John Healey will scrap standing charges on gas bills for millions of Britons in the Budget this afternoon, the government has announced.
The Chancellor had promised to get 'energy costs down for good' and provide 'breathing space' for hard-pressed families.
Standing charges, which cover the cost of delivery to homes and businesses, are the feature of energy bills people complain about most, according to energy companies.
They will be scrapped from next year 'or as soon as possible after', the Treasury said this morning.
Mr Healey will deliver his Budget statement to the House of Commons at around 12.30pm, amid mounting pressure to ease the cost-of-living crisis, boost Britain's struggling economy and plug a multibillion-pound hole in the public finances.
The Chancellor is expected to announce further measures targeting fuel duty and businesses, while speculation mounts over a potential tax raid on banks.
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Opposition parties unite to attack Chancellor over 'lack of ambition'
John Healey is facing criticism from across the political spectrum as opposition parties accuse him of failing to go far enough in today's Budget.
Shadow chancellor Andrew Griffith warned:
Healey must use his Budget to take tough decisions, instead of continuing to kick the can down the road.
Reform UK's Robert Jenrick said:
"[He] can't keep fiddling while the economy burns. [Instead he needs] a break-glass Budget that finally puts the economy back on track.
The Liberal Democrats warned:
A 'steady as she goes' budget is not going to cut it.
Green Party leader Zack Polanski said:
Today’s budget looks like a catastrophic let down for anyone expecting Burnham to give them hope for the future.
Pictured: PM leaves No 10 after chairing Cabinet Meeting ahead of the Budget
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Lancashire and Essex set to get elected mayors in devolution shake-up
Lancashire and Essex are set to get elected mayors under plans expected to be announced today.
The move forms part of Andy Burnham's drive to hand more powers to local leaders and shift decision-making away from Westminster.
Lancashire is currently the only part of northern England without an elected mayor or plans already under way to introduce one, following years of disputes over how the county should be governed.
Ministers are also looking to establish further mayoral authorities across southern England as part of the wider devolution push.
Chancellor set to announce £4.7bn boost for Britain's armed forces
John Healey is expected to unveil an additional £4.7billion for the military in today's Budget to plug a funding shortfall in the Defence Investment Plan announced by Sir Keir Starmer in June.
But the Chancellor could face a backlash from opposition MPs if he fails to pledge to raise defence spending to three per cent of GDP by 2030.
Mr Healey previously resigned as defence secretary after clashing with Sir Keir over his refusal to commit to the spending target.
Jeremy Hunt warns Chancellor against 'populist' Budget gimmicks
Former chancellor Jeremy Hunt has accused the Government of putting short-term popularity ahead of tackling Britain's economic problems.
The senior Tory warned that today's Budget could be dominated by 'smaller, populist measures designed to play well on social media' rather than 'long-term economic decisions' to drive growth.
He told Sky News:
The opportunity in a Budget is to do something where you can really tackle one of the problems holding back economic growth and I don’t sense that we’re going to hear much of that.
Budget to reveal plans for major shake-up of powers for regional mayors
The Budget is expected to unveil further details of plans to hand regional mayors greater control over taxes and spending.
The proposals form part of Andy Burnham's pledge to 'rewire' the state through a major expansion of devolution.
Mayors have already been promised a share of business rates from April, followed by income tax revenues a year later, in place of existing government grants.
A new roadmap is expected to reveal how quickly the changes will be introduced, how much money regions can keep and whether mayors will be granted greater borrowing powers.
HSBC slashes UK growth forecasts
HSBC slashed its UK growth forecast, warning the economic outlook had 'deteriorated' as a pre-Budget row erupted over a tax raid on banks.
In a blow to John Healey, the bank cut its GDP growth estimates for 2027 from 1.4 per cent to 1.1 per cent, as higher inflation and interest rates dampen consumer spending and the housing market.
It came as the Chancellor was urged to press ahead with a windfall tax on banks after the bank posted another surge in quarterly profits.
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Bumper HSBC profits spark pre-Budget row over tax
Chancellor John Healey has been urged to press ahead with a windfall tax on banks after HSBC posted another surge in its quarterly profits.
Farage hits out at plans to let HMRC raid bank accounts for unpaid tax
Nigel Farage has hit out at plans to hand HMRC greater powers to take unpaid taxes directly from people’s bank accounts.
The Reform UK leader warned the measures “could be used against anyone deemed to be a threat by the government of the day”.
Under existing rules, HMRC can recover debts of more than £1,000 directly from bank accounts, provided at least £5,000 is left across the taxpayer’s accounts.
But Treasury officials indicated last week that the Chancellor was preparing to expand the taxman’s powers to claw back unpaid debts.