEO, said:

“The Government’s uplift to the National Minimum Wage for apprentices will be seen as positive by many, but the JIB model already goes further in rewarding competence, motivation and completion. Investing properly in those joining the industry is essential if we are to build the skilled, safe and future-ready workforce the country needs.”

£820m Youth Guarantee – early career pathways

The Chancellor also announced £820m of funding over the next three years to deliver a new Youth Guarantee, which builds on proposals first set out in November. Under the initiative, all those aged 18-21 years in England will be guaranteed access to an apprenticeship, education, training or employment support.

Co-investment payments – which small and medium enterprises (SMEs) have had to make when they hire an apprentice – were scrapped for those under the age of 22 in 2024. This cost has now also been removed for those hiring an apprentice aged 22-24.

We welcome the renewed focus on youth access to high-quality technical and vocational routes but stress that this must be matched by investment in completion, competence and employment standards.

JIB COO, Andy Reakes, said:

“Creating opportunities for young people to start an apprenticeship is only the first step. Completion rates, real employment, vocational training opportunities, fair pay and progression are what ultimately deliver the competent workforce the UK depends on.”

EV mileage-based charge from 2028

The OBR confirmed that a new mileage-based charge on electric and plug-in hybrid vehicles will take effect from April 2028. This will be set at around half the current fuel duty level paid by petrol vehicles, generating around £1.4bn per year. As the use of electric vehicles in the electrotechnical sector is widespread, the JIB will monitor how the scheme is implemented and the impact on employers, travelling operatives, fleet management and project costs.

Infrastructure and planning

A further £100 million in funding, on top of the £400 million announced in June, will be invested to support EV charging infrastructure. In addition, £100 million of resource funding will be allocated to local authorities and public bodies to support the training of specialist staff to accelerate the rollout of public charge points. As a partner in The Electrotechnical Skills Partnership (TESP) the JIB endorses the Electrician Plus model which promotes the upskilling of qualified electricians in new technologies.

The budget reaffirms the Government’s commitment to delivering the flagship Planning and Infrastructure Bill with £48 million of additional funding to boost capacity in the planning system.

Devolved and regional investment to support growth

Chancellor Reeves confirmed £13bn of flexible investment for seven English mayors, alongside direct allocations of:

• £370m for Northern Ireland
• £505m for Wales
• £820m for Scotland

£1.3 billion of the new National Housing Delivery Fund will also be devolved across Greater Manchester, Greater London, Liverpool City Region, the North East, South Yorkshire, West Midlands and West Yorkshire.

We recognise the vital role of regional investment in supporting local infrastructure, public sector building programmes and skills initiatives – all of which are critical to demand for electrical and building services expertise.

Louisa Weinstein, JIB Head of Industrial Relations, said:

“This focus on regional investment to support growth aligns with our aims. Through our network of Regional Boards and Forums we communicate with metro mayors, combined authorities and LSIPs to promote the use of JIB members and explain what this represents – in terms of good employment standards.”

Commitment to competence and workforce development

Despite softer growth expectations, demand for competent electrical and building services professionals remains strong across domestic, commercial and industrial markets.

Jay Parmar, JIB CEO, concluded:

“The UK’s transition to net zero and the modernisation of building infrastructure hinge on a skilled and fairly-rewarded workforce. The JIB and ECS will continue to champion competence, quality and fair employment to support the long-term health of the industry.”

IET

As Chancellor of the Exchequer Rachel Reeves announces the Autumn Budget, experts from the Institution of Engineering and Technology (IET) share their thoughts.

Free apprenticeships for under-25s could help tackle skills gap

Dr Graham Herries, Chair of the IET’s Policy Oversight Committee, said:

“Our recent Skills Survey shows that large engineering organisations are more likely than SMEs to report strong apprenticeship outcomes. Among large employers, 43% said over half of their apprentices completed training (compared to 32% of SMEs), and 48% said those apprentices remained employed after training (versus 28% for SMEs).

“Whilst it’s welcome news that training for apprentices under-25 will be fully funded for SMEs, Government must work with businesses and local training providers to ensure that the new Growth and Skills Levy provides young apprentices and SMEs with the support they need to complete their training.

“A stable business environment will also be critical for SMEs to have the certainty they need to be able to offer secure long-term jobs to the young people they spend time training.”

Investment in EV infrastructure key to decarbonisation

James Bamborough, Sustainability and Net Zero Policy Manager at the IET, said:

“EVs represent one of the simplest wins for decarbonisation – but only if incentives and infrastructure keep pace. We welcome the focus on charging infrastructure and the extension of the grant scheme until 2030.

“EV adoption in the UK faces a complex reality, with infrastructure maturity varying widely across regions. There is no one-size-fits-all approach – different boroughs and cities operate under different rules and policies, creating significant barriers to uptake.

“For those unable to charge at home, costs are higher, and options are limited. Expanding reliable street charging must therefore remain a key priority.”

Cuts to energy bills welcomed, but efficiency must be prioritised

James Bamborough, Sustainability and Net Zero Policy Manager at the IET, said:

“Today’s Budget brings welcome news that household energy bills will be cut through scrapping levies on household bills such as the Energy Company Obligation, supporting those who need it most. However, to tackle the energy crisis, we can’t just focus on energy supply, but also on reducing demand. Improving energy efficiency, particularly through targeted home insulation and retrofitting, is the best way to lower consumption and costs. We need to develop the capability for improving building efficiency. Above all, the energy sector needs long-term stability with predictable policy and taxation.”

Lack of cyber support for SMEs raises competitiveness concerns

Jayne Black, Digital Futures Policy Manager at the IET, said:

“The Government has missed the opportunity to provide much needed support for SMEs alongside the Cyber Security and Resilience Bill. Businesses recognise that cyber skills are critical for success with 38% citing cyber skills as the most important and 2/3 public stating that Government needs to prioritise cyber security. Tax breaks would have bolstered SMEs to invest in reskilling their workforce and increase cyber defences. Large and small enterprises in supply chains face a clear and persistent threat from hackers, in the UK and globally, which presents vulnerabilities to larger companies.

“This severely impacts the economy in the event of a breach. Supply chains can be broken by the weakest link. What the Government now needs to look to, is ensuring that response plans in the event of an attack are prioritised just as much as prevention in the Cyber Security and Resilience Bill.”

Dr Graham Herries, Chair of the IET’s Policy Oversight Committee, added:

“Maintaining international advantage in innovation and technology is not a given, in fact the UK faces fierce competition globally. Although it benefits from a good basis of intellectual capability, the ecosystem must be right – including infrastructure, keeping down rising costs for businesses and ensuring the UK is an attractive place to invest. Without strengthening the entire entrepreneurial supply chain, the UK risks falling behind. We look forward to contributing to the review into strengthening the role of entrepreneurs in the UK.”

JTL

As the industry digests the latest Budget, JTL reflects upon what it means for employers, apprentices, and the UK skills pipeline.

Chris Claydon, Chief Executive of JTL, said:

“We welcome the Budget’s recognition of the vital role skilled trades play in driving UK growth and net zero ambitions. Fully funded apprenticeships for under-25s and extended support for SMEs are positive steps that give employers confidence to invest in the next generation. It’s also encouraging to see investment in construction and infrastructure, but this must be matched by a skills system that enables businesses to build the workforce needed.

“Rising wage costs and unchanged funding bands mean financial pressures remain, so the real test will be the decisions employers make in the months ahead. As demand grows across housing, retrofit and clean energy, apprenticeships will be critical to meeting future workforce needs. JTL stands ready to work with Government and industry to ensure the skills pipeline grows in step with the needs of the economy.”

BEAMA

Yselkla Farmer, CEO of BEAMA, commented:

“We welcome the Government’s focus upon driving down energy bills for UK households, but further measures are needed to ensure that we are creating a sustainable energy system by supporting investment from consumers and businesses with credible, delivery-focused policies that bring the public along with us.

“With much still to do to achieve Clean Power by 2030 and a need to accelerate progress towards the Net Zero 2050 requirement, now is not the time to introduce uncertainty. The scrapping of the Energy Company Obligation and other domestic electricity levies will deliver immediate savings to energy bills. However, without a clear policy on how this essential funding will be replaced within the twice-delayed Warm Homes Plan, the Budget has added further policy confusion as we work towards Clean Power 2030.

“Manufacturers need policy consistency over time and tangible delivery plans to encourage investment, and Government should understand this investment cannot appear overnight. Businesses also continue to struggle with energy and hiring costs which have not been materially improved by today’s Budget.

“Our members enthusiastically welcomed the action plans for Clean Power, Industrial Strategy and Green Jobs, demonstrating the positive sentiment that Government can set. But manufacturers quickly need a clear and consistent policy to ensure short term relief is followed by long term improvements that will bring benefits to consumers for decades to come.”

Energy bills and investment

“Our members have consistently supported policies to reduce electricity costs as a top priority to help consumers and encourage investment in energy saving technologies. As such the bill savings announced in today’s Budget are a welcome short-term measure.

“However, while the Government has announced an additional £1.5bn capital spending to the Warm Homes Plan pot, industry will want to receive clarity as soon as possible on how this will be raised and spent following the scrappage of the Energy Company Obligation (ECO).

“Uncertainty remains over the publication of the delayed Warm Homes Plan, Future Homes Standard, and longer term structural changes to electricity prices. These policies are a great opportunity to stimulate consumer and business investment, economic growth and accelerated decarbonisation.

“We will be supporting the Government to accelerate policy development and decisions to boost industry confidence and press ahead with developing an energy system fit for the present and future.”

Electric vehicles

“The Chancellor’s proposal to introduce a 3p per mile electric vehicle excise duty (VED) risks sending the wrong signal at a crucial time for the UK’s transport transition.

“While it is inevitable that electric vehicle drivers will eventually need to contribute more to make up for the reduced fuel duty revenue from ICE vehicles, now is not the right time to discourage EV ownership. While only 5% of UK vehicles are electric according to the SMMT, the UK has a long way to go to reach its 2035 EV adoption target.

“Similar schemes have reduced EV demand, undercutting the business case for continued investment in charging infrastructure rollout.

“Using revenue raised from VED to fund road repairs caused by other vehicles sends the wrong message, supporting misinformation and incorrect claims that EVs are damaging UK roads.

“Meanwhile the positive announcement regarding a reduction in domestic energy bills will further increase the disparity between those who can charge at home and those who rely solely on the public charging network. BEAMA will urgently be making the case for a more balanced approach within the upcoming EV charging price review.”

ENGINEERINGUK

Today the Treasury published the Autumn Budget. EngineeringUK reflects on what this means for science, technology, engineering and maths (STEM) education, and for pathways into engineering and technology careers.

Beatrice Barleon, Head of Policy and Public Affairs, EngineeringUK, said:

“The Autumn Budget arrived at a pivotal moment for skills reform, with the recent post-16 skills white paper highlighting the declining provision of apprenticeships for young people, including in key Industrial Strategy growth sectors.

“The Chancellor’s decision to fully fund SME apprenticeships for young people under 25 – up from age 22 currently – will help to break down barriers to SME participation in apprenticeships. However, Government must go further with additional wraparound support for SMEs.

“We also welcome the commitment to invest an additional £725m in the Growth and Skills Levy over the next five years, and look forward to seeing further detail ahead of April 2026.

“The Government must ensure this funding uplift is adequately targeted at young people, and at filling critical skills gaps within sectors with the greatest employment demand such as engineering and technology. Many of these are likely to be entry-level apprenticeships. Skills England are forecasting that more than a third (34%) of the increased employment demand in the IS-8 sectors over the next decade will be in Levels 2 and 3 occupations.

“To deliver a resilient engineering and technology workforce in the long-term, Government must make sure this investment is matched by an equal scale of ambition in the pre-18 education system. It should adopt a joined-up approach to talent development across pre- and post-18 by investing in high-quality STEM education for young people. This should be delivered both through lessons and STEM outreach activities, and ensure young people are informed and inspired through modern careers advice and guidance in schools.”

FMB

The Federation of Master Builders (FMB) has welcomed measures in today’s Autumn Budget, including pulling back on the landfill tax, £48 million to boost planning capacity, and free apprenticeship training for under-25s in SMEs. However, the previously announced wage rises will hit small businesses’ squeezed bottom lines and the lack of action on domestic retrofit and dropping of ECO scheme leaves a gap in how the country will upgrade its old housing stock.

Brian Berry, Chief Executive of the FMB, commented:

“Today’s announcement on landfill tax reform is a big win for small house builders, saving them thousands on new build costs. Alongside this, making apprenticeship training for under-25s in SMEs free from paying in the co-investment sum when hiring under 25s will be a boost, alongside much needed simplification of the apprenticeship application process.

“The £48 million investment to boost planning capacity is a further positive step. Local planning departments are under immense strain, and this funding will help unlock stalled housing projects, but this seems a small sum of money to fix a very big problem. A well-resourced planning system is essential if we are to meet housing targets, and SMEs must be at the heart of delivery. Supporting small builders to get spades in the ground will ensure Britain gets the high-quality homes communities need.

“However, the rise in minimum wage will squeeze bottom lines and the freeze in tax thresholds has the potential to push many builders into a higher tax bracket. It’s also disappointing to see the Chancellor miss the opportunity to back household energy upgrades of any kind, even rolling back on the ECO scheme. Upgrading homes will be vital to keep people warm in winter and cool in summer. This Budget offers welcome steps forward, but overall I can see many builders feeling underwhelmed.”

REA

The Chancellor announced in the Budget that from April 2028, electric car drivers will pay a road charge of 3p per mile, while plug-in hybrid drivers will pay 1.5p per mile, with the rates going up each year with inflation.

REA’s Director of Policy, Frank Gordon, commented:

“The fairest approach would be for all types of vehicles to be included – and this should reflect the environmental impact of their vehicle – in principle, polluters should pay and a higher impact should be reflected in increased costs.”

MCS

Ian Rippin, CEO at MCS, said:

“MCS is disappointed by the Government’s decision to end the Energy Company Obligation (ECO4) in today’s Budget, which will create substantial challenges for businesses, hinder sector growth, and adversely affect some of the most vulnerable households in the country. Government incentives have played an important role in increasing access to home-grown energy for households across the UK, including under ECO4. With ECO4 now set to end on 31 March 2026 and the Warm Homes Plan not yet published, this lack of continuity in support is likely to create substantial challenges for businesses, hinder sector growth, and adversely affect households that would rely on the scheme. That’s why in our consultation response earlier this year, MCS made the case to extend ECO4 and avoid any hiatus that will cause this kind of damage.

“While we await clarity over the Warm Homes Plan, MCS hopes to see a robust, fully funded offer to ensure that every household that was eligible under ECO4 can continue to access low-carbon energy and that confidence in home-grown energy continues to increase. ECO4 put financial responsibility for the installation of clean heat mechanisms on energy suppliers as a measure to support those in need to be able to access low-carbon technologies and reduce their bills. It is these households who will ultimately lose out. However, the cuts announced today won’t just impact households, it will impact industry growth and countless businesses across the country, including the MCS certified installers delivering installations under ECO4.

“There have been around 20,000 certified solar PV and 10,000 certified heat pump installations under ECO4 since February 2025 alone, showing that the grant has supported wider market adoption of low-carbon technologies as intended. Nearly 400 MCS certified installers are delivering work under ECO4 and will be greatly worried by today’s announcement and the impact it will have on their business.

“While parts of the industry are left with significant uncertainty after today’s Budget, MCS is pleased that the Boiler Upgrade Scheme (BUS) has not been impacted, despite unhelpful speculation in recent weeks that risked undermining the confidence in home-grown energy that MCS and the wider industry have long been building. Greater certainty over the BUS, which we hope to see more of in the upcoming Warm Homes Plan, will be welcomed not only by consumers, but by the 1,200 MCS certified installers delivering quality installations using the grant.

“As the intended sole certification scheme for clean heat measures under the Boiler Upgrade Scheme (BUS), Warm Homes: Social Housing Fund (WH:SHF), Warm Homes: Local Grant (WH:LG), and the Clean Heat Market Mechanism (CHMM), MCS looks forward to continue to support the deployment of clean heat measures across all UK under government schemes.”