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Future-dating policy announcements

PolicyEngine UK supports modelling policy changes that have been announced but not yet implemented, or that take effect at a known future date. The mechanism is the same one that handles legislated rate schedules: parameters in policyengine_uk/parameters/ carry a list of values keyed by effective date.

This was originally requested in #636 in the context of the Truss “growth plan” announcements in autumn 2022. Nothing new was needed: parameter values have been keyed by effective date since the model began in 2020, and the parameter files already carry many future-dated rows. This page documents the current usage pattern so that future analyses don’t need to reinvent it.

How it works

Every parameter is a values: map from effective date to value. When the tax-benefit system is built, convert_to_fiscal_year_parameters (policyengine_uk/utils/parameters.py) turns each parameter under gov into one value per model year from 2015 to 2040, where model year 2026 is the fiscal year 6 April 2026 to 5 April 2027:

Example from gov/hmrc/income_tax/allowances/personal_allowance/amount.yaml:

values:
  ...
  2021-04-06:
    value: 12_570
    ...
  2027-04-06:
    value: 12_570
    ...
  2030-04-06:
    value: 12_570
    metadata:
      reference:
        - title: Finance Act 2021 s. 5 (2), as amended by Finance Act 2026 s. 10 (3)
          href: https://www.legislation.gov.uk/ukpga/2026/11/section/10

The 2030-04-06 row records a future-dated decision: the freeze to 2030-31, announced at the 2025 Budget and since enacted by Finance Act 2026 s. 10. The file has no uprating. From the tax year after its last row, policyengine_uk/parameters/gov/hmrc/create_threshold_indexation.py applies the Income Tax Act 2007 s. 57 CPI indexation year by year. So model years 2021 to 2030 return £12,570, and indexation starts in 2031.

Patterns for common cases

Announced but reversed before taking effect

Some announcements are walked back before the effective date. The basic-rate cut to 19%, which the Truss “growth plan” of 23 September 2022 brought forward to April 2023 and which was reversed on 17 October 2022, is the canonical example. To represent this honestly:

  1. When the announcement is made, add the announced value at the announced effective date with a reference to the announcement (for the Truss case, 19% from 6 April 2023).

  2. When it is reversed, remove that row, or replace its value with the value that actually applies from that date (20% from 6 April 2023), and cite the reversal announcement. A new row at the reversal date does not cancel the future row: parameter rows apply from their own dates, so a 20% row dated October 2022 is followed by the 19% row in April 2023, and fiscal-year conversion still gives 19% for 2023.

  3. Keep the announcement history in the row’s references and in version control rather than in a live value.

The baseline then follows what was finally enacted. PolicyEngine UK has no “policy as announced on date X” switch, so to score an announcement as it stood before a reversal, apply it as a reform (see “Dated changes” in the scenarios guide for how dated reforms are annualised, and the excise duties page for duties that keep their calendar dates).

Phased-in or staggered changes

Phased rate changes are a common future-dating pattern. Each phase is a row at its effective date with a separate reference. The Class 1 employee main rate (gov.hmrc.national_insurance.class_1.employee_scale[1].rate, in national_insurance/class_1/employee_scale.yaml) is a good worked example: 13.25% from April 2022 under the Health and Social Care Levy Act 2021 (a temporary 1.25 percentage point rise for 2022-23, ahead of a separate levy due from April 2023), back to 12% for earnings paid from 6 November 2022 under the Health and Social Care Levy (Repeal) Act 2022, then the cuts to 10% in January 2024 and 8% in April 2024. The rate has no fiscal_year_blend, so each model year takes the 30 April rate: 13.25% for 2022, 12% for 2023 and 8% from 2024. The November 2022 and January 2024 changes do not show in annual results (#1807).

Announced abolitions

For an abolition announced ahead of its effective date (for example the removal of the two-child limit, announced at the 2025 Budget and since enacted by the Universal Credit (Removal of Two Child Limit) Act 2026, in gov/dwp/universal_credit/elements/child/limit/child_count.yaml):

The same pattern applies in reverse to one-off or time-limited payments. The means-tested Cost-of-Living Payment in gov/treasury/cost_of_living_support/means_tested_households/amount.yaml is £650 from 2022, £900 from 2023 and goes back to zero from 2024-01-01. It also reads zero before 2022, from a 0001-01-01: 0 row: the model carries each parameter’s earliest value back to 2015 (backdate_parameters in policyengine_uk/utils/parameters.py), so without that row it would pay the one-off amount in every year from 2015.

Best practices

  1. Cite the announcement in metadata.reference at every future-dated row. Where possible, cite both the announcement and the legislation that enacts it once it is published. The 2022-04-06 row of the Class 1 employee main rate (national_insurance/class_1/employee_scale.yaml), for example, cites both the Health and Social Care Levy Act 2021 and the Budget document.

  2. Don’t extrapolate. Each future-dated row should reflect a specific announcement. If a parameter would otherwise move with uprating, let the uprating handle it. Adding a “frozen forever” row is a policy assertion that needs its own reference.

  3. Check how the parameter is annualised. A change dated part-way through a fiscal year only counts for part of the year if the parameter has fiscal_year_blend: true, or has preserve_calendar_dates: true and a formula that splits the year (as the alcohol and tobacco duties do); otherwise the model year takes the value in force on 30 April.

What this isn’t

This is not the same as scenario analysis or policy reform parameters under gov.contrib.*. Those are reform-side toggles for hypothetical changes the user wants to evaluate; future-dated parameter rows under gov.hmrc.*, gov.dwp.* etc. are baseline policy representing what is actually announced.

If a future change is uncertain or contested, model it under gov.contrib.* until it’s announced; once announced, move it into the baseline tree with an effective-date row.

References

Policy
VAT grossing to receipts
Policy
Indirect tax effects of reforms (planned)