Andy Burnham, the Prime Minister of the United Kingdom, has indicated that the government is examining the personal allowance threshold for income tax, while cautioning that altering it carries significant consequences. The statement underscores the administration's cautious approach to potential fiscal policy changes that could affect a broad section of the British population.

Leadership and Policy Focus

Since assuming the role of Prime Minister, Burnham has signalled an intent to scrutinise key elements of the UK's tax framework. The personal allowance — the amount of income an individual can earn before becoming liable for income tax — is a central component of the country's fiscal structure, and any revision to it would have wide-ranging implications for taxpayers and public finances alike.

Key Development

Burnham's remarks reflect a measured stance, acknowledging both the scope of the review and the weight of any prospective decision. The development is expected to attract close attention from economic observers, taxpayer groups, and political stakeholders across the United Kingdom.

UK credit card balances returned to record high levels in April 2026 as spending increased and repayment rates declined, indicating that persistent inflation and energy prices are straining household budgets. According to the FICO UK Credit Card Market Report, average active balances rose 1.3% month-on-month to £1,950, matching the previous peak reached in December 2025. While spending followed typical seasonal patterns with a 10% month-on-month increase to an average of £815, the percentage of overall balance paid fell for the third consecutive month, dropping 1.4% to 32.6%.

The decline in repayment rates has driven up overall debt levels and contributed to a deterioration in payment performance. The percentage of customers missing two payments rose 1.9% month-on-month and 16.3% year-on-year. More critically, the percentage of customers missing three payments increased 6.2% month-on-month and 17.3% year-on-year, marking the most significant annual deterioration across any delinquency category. This shift reverses the improvements in payment behavior observed during 2025.

Balances on accounts with missed payments were higher across all delinquency categories compared to the same month last year. For accounts with one missed payment, the average balance rose 6.7% year-on-year to £2,480. Average balances for accounts with two and three missed payments also increased, reaching £2,855 and £3,325 respectively, representing year-on-year increases of 0.5% and 3.4%.

Another indicator of weakened affordability is the sharp rise in overlimit accounts, which increased 14.1% month-on-month and 4.6% year-on-year. Although the average overlimit spend of £95 was 5.9% lower than in March, it remained 5.5% higher than the previous year. FICO noted that the monthly growth in spending was not sufficient to exceed 2025 levels, suggesting that recent improvements are likely seasonal rather than indicative of stronger financial health.

Key Trend Indicators – UK Cards April 2026

Source: FICO