must find £35bn to avoid cuts to public services while keeping his defence promises in his first Budget, the has warned.
The gap comes from three commitments at once: raising defence spending to 3% of by 2030, lifting health spending, and not squeezing other departments.
Higher inflation, caused by the war, is eating into what the government hoped to spend on public services.
The Budget is on 28 October. The IFS said Healey must set out credible spending plans, and warned that leaving the totals unaddressed would cast doubt on the government's credibility.
Healey resigned as defence secretary in June in a battle with the Treasury over military spending, under Keir Starmer's leadership.
The man who fought the Treasury over defence now runs it, and must fund the same defence increase from a budget the Treasury controls.
Tax rises are constrained. pledged in its manifesto not to raise National Insurance, income tax, or VAT, and Prime Minister has said he will stick to that promise. Former chancellor announced billions in tax rises.
Borrowing costs are rising. The IFS expects recent bond market turbulence and higher inflation to add around £10bn to forecasts for the government's borrowing costs in 2029-30, and expects the government to meet its with of around £20bn — down from the £24bn predicted at the Spring Statement by the .
Deferring the spending decision to next year's or is not free — the IFS says it would itself damage the credibility of the government's plans.
The inflation has a source. The US- war against and Russia's invasion of have together driven up energy prices worldwide, and those costs have been passed to customers at the pumps and on shelves.
Healey spoke ahead of the annual meeting this week, saying the consequences of conflict in the Middle East and Europe are hitting countries worldwide.