Chancellor pledges to scrap gas standing charge, promising £45 relief for many homes

The chancellor announced that eliminating the gas standing charge will save 60% of homes about £45 a year, a move he said is part of a broader effort to ease the cost of living.

John Healey, the chancellor, warned that the United Kingdom is facing a “difficult moment” as he prepares to deliver the first budget of Andy Burnham’s government. The budget announcement was accompanied by an interactive game inviting the public to try balancing the books.

Simon Francis, coordinator of the End Fuel Poverty Coalition, welcomed the proposal. He said removing the gas standing charge will bring real relief to many low‑income households that use very little energy and could stop debt from building up for pre‑payment customers during the summer months. Francis added that the chancellor’s acknowledgment that wider measures are needed to bring down bills is encouraging, but he will wait to see whether the budget matches those words with action.

Francis also noted that moving levies off electricity bills and into general taxation would be a positive step, and he warned that “there’s a problem with energy prices coming down the track.” He contrasted the current plan with the Conservatives’ “cheap energy” programme announced last year, which removed VAT from energy bills and rolled back some net‑zero taxes.

He accused Labour of “sleight of hand,” suggesting the government is simply shifting costs from one part of the energy bill or tax system to another. By contrast, Francis said, under Conservative rule “we would make the tougher decisions on public spending, so the actual energy bills and people’s taxes would be coming down.”

Why it matters

The proposed removal of the gas standing charge could lower monthly expenses for low‑income households and reduce the risk of energy debt, while the political debate highlights differing approaches to managing energy costs and public spending.

Key details

Location

United Kingdom · Europe

Reported by

The Guardian

First reported

28 Oct 2026, 15:02 IST

Key names

John Healey, UK, Andy Burnham, Simon Francis

Section

Business

Sources

This is an independent summary. Read the full, original reporting from the publisher:

• The GuardianBudget 2026 live: chancellor says scrapping gas standing charges will save 60% of homes £45 a year 28 Oct, 15:02

Read the full story at The Guardian ↗

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