Mix yeast and sugar together in bowl; cover with a little lukewarm milk. Allow to sit until frothy, about 10 minutes.
Rub cold butter into flour, mixed spice and salt until it resembles breadcrumbs. Add dried fruit and chopped peel; stir remaining milk and yeast mixture into flour mixture and mix well with hands. Knead on a floured board until smooth. Place in a bowl, cover with a clean drying cloth; leave to rise in a warm place until doubled, about 60 minutes.
Knead again and divide into buns. Place on prepared tin and allow to rise in a warm place for 15 minutes.
Preheat the oven to 220 C / Gas mark 7. Grease and flour a baking tray.
Bake in the preheated oven until golden, 15 to 20 minutes.
To make the glaze, combine water and icing sugar; brush over warm buns.