A Perspective from GW Accountants

The 2025 Budget, announced on 26 November 2025, is more than a collection of tax and spending measures — it also sets the economic and social backdrop in which every UK business operates. For employers, this means thinking carefully about employee welfare, financial wellbeing, and support systems. In a year of economic pressures and policy shifts, the businesses that prioritise staff welfare will likely be those that emerge stronger and more resilient. https://www.gov.uk/government/topical-events/budget-2025

At GW Accountants, we believe business health isn’t just about profits — it’s about people. Here’s what the 2025 Budget means for workplace welfare and how you might respond to build a supportive, sustainable company culture.

1. The 2025 Budget Context: A Nation Investing — and Adjusting

The 2025 Budget comes alongside a major government spending plan under the Spending Review 2025. Over the next five years, the government is significantly increasing both day-to-day (resource) and capital spending — signalling commitments to public services, infrastructure, health, education, defence and more. 

At the same time, the government faces a “fiscal gap,” creating pressure to raise revenues — which means tax changes, benefit reforms, and careful scrutiny of welfare spending. 

This dual reality — more public investment, but also tighter fiscal constraints — shapes the backdrop against which businesses must consider their internal welfare and wellbeing strategies. https://commonslibrary.parliament.uk/research-briefings/cbp-10280/

2. Why Employee Welfare & Wellbeing Should Be a Business Priority

When households face financial strain, uncertainty around public services, or changes to welfare eligibility — as the 2025 Budget implies — the stress often filters through to the workplace.

Employees who are worried about finances, living costs, health or family responsibilities may struggle with focus, energy, or mental wellbeing. Over time, this can lead to:

• Lower productivity
  
• Increased absenteeism or presenteeism
  
• Reduced engagement and motivation
  
• Higher staff turnover
  
• Recruitment challenges
  

Given this, companies that proactively invest in well-being support, flexible working, and financial wellness programmes are not just doing right by staff — they are protecting their operations and building long-term stability.

3. What in the 2025 Budget Matters for Employees’ Financial & Social Wellbeing

Here are key aspects from the Budget and broader fiscal policy that will affect employees — and by extension, businesses that employ them.

🔹 Public Spending Increases: Health, Social Care and Public Services

• According to the Spending Review, resource (day-to-day) public spending will rise, with especially large increases for health and social care. House of Commons Library+1
  
• This could — over time — improve access to healthcare, reduce waiting times, and ease pressure on families dependent on public services. For employees, that reduces stress, and for employers, that means fewer health-related absences and more stable wellbeing outcomes.
  

🔹 Pressure on Welfare Budget & Fiscal Constraints

• The Budget comes against a backdrop of overall pressure on public finances — with the government signalling the need to balance welfare support against revenue constraints. House of Commons Library+2Research Briefings+2
  
• In uncertain times, the reliability or speed of some welfare services may remain a concern — meaning employers may still need to fill gaps when it comes to employee support and wellbeing.
  

🔹 Personal and Household Financial Strain

• With revenues likely to be under pressure and wider economic challenges, families may continue to face cost-of-living stress.
  
• As a result, employees might benefit from financial wellness support, such as budgeting advice, pension guidance, or income-protection counselling — especially for those on lower or variable incomes.
  

4. What This Means for Employers — Risk and Opportunity

The post-Budget environment offers both challenges and opportunities for businesses thinking about welfare and wellbeing.

⚠️ Risks to Be Mindful Of

• Employee stress and burnout — as personal finances remain squeezed or public-service delays persist.
  
• Reduced morale or engagement — if staff feel financially insecure or uncertain about support options.
  
• Higher turnover or recruitment difficulty — employees may look for employers offering stronger welfare or support.
  
• Operational disruption — sickness, absenteeism, or reduced productivity.
  

✅ Strategic Opportunities for Employers

• Forge loyalty and trust — businesses that offer wellbeing support, even modestly, tend to maintain higher retention and morale.
  
• Stand out in recruitment — as competition increases, employee welfare becomes a meaningful differentiator.
  
• Boost productivity and efficiency — healthy, supported employees are more focused, engaged, and innovative.
  
• Demonstrate social responsibility — aligning with the wider societal need for support during economic change.
  

5. Recommended Employer Actions: Building Good Welfare & Wellbeing Practices

Based on the 2025 Budget realities, here are some practical steps we recommend at GW Accountants:

🔸 A. Review and Expand Employee Welfare Policies

• Reassess sick-leave, family-leave and flexible working policies in light of increased pressures on households and public services.
  
• Consider implementing or strengthening Employee Assistance Programmes (EAPs) — offering counselling, mental health support, financial advice.
  
• Promote work–life balance: encourage flexible hours, remote working, or hybrid arrangements where possible.
  

🔸 B. Offer Financial Wellbeing Support

• Provide staff with access to financial advice — budgeting, debt counselling, pension planning.
  
• Communicate clearly about any pension-related changes (especially if employees use salary-sacrifice schemes).
  
• Offer guidance on welfare/benefits eligibility, where relevant (but clear about employer vs state responsibilities).
  

🔸 C. Prioritise Mental and Physical Health Support

• Consider subsidised private health insurance or health-care top-ups (where viable).
  
• Offer mental health first-aider training or wellbeing check-ins.
  
• Encourage regular breaks, exercise, and “wellbeing days” to reduce burnout.
  

🔸 D. Foster a Supportive and Transparent Company Culture

• Promote open discussion about financial stress, wellbeing and support needs.
  
• Provide training for managers to recognise signs of distress, and know how to respond sensitively.
  
• Regularly review staff feedback to adapt policies to changing needs.
  

🔸 E. Work with Professionals for Tailored Advice

• Engage with accountants or financial advisors (like GW Accountants!) to help staff with tax, pension and financial-planning queries.
  
• Consider offering group “financial wellbeing sessions” — covering budgeting, savings, pension, and income planning.
  

6. Why Investing in Employee Welfare Is Good Business

It’s often said that “look after your people and they’ll look after your business”. The 2025 Budget underlines why this approach is more relevant than ever.

• Costs of poor wellbeing are often hidden — sick pay, lost productivity, recruitment/training, turnover. Proper welfare strategies reduce these costs long-term.
  
• Morale and retention matter more when households are under pressure — when living costs or welfare support are uncertain, employees value employers who offer stability.
  
• A healthier workforce is more productive — mental and physical wellbeing directly impact performance, creativity, and reliability.
  
• Reputation and employer brand count — in competitive labour markets, companies that genuinely care about employee welfare tend to attract better talent.
  

For many small and medium-sized businesses, the difference between survival and growth may hinge on how well they support their people through economic headwinds.

7. What GW Accountants Recommends — In Summary

As we move into the aftermath of the 2025 Budget, we encourage our business clients to:

• Audit current HR and wellbeing policies — consider what’s working, what’s missing.
  
• Introduce or strengthen financial-wellbeing offerings (advice, pension guidance, budgeting, support).
  
• Think about mental health and flexible working as strategic priorities, not optional extras.
  
• Encourage open communication and transparency — let staff know they’re supported.
  
• Work with accountants or advisors to understand pension, benefits and tax implications for both employer and employee.
  

At GW Accountants, we’re ready to help. Whether it’s reviewing payroll, advising on pension or salary-sacrifice changes, or helping craft a tailored wellbeing programme — we’re with you.

8. Final Thoughts

The 2025 UK Budget is a major fiscal moment — and its ripple effects will be felt not only in government coffers, but in households, workplaces and communities across the country. For businesses, this means navigating uncertainty — but also recognising opportunity.

Prioritising staff welfare and wellbeing is not just ethically commendable. In 2026 and beyond, it may well be a key part of resilience and long-term success.

If you’d like help interpreting how Budget changes affect your business or staff — or if you want to design a pragmatic welfare/wellbeing plan — do get in touch.