UK budget sends 20 million households a £100 energy payment
Healey pairs winter relief with a higher bank tax as the Middle East conflict pushes bills higher, two billion pounds of breathing space paid for partly by the banks that lend to the state
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Budget 2026 live: Healey announces £100 energy payment for millions and rise in bank tax
theguardian.com
Chancellor John Healey has announced a £100 energy payment for 20 million households this winter, alongside a rise in the tax on banks. The payment, set out in Budget 2026, goes to homes in council tax bands A to D, and Healey tied it directly to energy bills that have climbed with the conflict in the Middle East.
The arithmetic is modest and the framing candid. Twenty million payments of £100 amount to roughly two billion pounds, collected from a banking sector that already carries its own levy on profits. The chancellor described rising energy bills as 'a real worry for families' given the conflict — an acknowledgement that the price shock is external, ongoing and beyond the budget's reach. People look to government at times like this, he said, 'not to solve all their problems but to give them a bit of breathing space'.
The design does its means-testing through the council tax register rather than the benefits system: property value, not income and not actual energy costs, decides who receives the cheque. No application, no assessment of need — and no adjustment for the household heating a large, draughty band-D house rather than a small flat.
The revenue side folds the budget back on itself. The rise falls on the banks, the institutions that underwrite the government's own borrowing, so the state is taxing its creditors to soften bills it cannot otherwise influence. Those bills are set by a war the Treasury did not start and cannot end, and the one-off shape of the payment leaves next winter's arithmetic untouched.
The £100 arrives with the winter bills. Nothing in the budget changes what those bills will be.