The Policies Announced in the Government's First Week

A new government took office on Monday 20 July 2026, and made a series of policy announcements across the days that followed.

This article sets out what was announced, when each measure is due to take effect and which parts of the UK they apply to. Figures and dates are as stated at the time of announcement and may be subject to change as legislation progresses.

VAT on domestic energy bills is to be removed.

Announced on Tuesday, the measure reduces VAT on household energy bills from 5 per cent to zero.

The change is scheduled to take effect from October. The government estimated the saving to households at approximately £45 a year.

VAT on domestic fuel and power has been charged at the reduced rate of 5 per cent rather than the standard rate. Removing it entirely reduces the total bill by that proportion, so the cash saving for any individual household depends on how much energy that household uses.

Bus fares in England are to be capped at £2.

Announced on Wednesday, single bus tickets in England are to be capped at £2 from January 2027.

The measure was set out in a statement to Parliament by the Rail Minister, Lord Hendy, described as part of a wider commitment on transport.

A national fare cap has operated in England previously at varying levels, and the announcement returns the cap to £2 for single journeys.

Bus policy is devolved, so the cap applies to England. Similar measures in Scotland, Wales and Northern Ireland are matters for the respective devolved administrations, and the announcement prompted calls in Wales for the Welsh Government to introduce comparable measures.

Business rates for pubs are to change.

A further announcement concerned business rates for pubs, forming part of the opening week's package.

Business rates are the property tax paid by non-domestic premises in England, calculated from a rateable value set by the Valuation Office Agency and multiplied by a figure set by government, with various reliefs applied.

The hospitality sector has been the subject of repeated changes to rates relief in recent years, and business rates in England are devolved in equivalent form to the other UK nations.

Several announcements apply to England only.

Because energy, transport and taxation are treated differently under the devolution settlements, the reach of each measure varies.

VAT is a UK-wide tax reserved to Westminster, so the change to energy bills applies across the United Kingdom.

The bus fare cap and business rates measures apply to England, since those policy areas are devolved. This has produced differing arrangements between England, Scotland, Wales and Northern Ireland, and calls in the devolved nations for equivalent action.

The stated framing.

The Prime Minister described the energy measure as intended to put more money in people's pockets.

The government has stated that early cost-of-living measures sit alongside a commitment to fiscal responsibility, and analysts have noted that combining the two presents a challenge for the Treasury.

Detailed costings for the measures announced were not published alongside the initial announcements.

How measures of this kind take effect.

A tax change such as the removal of VAT on domestic energy requires legislation, generally through a Finance Bill, and takes effect on the date specified in that legislation.

A fare cap operates through funding agreements with bus operators, under which government meets the difference between the capped fare and the fare that would otherwise be charged. Operators participate under the terms of the scheme.

Changes to business rates reliefs are implemented through the local government finance system, with billing authorities applying the relief and being compensated by central government.

Announcements are therefore a statement of intent, and the operative detail follows in legislation, regulations or funding agreements.

What has not yet been set out.

Several areas identified as priorities by the government had not been the subject of detailed announcements at the time of writing.

These include the specifics of proposed devolution of powers to English regions, the ten-year industrial plan referred to in the Prime Minister's first speech, and plans relating to council housing.

A fiscal event, at which tax and spending decisions are formally set out alongside independent forecasts, would be the usual point at which measures of that kind are costed and confirmed.

How announcements are recorded.

Statements of this kind are made either at a press event or, where they concern policy requiring parliamentary approval, in a statement to the House of Commons.

The bus fare announcement was made in a statement to Parliament, which means it appears in Hansard with the questions put by members afterwards.

That distinction matters for anyone following the detail, since a parliamentary statement is subject to immediate scrutiny from MPs of all parties in a way a press announcement is not.

Where to check current details.

Announcements made in the first days of an administration are subject to revision as they pass through Parliament.

The government publishes policy papers and legislation at gov.uk, and Hansard records ministerial statements to Parliament in full.

The House of Commons Library produces impartial briefing papers on individual measures, which set out how a policy is intended to operate and what is not yet known.

Share your thoughts.

Which of the measures announced would make the most difference to your household?