UK Budget 2026: Households in Scotland to benefit from £100 energy payment
The Scottish government said it will replicate a policy announced by Chancellor John Healey
Almost two million households in Scotland are to benefit from a £100 payment towards energy bills amid warnings the measure will fall far short of what is needed to cope with rising costs.
The Scottish government said it will replicate a policy announced by John Healey as part of his UK Budget, but also accused the Chancellor of delivering a real-terms cut to its block grant of around £650 million in 2027-28.
Jenny Gilruth, the Deputy First Minister, said Scotland was being “treated as an afterthought”.
Speaking in the House of Commons, Mr Healey said the £100 support would be paid directly to the bank accounts of households in council tax bands A to D in England at a cost of £2.6 billion.
He called on the Scottish government to do the same in order to “give people of all nations in the UK breathing space on their energy bills this winter”.
The Chancellor said: “Let me say this to families at home. I know that with the conflict in the Middle East, rising energy bills are a real worry.
“I know that people look to government at times like this, not to solve all their problems, but to give them a bit of breathing space.
READ MORE: Budget 2026 LIVE: Chancellor John Healey's spending plans and what they mean for Scotland
“So today I’m taking one further step. This winter, for 20 million households in council tax bands A to D, I am announcing a £100 energy payment for households, paid directly into people’s bank accounts to deal with rising energy bills.
“That’s a £2.6 billion scheme to take the pressure off in the coldest months and see people though to the spring.”
There are around 1.9 million homes in Scotland in council tax bands A to D, meaning replicating the policy will cost at least £190 million.
Council tax bands are based on 1991 property valuations, and there have long been calls for reform.
The Institute for Fiscal Studies previously said more than half of properties in Scotland are effectively in the wrong band.
Ms Gilruth said: “The Scottish government’s budget will be cut by around £650 million next year - reducing the money we have to spend on public services and supporting people with the cost of living.
“The Prime Minister has previously claimed that he would respect devolution and the Scottish government – but his actions do not match his words. Cutting Scotland’s budget shows that, yet again, we are being treated as an afterthought.
“The Scottish government will ensure that households in Scotland will benefit from the one-off £100 payment for energy bill support, however, it is clear that the measures announced today fall far short of the action which is required.
“Furthermore, this support does not come close to meeting the promises on which the UK government came to office, including reducing energy bills by £300 which remain significantly higher than they were in July 2024. The UK government has failed to meet the moment and has failed to keep its promise.”
Speaking to journalists in Holyrood, Ms Gilruth, who is also the Finance Secretary, said the Scottish government is planning on a “like-for-like” payment.
“We welcome progress, but it doesn’t ultimately go far enough to meet the significant costs that folk are facing at the current time in terms of their energy bills,” she said. “And ultimately, in an energy-rich country like Scotland, we don’t think our people should be having to pay the price.”
The SNP government said Scotland’s resource block grant is set to reduce by 1.3 per cent in real terms in 2027-28, equivalent to a reduction of around £550 million. Meanwhile, Scotland’s capital budget will see a 1.5 per cent real terms reduction in 2027-28, equivalent to around £100 million.
However, Ms Gilruth ruled out freezing benefits to save cash. "I think a freeze at the current time would be off the table,” she told journalists.
Scottish Secretary Douglas Alexander said: “This is a Budget that puts money back in the pockets of Scottish households, backs businesses and puts Scotland firmly at the heart of the UK Government’s plan for growth and reindustrialisation.”
He said there was a “boost for Scotland’s public services too”, with an extra £600 million for the Scottish government to spend over the next three years.
Scottish Labour leader Michael Marra welcomed the SNP government’s commitment to pass on the £100 energy bills payment.
“It’s obviously right that they do that,” he said. “It’s only possible because of the decisions that the Labour government are taking and it is the core issue that people are raising. People are seeing it in their bills, they’re seeing it month to month, trying to make sure they can make ends meet.
“So I’m really glad if the SNP are responding positively to that proposal, it’s absolutely right that they should support it – I want to see that delivered as soon as possible.”
Elsewhere, Scottish Tory leader Russell Findlay dismissed the UK Budget as a “damp squib”.
He said: “People across Scotland and the rest of the UK will be forgiven for asking ‘is that it?’
“John Healey’s first Budget was a damp squib which will do nothing to boost economic growth.
“Once again, a Labour Chancellor has bottled out of getting a grip of his party’s out-of-control benefits bill.
“Both Labour and the SNP are addicted to spending more on benefits, rather than getting people back into work. They keep hammering strivers to support shirkers.”
Business leaders criticised the Budget as “disappointing”.
Charandeep Singh, chief executive of Scottish Chambers of Commerce, said: “This Budget will not provide the reassurance our members were seeking at a time when employers across Scotland are crying out for action to alleviate the high cost of doing business.”
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