Tuesday, October 18, 2022
Where now on the cost of living crisis?
By far the most significant announcement by the Chancellor of the Exchequer yesterday was that the government could now only guarantee its cap on the unit price of energy – designed to keep average bills at no more than £2,500 – for another six months.
As the Independent points out, this u-turn on Liz Truss's promise of two years of government support could see annual household energy bills rocketing to £4,000 from April:
The Resolution Foundation estimated that the U-turn could save the Treasury up to £40bn in 2023-24 – but would allow the annual energy price cap to rise to £4,000 from April.
“The price of shielding the public finances from wholesale gas markets next year is more pressure on households, with the energy price cap now on course to hit £4,000 next April – almost double its effective level today,” said chief executive Torsten Bell.
Mr Hunt suggested the government will end universal support and look to target help for those most in need after April – but it is not yet clear who will be entitled to support, and whether it will be aimed at only those on benefits.
The End Fuel Poverty Coalition, an umbrella body for 60 charities and campaign groups, called for clarity – saying the financial cliff edge faced by millions “has now become even steeper”.
Coordinator Simon Francis told The Independent: “We thought everyone could rely on some support, but that’s been taken away. We need clarity on support for the most vulnerable as soon as possible.”~
The National Energy Action group said the prospect of the unit price cap ending after six months had created “huge uncertainty” – warning that some families were already rationing their energy usage to “dangerous levels”.
Chief executive Adam Scorer said: “Many vulnerable people were holding on by their fingertips. Government has to be very, very careful it doesn’t prise them away.”
Tory jibes that Labour only had a six month plan has now rebounded back on them as they find themselves in the same boat. But the real losers are households who are already struggling to make ends meet. This is something the government needs to get a grip on, and quickly.
As the Independent points out, this u-turn on Liz Truss's promise of two years of government support could see annual household energy bills rocketing to £4,000 from April:
The Resolution Foundation estimated that the U-turn could save the Treasury up to £40bn in 2023-24 – but would allow the annual energy price cap to rise to £4,000 from April.
“The price of shielding the public finances from wholesale gas markets next year is more pressure on households, with the energy price cap now on course to hit £4,000 next April – almost double its effective level today,” said chief executive Torsten Bell.
Mr Hunt suggested the government will end universal support and look to target help for those most in need after April – but it is not yet clear who will be entitled to support, and whether it will be aimed at only those on benefits.
The End Fuel Poverty Coalition, an umbrella body for 60 charities and campaign groups, called for clarity – saying the financial cliff edge faced by millions “has now become even steeper”.
Coordinator Simon Francis told The Independent: “We thought everyone could rely on some support, but that’s been taken away. We need clarity on support for the most vulnerable as soon as possible.”~
The National Energy Action group said the prospect of the unit price cap ending after six months had created “huge uncertainty” – warning that some families were already rationing their energy usage to “dangerous levels”.
Chief executive Adam Scorer said: “Many vulnerable people were holding on by their fingertips. Government has to be very, very careful it doesn’t prise them away.”
Tory jibes that Labour only had a six month plan has now rebounded back on them as they find themselves in the same boat. But the real losers are households who are already struggling to make ends meet. This is something the government needs to get a grip on, and quickly.
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