Key facts
- A one-off £100 "Household Energy Payment" will be given to households in council tax bands A to D in England.
- Gas standing charges will be scrapped in England, Scotland and Wales, with reforms shifting costs to unit prices.
- The 5p fuel duty cut on petrol and diesel will be extended to July.
- Minimum wage rates will rise by 3.9% in April.
- The state pension will increase by 3.9% in line with average wage increases.
- A new "Starter Isa" for first-time investors is planned, replacing the Lifetime Isa.
Chancellor John Healey announced a series of measures aimed at alleviating cost-of-living pressures for UK households. Families will receive a one-off £100 "Household Energy Payment" from January, funded by an increased tax on banks, to help with rising energy bills. The government also plans to extend the VAT cut on electricity bills until July and scrap gas standing charges in England, Scotland, and Wales from 2027, shifting these costs onto energy unit prices. The temporary 5p cut in fuel duty on petrol and diesel will be extended to July, providing continued relief for drivers amidst high motor fuel prices. In savings, the government has ditched plans to reduce the annual tax-free Isa allowance and will instead introduce a new "Starter Isa" for first-time investors. Minimum wage rates are set to increase by 3.9% in April, and the state pension will also rise by the same percentage in line with average wage increases. A new Pension Tax Allowance will ensure pensioners with incomes up to the full state pension amount will not pay income tax.