By Basant El-Faramawy
UK Chancellor John Healey delivered his autumn Budget on Wednesday, unveiling a £100 energy bill payment for around 20 million households in council tax bands A to D, alongside a VAT cut extension on electricity and other cost-of-living measures.
Energy bill support
The payment, costing £2.6 billion, will be paid directly into bank accounts this winter. Healey said the measure aims to give families “a bit of breathing space” amid rising energy bills linked to the Middle East conflict.
Tax and wage measures
Other key announcements included extending the fuel duty cut until July 2027, a 3.9% rise in the minimum wage, and a temporary increase in the bank levy. The Office for Budget Responsibility downgraded next year’s GDP growth forecast to 1% from 1.6%, while upgrading this year’s outlook to 1.2%.
Housing reforms
Healey replaced the Lifetime ISA with a new First Time Buyer ISA and launched a “Your First Home” equity loan scheme backed by £4.7 billion of government lending to help first-time buyers without parental support.
Pension changes
The Chancellor also outlined changes to the state pension triple lock, aiming to save £15 billion annually by the 2030s and £50 billion by 2050, describing it as a “new settlement for older generations” alongside a planned National Care Service.
Defence and Ukraine
On defence, Healey pledged £10 billion in additional economic and military support for Ukraine, including £500 million in urgent winter funding, but deferred a decision on raising defence spending to 3% of GDP until next year’s spending review.
Welfare reform
Healey vowed to “bring down the welfare bill in a Labour way,” citing reforms to universal credit, motability, and overseas pension access, with a white paper expected next year.
Tax devolution
The Budget also began devolving income tax receipts to mayors and business rates to localities, a move aligned with Prime Minister Andy Burnham’s devolution agenda but raising concerns about potential tax competition between regions.
Opposition response
Conservative leader Kemi Badenoch dismissed the Budget as “not good enough, not strong enough, not bold enough,” arguing the tax burden will reach a historic high and criticising the delay on defence spending.
