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Recently, Chancellor of the Exchequer Rachel Reeves MP presented the 2025 Autumn Budget at the UK Parliament, outlining the government’s economic plans that will take effect from April 2026.
While this budget contains some positive steps forward for young women and girls across the UK, it also reveals concerning gaps and missed opportunities. Here’s what stands out.
The removal of the two-child limit on Universal Credit from April 2026 is genuinely welcome news. This change is projected to lift 450,000 children out of poverty across the UK by 2029/30. This is a critical intervention for Scotland, where 23% of children were living in poverty in 2021-24.
This change puts an end to a policy responsible for deepening women’s financial inequality. Child poverty and women’s poverty are inextricably linked, as women continue to shoulder the majority of unpaid care work in households and communities. Young women raising multiple children, and girls growing up in poverty with siblings, will both benefit from this change.
The caring responsibilities that predominantly fall to women are a key driver of the gender pay gap. Now that the Scottish Government no longer needs to mitigate the devastating consequences of this cap, we hope to see them develop future policies that take a gendered approach to tackling child poverty and provide adequate support for the true costs of raising children, as this is the only way to address these interconnected problems.
The government is committing over £1.5 billion across the spending review period to the Youth Guarantee and the Growth and Skills Levy. This aims to address elevated rates of young people not in education, employment or training (NEET), ensuring all 16-24 year olds have access to support they need to earn or learn.
While we welcome this investment, we are concerned it isn’t being targeted to those who need support most, nor does it specifically address the barriers young women face. Without a gendered lens, this funding risks missing the young women who need it most.
The Budget includes measures to reduce household energy bills by around £150 on average from April 2026, with the government funding 75% of the domestic cost of the legacy Renewables Obligation for three years.
Our research shows young women are disproportionately affected by the cost-of-living crisis and, according to the Scottish Women’s Budget Group survey, energy costs are the second-highest single expense making women worse off. This relief is important.
However, the removal of the Energy Company Obligation—which required large energy companies to help low-income and vulnerable households improve energy efficiency and upgrade heating systems—represents a step backwards in effectively tackling climate change.
According to the budget, from April 2026, the National Living Wage for over-21s will increase by 4.1% to £12.71 per hour. The minimum wage for 18-20 year olds will rise by 8.5% to £10.85, and for 16-17 year olds and apprentices by 6.0% to £8.00.
For young women, who are more likely to be in lower-paid work, this increase matters. However, this raise falls short when we consider the ongoing cost of living crisis and inflation rates. At The Young Women’s Movement, we believe that having different pay bands based on age is fundamentally unfair and an insidious form of age discrimination. Everyone, regardless of age, should receive a Real Living Wage that reflects the work they do, not their age.
Tackling the gender pay gap that contributes to women’s higher levels of poverty requires a recognition of the skilled, essential nature of their work. We call for fair pay for frontline social care and childcare workers – roles carried out primarily by women.
This budget positions Scotland as an AI Growth Zone to attract investment through AI infrastructure, such as data centres, and position itself as a leader in artificial intelligence technology.
While the government continues to invest in AI as a financial asset, it’s not doing enough to protect young women and girls from AI-related harms. As our recent Guide to AI resource demonstrates, AI and tech-related harms are seriously affecting young women and girls. AI must not be viewed solely as a financial opportunity; it’s a social actor in our lives that requires robust regulation.
Additionally, data centres pose serious environmental risks. The enormous water usage required threatens water security of Scottish communities, as we’ve already seen in other part of the UK and internationally. This environmental threat undermines the future of young women and their communities in Scotland.
We expect any Scottish Government plans to implement AI growth will meaningfully address the digital violence women face and confront the climate emergency.
What’s absent from this budget speaks volumes. There is not significant investment in essential infrastructure that would directly tackle gender inequality, such as women’s services and youth organisations.
The third sector, despite increasingly challenging financial circumstances, continues to support women and girls and champion their rights. As the UK Government has not invested sufficiently in social infrastructure that benefits young women, the responsibility now falls to the Scottish Government to use its 2026/27 budget wisely.
An opportunity to do better
As a result of UK Budget 2025 decisions, devolved governments are receiving an additional £1.7 billion, with the Scottish Government receiving £820 million, the largest spending review settlement since devolution in 1998.
The Young Women’s Movement urges the Scottish Government to use these funds to address pressing issues for young women and girls in Scotland through its devolved powers, investing in young women’s priorities as set out in the Young Women Demand manifesto:
The UK Autumn Budget 2025 offers some progress, but it falls short of the transformational investment young women and girls in Scotland need. As we await the Scottish Government’s budget decisions, we’ll be watching closely to see whether they seize this opportunity to prioritise young women and girls.
Mar is Research & Policy Lead at The Young Women’s Movement.
She leads on participatory research projects and delivers policy consultations and briefings to ensure young women’s voices are meaningfully heard in decision-making spaces.
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