Around 20 million UK households are set to receive a £100 energy payment this winter under a new measure announced in the government’s Autumn Budget.

Chancellor John Healey said the Household Energy Payment will provide eligible households with an automatic rebate paid directly into their bank accounts. The scheme is expected to cost the government approximately £2.6 billion.

Eligibility will be based on council tax bands, with households in bands A to D qualifying for the payment. The government says the measure is intended to ease pressure on families facing higher energy costs during the colder months.

The announcement comes amid concerns about household finances and energy prices, with international instability contributing to uncertainty in global oil and gas markets.

The Budget also includes changes to bank taxation to help fund the measure. The government has encouraged Scotland, Wales and Northern Ireland to consider adopting equivalent support for eligible households in their jurisdictions.

The payment is a one-off contribution rather than a permanent reduction in energy bills. Households should check the official eligibility guidance for details on how the rebate will be delivered and whether any action is required.

The policy is likely to become a major focus of political debate, particularly over whether council tax bands are the fairest way to target help at households struggling with fuel costs.