What Andy Burnham’s latest cost-of-living measures could mean for your bills, travel and shopping

You could soon pay less for electricity and bus travel, while proposed consumer rules could give you stronger protection against misleading discounts. Prime Minister Andy Burnham has begun announcing what the government calls a series of “everyday fixes” designed to ease pressure on your finances. The first announcements include removing VAT from domestic electricity, lowering the bus fare cap and consulting on tougher action against fake sale prices.

Some changes have already been confirmed, while others remain proposals. Here is what has been announced, when each measure should take effect and what you need to watch out for.

Your electricity bill should fall from October

From 1 October 2026, the government will remove VAT from domestic electricity bills in Great Britain for the remainder of the 2026/27 financial year. You currently pay VAT at 5% on domestic electricity. Reducing that rate to zero should cut around £45 from the annual bill used to calculate Ofgem’s energy price cap.

However, that figure is an estimate, not a £45 rebate. You will not receive a separate payment, and your supplier will not necessarily deduct exactly £45 from your account. Your actual saving will depend on how much electricity you use.

The change applies only to electricity. You will continue to pay VAT on your gas bill at the existing rate unless the government announces another change. You should benefit whether you pay by Direct Debit, standard credit or prepayment meter. The government also expects suppliers to pass the reduction on if you have a fixed-rate tariff.

That last point matters because fixing your energy price does not usually mean fixing every component of your bill. Taxes, levies and other regulated costs can change during a fixed deal. The government says suppliers should pass this particular tax reduction on to all eligible customers rather than keeping the difference.

You should check your first bill or statement covering energy used from 1 October. Look at the VAT calculation and compare it with an earlier bill if you can.

If the reduction does not appear, contact your supplier and ask it to explain:

• which VAT rate it has applied to electricity used from 1 October;
• how it has adjusted your tariff or unit price;
• whether it has included the reduction in your Direct Debit calculation; and
• how it has treated electricity used across a billing period that began before 1 October.

Your supplier might not reduce your monthly Direct Debit immediately. Energy companies usually calculate Direct Debits using your predicted annual consumption, your account balance and expected future prices. You could therefore receive the tax reduction through a lower running balance rather than an instant £45 cut to your monthly payment.

If your account builds up an unnecessarily large credit balance, you can ask your supplier to review your Direct Debit and return credit that it does not reasonably need to retain. Make sure you provide an up-to-date meter reading first so it can calculate your position accurately.

If your supplier does not explain or correct your bill, you can use Resolver to raise and manage your complaint. You can keep your correspondence and supporting evidence together, which can help if you need to escalate the issue later.

The zero rate has only been funded until 31 March 2027. The government says it will make any decision about extending the measure at the autumn Budget. You should not assume the saving will continue beyond the end of the current financial year.

Different VAT arrangements apply in Northern Ireland. The government says the Northern Ireland Executive will receive comparable funding, but you will need to wait for details of how that support will reach you if you live there.

The maximum single bus fare will fall to £2

From 1 January 2027, eligible single bus fares in England outside London will be capped at £2. The cap will run until 31 December 2027 and replace the existing £3 limit. The government has allocated £400 million to support it.

If you regularly take a bus that currently charges the full £3 capped fare, you could save £1 each way. A five-day return commute could therefore cost you £10 less each week, provided every journey qualifies. You could save considerably more against the normal commercial price on a longer route. Without the scheme, some single journeys would cost substantially more than £2.

You should not assume that every bus journey will qualify, however. The cap applies to participating services, and exclusions can include some specialist, school, sightseeing or premium services. London also operates under a separate fares system.

Before you travel, check the operator’s website or app to confirm that it participates. You should also compare the capped single fare with any weekly, monthly or multi-operator ticket you already use. A £2 single sounds attractive, but a season ticket could still work out cheaper if you make enough journeys.

Until the new cap begins, most eligible single fares outside London remain capped at £3. The reduction does not start early simply because the government has announced it.

If a participating operator charges you more than the cap for an eligible journey after 1 January, keep your ticket, receipt or app record. Contact the operator first and ask it to refund the difference. Clearly identify the service, journey time, boarding point and fare charged.

If the operator does not resolve the problem, you can use Resolver to submit and track your complaint where the service is supported. Keeping your ticket and a copy of the published fare information will give you useful evidence.

You could get stronger protection against fake discounts

Burnham has also announced plans to tackle misleading sale prices, including offers that appear more generous than they really are. You have probably seen products advertised with a large discount against a “was” price or recommended retail price. Sometimes that comparison gives you useful information. In other cases, a retailer may have increased the price shortly before the sale, used a price that rarely applied or compared its offer with an unrealistic RRP.

The government plans to consult on adding practices such as fake “was” prices, invented discounts and misleading RRPs to the list of automatically unfair practices under the Digital Markets, Competition and Consumers Act.

If the government goes ahead, regulators should find it easier to act. Instead of having to establish the misleading effect of a pricing tactic in every case, an explicitly banned practice could automatically break consumer law.

You should treat this as a proposal rather than a new right you can use immediately. The consultation is expected in autumn 2026, and the government will need to confirm the final rules and implementation date afterwards.

You already have protection against misleading prices, though. A business must not present pricing information in a way that deceives you or causes you to make a purchasing decision you would not otherwise have made. If you think a discount is fake, save evidence before the price changes again. Take screenshots showing the product, current price, claimed previous price, date and retailer. If possible, check the product’s earlier price using old listings, previous emails or a reputable price tracking service.

Raise the issue with the retailer and explain why you believe the price comparison misled you. If the advertised discount influenced your decision to buy, say so clearly.

If you cannot reach a satisfactory resolution, you can use Resolver to raise a complaint with the retailer where available. Resolver can help you keep a clear record of what happened, what outcome you requested and how the retailer responded.

Your normal refund rights will depend on what you bought, where you bought it and whether anything is wrong with it. A misleading discount does not automatically mean you can keep a fault-free shop purchase and demand compensation. However, the way the retailer marketed the product may give you grounds to challenge the transaction or report the practice to the relevant enforcement body.

Free summer bus travel for children is already available

If you travel with a child aged between five and 15, you may also benefit from free bus travel during August 2026. The scheme covers participating local bus services in England from 1 to 31 August. Children under five can already travel free with many major operators.

You should check whether your local operator participates and whether it requires proof of age. Do not assume the offer covers every coach, school bus, sightseeing service or cross-border journey. If a participating operator incorrectly charges you, keep the ticket and ask it to refund the fare. If you cannot resolve the problem directly, you can use Resolver to raise and track your complaint where the operator is supported.

Although the scheme can reduce your summer holiday costs, Burnham did not announce it after becoming prime minister. The government announced the measure on 10 July, before he took office. You can still use it, but it forms part of an earlier summer savings programme rather than his new package.

Pubs and music venues will receive business rate relief

Burnham has also announced a 20% business rate reduction for qualifying pubs, social clubs and live-music venues in England during the 2027/28 financial year.

The government estimates that the measure will save a typical pub around £1,100. It follows a 15% relief available during 2026/27, although the new scheme will not cover the very largest music venues.

You should not expect the relief to produce an automatic 20% reduction in the price of a drink, meal or ticket. Business rates form only one part of a venue’s costs, and the government has not required businesses to pass the saving directly to you. But, the measure could nevertheless help a local venue manage its costs, avoid sharper price increases or remain open. You will need to wait until the Budget for detailed eligibility rules, including the definition of venues excluded because of their size.

More help has been promised, but not yet announced

Burnham has described the current measures as the beginning of a wider series of cost-of-living changes. He is expected to make further announcements as he tours the country during August.

For now, you should distinguish between confirmed help and political promises.

The electricity VAT cut and £2 bus fare cap have defined start and end dates. The tougher rules on misleading discounts still require consultation and further government action. The business rate reduction will not begin until 2027 and will help you, as a consumer, only indirectly.

You should also be cautious about headline savings. The £45 electricity figure represents an estimated annual saving based on the price-cap calculation, not a guaranteed payment. The £2 bus cap applies only to eligible journeys on participating services. Proposed rules on fake discounts cannot protect you retrospectively as though they were already in force.

The clearest immediate step you can take is to keep good records. Save your energy statements, retain bus tickets and screenshot questionable offers. If a company fails to apply a confirmed change correctly, contact it and ask for a clear explanation and appropriate refund.

If you remain unhappy with its response, you can use Resolver to raise and manage your complaint. Keeping everything in one place can make it easier for you to show what went wrong and take the matter further.

If you have any thoughts on this topic, or any other consumer issues you would like us to cover, feel free to get in touch with us at support@resolver.co.uk 

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