Chancellor John Healey has announced a £100 energy payment for 20 million UK households in council tax bands A to D, paid directly into bank accounts as part of a £2.6bn scheme to help with winter costs.
Delivering the first Budget under Prime Minister Andy Burnham's leadership in the House of Commons at 12.30pm on Wednesday, October 28, Mr Healey said the payment would help families "through to spring".
Energy support for households
The former defence secretary said money would be given to devolved administrations and called on them to "do the same and give people of all nations in the UK breathing space on their energy bills this winter".
Speaking during his Budget speech, Mr Healey said: "Let me say this to families at home. I know that with the conflict in the Middle East, rising energy bills are a real worry. I know that people look to Government at times like this, not to solve all their problems, but to give them a bit of breathing space."
"So today I'm taking one further step. This winter, for 20 million households in council tax bands A to D, I am announcing a £100 energy payment for households, paid directly into people's bank accounts to deal with rising energy bills."
VAT cut and business support
The Chancellor also announced that the current cut to VAT on electricity will be extended to July, taking £50 off the annual price cap. He told the Commons: "In the first week of this new Government, we took VAT off electricity for 29 million households, today I'm extending that VAT cut through the winter and spring to July, taking £50 off the annual price cap."
For businesses, Mr Healey said the new British industrial competitiveness scheme will take 25% off electricity bills for 10,000 firms at the heart of British industry. It will go live in April, with backdated payments for energy costs this year.
Fuel duty and mileage rates
Other measures included extending the fuel duty cut until July 2027. Mr Healey told MPs: "Earlier this year, the Government extended the 5p cut to fuel duty and slashed red diesel to its lowest rate in over 20 years."
"With the war in the Middle East still driving high fuel prices, I am extending these tax cuts for motorists through the winter and spring to July, supporting households, hauliers, and farmers."
In an increase to mileage rate, Mr Healey added: "And for anyone who relies on their car for their work, from care workers to engineers, I am increasing the higher mileage rate from 25p to 35p per mile, and making permanent the increase to the standard mileage rate introduced earlier this year."
