UK unveils energy support for 20M households, new aid for Ukraine

By Aysu Bicer and Burc Eruygur

LONDON / ISTANBUL (AA) - The UK announced a £100 ($133) winter energy payment for 20 million households in England and £10 billion ($13.3 billion) in additional support for Ukraine, Treasury chief John Healey said Wednesday.

The measures form part of Healey's first budget, which also includes changes to bank taxation, local government financing and defense spending.

The energy payment will be available to households in council tax bands A to D, which generally cover lower-value residential properties.

Funding will also be allocated to the devolved governments of Scotland, Wales and Northern Ireland to introduce similar support.

Healey announced measures to increase financial powers for local authorities and regional mayors, describing "fiscal devolution" as a key part of his budget plans.

Under the proposals, local authorities will retain business rates locally by the end of the decade, while mayors will receive a share of income tax revenue from 2028.

The government also confirmed a 3.9% increase in the minimum wage for workers aged 18 to 20, with a smaller increase for younger workers than for other age groups.

The budget includes an additional 3% on the bank surcharge, a tax paid by banks, which Healey described as "time-limited." The increase is smaller than previously expected.

- Defense and aid for Ukraine

Turning to defense, Healey said the UK's defense budget was £14 billion higher than in the final year of the Conservative government.

He said the government would set out in next year's spending review how it plans to meet the UK's NATO commitment to spend 3.5% of gross domestic product on defense by 2035.

A new defense finance task force will examine ways to achieve the target, while the government will seek to increase private investment in defense, including through public-private partnerships.

On Ukraine, Healey announced £10 billion in additional economic and military support following a telephone call with Ukrainian President Volodymyr Zelenskyy earlier in the day.

Healey said he and UK Prime Minister Andy Burnham informed Zelenskyy of the support package during the call.

"He told us 'you've made my day,'" Healey said.

The package includes £500 million in urgent military funding for Ukraine this winter.

Britain will stand with Ukraine "as long as it takes," the UK Treasury chief said.

- Zelenskyy welcomes additional support

Zelenskyy welcomed the announcement and said that the aid package included £7 billion in economic support for Kyiv over the next three years and another £3 billion in British export support.

In a statement on US social media company X, Zelenskyy described his phone call with Burnham as "great."

He said the export support would be allocated "primarily for the supply of much-needed weapons that will strengthen our protection of lives."

Zelenskyy said the additional funding was separate from the annual assistance London already provides to Ukraine.

He described the decision as a "truly strong" and "very timely" step that came "right as Russia needs to see and feel that Ukraine will not be left alone to deal with the problems Russia is so eager to escalate."

"Every step to strengthen Ukraine brings Russia closer to realizing that it must end this war of its own making," Zelenskyy said.

He added that he and Burnham also discussed sanctions policy.

"I am grateful to Britain, to Prime Minister Andy Burnham and his team, and to every person around the world who understands that standing with Ukraine is the right thing to do – that it means being on the right side of history," he said.

Aysu Biçer,Burç Eruygur