By Islam El-Sakka
Chancellor John Healey announced a £100 energy bill payment for around 20 million UK households during his Autumn Budget speech. The "Household Energy Payment" will be paid directly into bank accounts this winter, costing the government £2.6 billion. Healey said the measure aims to give families "breathing space" amid rising energy costs driven by global uncertainties, including the war in Iran.
Eligibility Based on Council Tax Bands
Only households in council tax bands A to D will qualify for the automatic rebate. The government estimates this covers 80 per cent of fuel-stressed households and 88 per cent of those in the bottom three income deciles. Households can check their band using the government's postcode checker, which experienced temporary outages after the announcement.
Funding Through Bank Surcharge Increase
To fund the scheme, the Bank Surcharge on banks will rise from 5 per cent to 8 per cent for 15 months starting in January. Healey said the UK's world-leading banks make a huge contribution through taxes, jobs and investment, and asked them to help fund breathing space for British families during global economic storms.
Gas Standing Charges to Be Scrapped
Alongside the payment, Healey confirmed that standing charges on gas bills will be removed from 2027, affecting around 23 million homes. The Treasury estimates this could save 60 per cent of households an average of £45 annually. Fixed costs will shift to the unit rate, and the chancellor signalled he will also examine removing electricity standing charges.
Criticism of Targeting Method
Experts have criticised the use of council tax bands, noting the last full property valuation was in 1991 and banding has not kept pace with uneven property price inflation. High-value properties in areas like London may fall into band D, potentially making the measure less well-targeted.
