The Prime Minister, Andy Burnham. (Image: Getty)
Andy Burnham has issued a bombshell announcement about the future of standing charges on gas bills. The Prime Minister told the Commons that ministers will consider whether the fee can be removed from gas bills to ease cost pressures on British households. Standing charges are fixed daily fees set by the energy regulator Ofgem for energy use. Households get charged it regardless of whether they’re using energy on that day. The weighted average standing charge on gas bills across the UK is set at 29.68p until December 31, with price caps and standing charges reviewed and updated by Ofgem every three months. There is a separate cap and average standing charge for electricity rates, which the watchdog also regulates.
Mr Burnham told MPs that he had asked the Chancellor John Healey and Energy Secretary Miatta Fahnbulleh to examine getting rid of the charges and to report back to MPs as soon as possible. It came in response to a question about the Government’s decision to approve for the Jackdaw gas field in Prime Minister’s Questions.
He said he had made a decision that he claimed the previous Conservative government “messed up”. “That’s why there was the delay, because they didn’t do the process properly. And we’ve made a pragmatic decision, Mr Speaker, that will allow us to do two things,” the Labour leader said.
“Firstly, build a bridge to a renewable future because the resources that come in now from this decision will allow us to invest in renewables, bring forward clean energy and in this Parliament, substantially de-link gas and electricity prices so that we can bring bills down.
“It will also allow us, Mr Speaker, to do more to help people with bills. I can tell the House today that I have asked the Chancellor and the Energy Secretary (Miatta Fahnbulleh) to look at whether we can remove standing charges from gas bills and to report back to this House at the earliest opportunity.”
Tory leader Kemi Badenoch had accused the Labour Government of “dithering” for two-and-a-half years to approve Jackdaw, as she called for Labour to repeal its ban on all new oil and gas licences. “We have the resources, the expertise and the people,” she said. “What we have lost is the confidence to make tough decisions”.
The Ofgem’s energy price cap rose by 4% from October 1. Experts have warned it could rise considerably more January, reflecting the impact of the war in the Middle East, which has sent global energy prices skyrocketing.
Cornwall Insight’s latest forecast predicts the price cap will rise by a further 16% to £1,999 a year on January 1, up by £276 on the level between October and December. It would represent the biggest rise since January 2023.
In a bid to help households with costs, the Government has temporarily removed the 5% VAT from electricity bills until March 31 2027 to cut around £45 a year. However, households are still paying 5% VAT for gas.
Last week, Ofgem’s new CEO Tim Jarvis warned of a “difficult” winter ahead as he raised concerns that “people are going to struggle” without help.
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Speaking at the Energy UK conference in London, he said: “We can all see what’s happening to wholesale prices as a result of what’s going on in the Middle East, and we’ve seen the predictions for January. It’s going to be a difficult winter.”
Campaigners have called on the Government to make plans now to support all households with energy costs this winter due to the severity of forecast bill hikes.
The End Fuel Poverty Coalition has called on ministers to prepare an “emergency heat tariff” to cap the cost of heating this winter, with gas prices already rising 27% year-on-year.
A poll for Uswitch suggests some 1.7 million households won’t turn on their heating this winter amid fears of soaring bills and efforts to reduce their spending.
The Department for Energy Security & Net Zero (DESNZ) has been approached for comment.
Andy Burnham Issues Bombshell Gas Bill Announcement as Millions of UK Households Face Energy Pressure
Andy Burnham has announced a major review of household gas bills, asking ministers to examine whether standing charges could be removed as the government looks for ways to ease pressure on families facing rising energy costs. The proposal has placed a familiar household expense at the centre of the political debate, raising questions about whether consumers could eventually pay less simply for remaining connected to the gas network.
The announcement came during Prime Minister’s Questions on 21 October 2026, when Burnham said he had asked Chancellor John Healey and Energy Secretary Miatta Fahnbulleh to investigate the possibility of scrapping gas standing charges and report back to Parliament. The move was presented as part of a broader effort to reduce energy costs, alongside the government’s plans for the future of Britain’s energy system. <Cite refs={[“turn856971search0″,”turn856971search5”]}/>
However, while the proposal could benefit some households, it does not yet amount to a confirmed reduction in bills. Ministers still need to establish how the change would work, how the costs currently covered by standing charges would be recovered and which groups of consumers would gain or lose.
What are gas standing charges?
Standing charges are fixed daily fees paid by households for access to the gas network, regardless of how much gas they use. They help cover the costs of maintaining pipes and infrastructure, connecting customers to the network and funding certain obligations associated with energy supply.
Under the current arrangements, a household can still incur standing charges even when it uses little or no gas. This has long frustrated consumers who try to reduce their bills by turning down the heating, improving insulation or spending time away from home.
The average gas standing charge reported in October 2026 was approximately 29.7 pence a day. Over a full year, that amounts to around £108, although the exact charge varies according to region and payment arrangements. <Cite refs={[“turn856971search1″,”turn856971search4”]}/>
For families already struggling with food prices, mortgage payments, rent and other household expenses, an unavoidable daily fee can feel particularly difficult to justify. Unlike gas consumption, which can be reduced through changes in behaviour, the standing charge continues to accumulate.
That is why Burnham’s announcement has attracted attention. Removing the separate charge could make household bills more closely reflect the amount of gas actually used. Yet the financial consequences would depend on the details of any eventual reform.
Could households really save money?
The central question is whether removing standing charges would lower the total amount consumers pay or simply change the way the bill is calculated.
One possible approach would be to transfer the costs currently covered by the standing charge into the price charged for each unit of gas. Under such a system, customers would no longer see a separate daily fee, but the unit price of gas could increase.
This distinction matters. If the same costs still need to be recovered, abolishing the standing charge does not automatically eliminate those costs from the energy system.
Research organisation Nesta has argued that shifting gas standing charges into unit rates could benefit low-income households and people who use relatively little gas. One estimate cited in recent reporting suggested a typical annual saving of approximately £27, depending on the final design of the reform. <Cite refs={[“turn856971search1″,”turn856971news7”]}/>
For a household using very little gas, avoiding a fixed daily fee could make a noticeable difference. People who live alone, spend long periods away from home or rely on alternative heating arrangements might welcome a system in which more of their bill depends on consumption.
But other customers could face higher costs. Households that use large amounts of gas, including some families living in poorly insulated homes or people who need additional heating because of health or mobility difficulties, could pay more if unit rates rose sufficiently.
The government will therefore have to consider how to distribute costs fairly. A reform that benefits some consumers while increasing bills for vulnerable high-use households could create new problems even as it addresses existing complaints.
The timing raises the stakes
The announcement comes as households prepare for another difficult winter and energy-price forecasts remain a source of concern.
Cornwall Insight forecast in October that the Ofgem energy price cap could rise by around 16% in January 2027, taking the annualised bill for a typical household paying by direct debit to approximately £1,999. This was a forecast, not a confirmed future price cap, and the eventual outcome could change as wholesale prices and other costs develop. <Cite refs={[“turn856971search3″,”turn856971news7”]}/>
Even the possibility of a substantial increase is worrying for households that have already cut back on heating or fallen behind on payments. Energy costs affect more than comfort: they can influence health, household debt and the amount of money available for food and other essentials.
The government has also faced calls for more targeted support. Some campaigners argue that vulnerable households need additional assistance before winter bills rise, rather than having to wait for longer-term reforms to take effect.
Standing-charge changes could form part of a wider response, but they would not necessarily address the immediate needs of every household. Any policy intended to provide urgent relief would need to consider the people who are already struggling to pay for essential energy.
A political challenge for Burnham
The proposal gives Burnham an opportunity to demonstrate that the government is addressing a cost that many consumers regard as unfair. Standing charges have been debated for years, and the issue has drawn criticism from customers who believe they are penalised even when they make significant efforts to reduce consumption.
For Labour, the announcement also creates expectations. Once ministers publicly signal that a charge could be removed, households may reasonably want to know when a decision will be made, how much they could save and whether the reform will apply throughout the country.
The government will need to explain the proposal in practical terms rather than relying on the appeal of abolishing a separate line on the bill. Consumers will want to know whether their total annual costs are likely to fall, how the policy affects different levels of usage and whether any protections will be introduced for vulnerable customers.
Opposition politicians are likely to examine whether the proposal delivers meaningful savings or merely shifts costs from one part of the bill to another. Such scrutiny is legitimate, particularly when households are making financial decisions based on expectations about future energy prices.
The key measure of success will be the impact on actual bills, not the announcement itself.
Why removing the charge is more complicated than it sounds
Standing charges help fund costs that do not disappear simply because a customer uses less gas. The network still needs maintenance, connections must be managed and suppliers must meet their obligations.
If standing charges were abolished without another way to recover these costs, energy companies and network operators would face a funding gap. In practice, policymakers would need to decide whether those costs should be transferred to unit rates, covered through other charges or partly funded by public money.
Each option has different consequences. Moving costs into unit rates would give customers greater scope to reduce the consumption-related part of their bills, but it could increase costs for heavy users. Funding some expenses through taxation would spread costs more widely, but would also create pressure on public finances.
There are also questions about people who use gas for essential heating and cannot easily reduce their consumption. A household in an inefficient property may use more energy than a household in a modern, well-insulated home, even when both occupants are equally careful.
That means any reform should be considered alongside measures that improve home insulation, reduce energy waste and support people who cannot afford the upfront cost of making their homes more efficient.
Ofgem has already examined options for changing standing charges, including low-standing-charge tariffs. The regulator’s work illustrates how difficult it can be to redesign the system without creating unintended consequences for particular groups of consumers. <Cite refs={[“turn856971search1″,”turn856971search3”]}/>
Gas bills and Britain’s wider energy strategy
Burnham linked the standing-charge review to a broader energy agenda, arguing that investment in renewable power could help reduce bills over time by weakening the connection between gas and electricity prices. The government has also defended its decision to approve development of the Jackdaw gas field in the North Sea, presenting the decision as a measure intended to support energy security while creating resources for investment in cleaner energy. <Cite refs={[“turn856971search0″,”turn856971search2”]}/>
These issues are related, but they should not be confused. Removing a standing charge would change the structure of household gas bills. Expanding renewable generation and reforming electricity pricing would involve longer-term changes to how energy is produced and priced.
Nor would approval of additional domestic gas production automatically guarantee lower household bills. Prices depend on wider markets, supply and demand, infrastructure and the way energy costs are passed through to consumers.
The government therefore faces two distinct tasks: offering practical help to households in the short term and developing an energy system that is more affordable and resilient over the longer term.
What happens next?
For now, Burnham’s announcement is a request for ministers to examine the options, not a final decision to abolish gas standing charges. The next stage will need to establish the possible design of the policy, its effect on different consumers and how the energy system would recover the costs currently covered by the fixed fee.
Households should not assume that their bills will immediately fall or that the daily charge has already been removed. Any confirmed change would need to be communicated clearly, including when it would take effect and whether customers would need to take any action.
The proposal nevertheless highlights a genuine issue in the way energy costs are distributed. Fixed charges can place a disproportionate burden on people who use little gas, while shifting those charges elsewhere could create difficulties for households with high essential energy needs.
Ultimately, the success of Burnham’s plan will depend on whether it makes energy more affordable in practice. A change in billing structure may help some families, but meaningful reform must account for the full range of household circumstances.
As winter approaches and concerns over future prices continue, consumers will be looking for clear answers rather than promises alone. The government’s challenge is to turn its review into a transparent, workable policy that protects vulnerable households, treats customers fairly and delivers measurable results on the bills people actually pay.