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The press release issued by 10 Downing Street on 22 July 2026.

The Prime Minister had calls with the First Minister of Scotland, the First Minister of Wales and the First Minister and Deputy First Minister of Northern Ireland today. 

The Prime Minister said he was serious about creating a new politics – rooted in finding common ground based on collaborative, practical and pragmatic relations with the Heads of the Devolved Governments. 

Working in partnership, the Prime Minister said together they could drive deeper devolution to all parts of the United Kingdom to get growth going. 

The Prime Minister added he was focused on practical measures, not constitutional changes like further referendums, to give families more breathing room by helping them with the cost of living, which he had done today by helping millions of households with their energy bills. 

The Prime Minister said he looked forward to meeting with the Heads of the Devolved Governments soon and visiting Scotland, Wales and Northern Ireland shortly.

The press release issued by 10 Downing Street on 21 July 2026.

• New Prime Minister takes immediate action to cut taxes on electricity bills to give millions of households breathing space this winter
• Tax cut this year funded from cancelled Digital ID programme will see VAT on electricity bills removed from October 1
• In one of his first acts as Prime Minister Andy Burnham promises to “put more money in people’s pockets and bring back hope”

Millions of households across the UK will benefit from immediate action to help with their electricity bills this winter, the Prime Minister has announced as one of his first decisions in office.

This follows his commitment to the nation on the steps of Downing Street yesterday to give people some breathing space and help with the cost of living. 

Government is tackling rising bills with a tax cut to remove VAT from domestic electricity bills from October 1 in time to impact the next Ofgem price cap. This immediate action applies and is funded for this financial year.

The cost of this immediate action for this financial year – taken now, before the next price cap – is being funded from the cancellation of the (£1.8 billion) Digital ID programme.

Any further action, including on funding for longer-term measures, will be taken at the Budget alongside an OBR forecast. All decisions at that point will continue to be funded and also consistent with the government’s fiscal rules.

Prime Minister Andy Burnham said: 

Westminster has not been working for people for too long, with families struggling with the cost of living.  

That needs to change. I said I wanted to give people breathing space, and that’s what I’m announcing on my second day as Prime Minister.   

We’re taking immediate action to cut taxes on energy bills, put more money in people’s pockets and bring back hope.

Cutting VAT on electricity bills is expected to take around £45 off the yearly Ofgem price cap in October. This is on top of the £150 removed from bills at the last Budget.  

By targeting electricity bills, more people will be supported with rising bills and the government is helping to keep inflation down.  

All suppliers are expected to pass the VAT reduction on to all customers, including those on fixed tariffs, as they did with the £150 of costs taken off energy bills announced at the last Budget.

Small businesses who qualify for the domestic energy VAT relief and are not registered for  VAT, as well as charities and residential care homes eligible for the reduced rate will also benefit.

Chancellor of the Exchequer John Healey MP said: 

For too long, too many people have struggled with the cost of living. 

Today’s energy tax cut will give families some breathing room on bills, and provide some reassurance this winter. 

This measure is funded this year from cancelling the Digital ID programme, and it will help bring down inflation while supporting households in every postcode.

As part of the day one commitment to bring back hope to Britain, the change supports the poorest households, who spend a higher percentage of their income on energy bills. 

Energy bills have risen since Russia’s invasion of Ukraine and have been exacerbated because of the war in Iran. But people need support now, which is why the government has acted to provide immediate breathing space for millions of households.

The NI Executive will receive comparable funding to enable it to support NI Households with the cost of living to ensure households across the UK benefit.  

Additional information

• This VAT cut, from 5% to 0%, is estimated to reduce  CPI inflation by around 0.10 percentage points and RPI by around 0.14 percentage points. 
• This action is estimated to cost  around £850 million in 2026-27 on the basis of estimated electricity prices. Updated costs will be set out at Budget.
• We are funding this through the cancellation of the Digital ID programme, which was going to cost £1.8 billion over the next three years. Savings were due to be identified from within existing budgets through reprioritisation, which will now be redirected towards this measure. Any further action, including on funding for longer-term measures, will be taken at the Budget, and all decisions at that point will be funded and also consistent with the government’s fiscal rules. 
• The government expects all suppliers to pass the VAT reduction on to all customers, including those on fixed tariffs, as they did with the £150 of costs taken off energy bills announced at the last Budget. 

Northern Ireland 

• Under the terms of  the  UK’s exit from  the  EU, the  EU VAT rates  apply  in NI on goods, including electricity.  Agreement from the EU to implement in NI would be necessary.
• Therefore to ensure that households in NI receive the same support as quickly as the rest of the UK, the NI Executive will receive comparable funding to enable it to support NI Households with the Cost of Living.

The press release issued by 10 Downing Street on 20 July 2026.

The Prime Minister spoke to António Costa, President of the European Council, this evening. 

The Prime Minister began by underlining the importance of creating a stronger Europe through a closer UK-EU relationship. 

That included working together on shared challenges such as defence and security and driving growth across the UK and Europe. 

They both agreed their respective teams would work closely towards a UK-EU summit later in the year. 

They looked forward to speaking again soon.

The press release issued by 10 Downing Street on 20 July 2026.

The Prime Minister spoke to the NATO Secretary General, Mark Rutte, this evening. 

The Prime Minister began by congratulating the Secretary General on the successful NATO summit held in Ankara earlier this month, and the strong signal of unity it sent to the world in such volatile times. 

Updating on the appointment of the former Defence Secretary, John Healey, as the new Chancellor of the Exchequer, the Prime Minister said the appointment was a signal of his intent. 

The leaders also discussed the situation in Ukraine, and the Secretary General welcomed the Prime Minister’s strong statement of support for Ukraine earlier today. 

Both leaders looked forward to speaking again soon.

The press release issued by 10 Downing Street on 20 July 2026.

The Prime Minister spoke to President Emmanuel Macron of France this evening.

The Prime Minister began by setting out how he is looking forward to building on the strong UK-France relationship to deliver for people on both sides of the Channel.

Turning to Ukraine, the two leaders discussed the need to work together to continue supporting Ukraine as it resists Russia’s full-scale invasion, including through co-chairing the Coalition of the Willing.

On the Middle East, the two leaders agreed the need to continue efforts towards deescalation and to reopen the Strait of Hormuz.

They also discussed continuing the UK and France’s close cooperation on energy and defence, and the Prime Minister paid tribute to President Macron for his efforts to bring the Bayeux Tapestry to the UK, which underlined the UK and France’s enduring friendship.

The two leaders look forward to speaking again and the Prime Minister welcoming President Macron to the United Kingdom at the earliest opportunity.

The press release issued by 10 Downing Street on 20 July 2026.

The Prime Minister spoke to the President of the European Commission, Ursula von der Leyen, this afternoon.

The Prime Minister thanked the President for her warm congratulations, adding that he was looking forward to working closely with President von der Leyen and her team.

Building a closer and ambitious relationship was key to delivery in both the UK and Europe, the Prime Minister added.

The leaders agreed their teams should work closely towards a UK-EU Summit later in the year.

Turning to Ukraine, the Prime Minister underlined that the UK’s steadfast commitment to Ukraine would be ironclad under his government, and thanked President von der Leyen for her leadership on the conflict.

The two leaders looked forward to speaking again soon.