Chancellor John Healey to scrap gas standing charges for 23 million homes

The Treasury says the move will shift fixed costs onto unit rates, potentially cutting annual bills by £22‑£50.

By Felo News Desk · Published Wed, 28 Oct 2026 11:28:08 GMT

Chancellor John Healey announced on Budget day that standing charges on gas bills will be removed for roughly 23 million homes, with the change to take effect in 2027 or as soon as possible thereafter, according to the Treasury.

What happened

The Treasury said Healey will ask energy regulator Ofgem to eliminate the fixed daily fee that is added to gas bills regardless of usage. The charge currently costs about £108 per year for a typical household. By moving the cost onto the unit rate, the Treasury estimates an average saving of £45 per year for 60 % of households, with some estimates of £22‑£50 per year.

What the reports add

Standard.co.uk reported that the removal will apply to around 23 million homes and that the shift to unit‑rate pricing could save 60 % of households an average of £45 annually. The Independent added that the move could save households between £22 and £50 per year and placed the announcement among a series of “everyday fixes” in the Budget, including cuts to supermarket staples and the removal of import tariffs on over 100 products.

What was said

Prime Minister Andy Burnham said, “Abolishing gas standing charges is about basic fairness and giving people more control over their bills. I am determined to reform our broken energy market, so it better serves the public interest,” as reported by both Standard.co.uk and the Independent.

Healey told reporters, “Gas standing charges are unfair and outdated so I am scrapping them to give millions of households a bit of breathing space,” according to Standard.co.uk.

How it came about

The announcement follows Healey’s broader Budget agenda to provide “breathing space” for families, which includes a fuel‑duty freeze and targeted support for households and businesses. Felo previously covered the planned gas‑standing‑charge cut in Healey to cut household gas standing charges by up to £50 in Budget (2026‑10‑27) and the wider energy‑bill measures in Healey pledges budget measures to cut energy bills as SNP calls for £300 relief (2026‑10‑28).

Key facts

Standing charges on gas bills will be removed for about 23 million homes. (standard.co.uk)
The change is slated for 2027 or as soon as possible after. (standard.co.uk)
Typical household gas standing charges cost around £108 per year. (standard.co.uk)
Savings could range from £22 to £50 per year per household. (independent.co.uk)