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From: Budget 2026 live: Latest updates, analysis and fact checks

Heat pump grants reported to face cuts as ministers seek savings to fund defence

The Boiler Upgrade Scheme, which offers grants of up to £7,500 towards heat pumps, is likely to be scaled back, according to reports earlier this month in the Guardian and Politico.

The reports say the energy department, DESNZ, has been told to find more than £2bn in savings. They link this to the defence investment plan. The government committed an extra £15bn to that plan but left £4.7bn still to be found, a gap the Chancellor, John Healey, is expected to face at the Budget on Wednesday.

The scheme has a budget of £2.7bn. The Guardian reported that it could be reduced rather than abolished, while other reports suggested a cut of hundreds of millions of pounds, CIBSE Journal said.

Without the grant, a typical heat pump costs about £13,600 to install, according to MCS data. Critics have called the proposed cut "short-sighted", Yahoo News reported.

The reported cut has not been confirmed by the government.

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