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The Chancellor revealed his new decisions on the cost of living. But will they be enough to help those struggling with the cost of living crisis? Political editor Robert Peston is researching
Chancellor Rishi Sunak has made a dramatic turnaround in the contingency tax to raise money for a new support package to help with living expenses.
What support did the Chancellor announce?
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Eight million of the lowest-income households – those with universal credit, tax credits, pension credit and inheritance benefits – will receive a one-off payment of £ 650. It will come in two payments; one in July and the other in the fall
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Retirees will receive an additional £ 300 through winter fuel payments
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There will be a one-time disability payment of £ 150 for those receiving personal independence payments
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Mr Sunak also doubled the planned energy support subsidy from £ 200 coming in the autumn to £ 400 and canceled planned payments.
Sunak makes a U-turn
The chancellor said the government would take an additional tax from the oil and gas giants to fund a support package to help with rising living costs.
He called it a “temporary targeted tax on energy gains”, apparently in an attempt to distance himself from Labor’s leading contingency tax policy, which he has been pushing for months.
The chancellor suggested that his plan was different from that of Labor because it would include a “new investment allowance” to stimulate reinvestment of profits.
The tax will be temporary and will be levied at 25%, but oil and gas companies can recoup 90% of it by investing in the UK energy sector.
As Rishi Sunak announces his new cost-of-living solutions, ITV News’s Sangita Lal talks to those at the forefront of the crisis.
He said the changes would allow the UK to raise £ 5 billion to provide additional support to families in need, but said the support package was worth a total of £ 15.3 billion.
An additional £ 10 billion will be raised through loans.
The chancellor said that the United Kingdom “will go through the” cost of living crisis, telling members of the House of Commons that the government “will not sit idly by while there is a risk that some in our country are so far behind that they may never recover. “
He added: “We will make sure that the most vulnerable and the poorest receive the support they need at this difficult time.”
The Chancellor’s opposite number, Rachel Reeves, said Labor was winning the “battle of ideas in Britain” as it took credit for the new energy tax.
The shadow chancellor said: “It seems that the chancellor has finally realized the problems facing the country. We first called for an unforeseen tax on oil and gas producers nearly five months ago to help families and retirees in difficulty.
“Today he announced this policy, but he cannot dare to say the words: this is a policy that does not dare to say its name with this chancellor.
Mr. Sunak was amazed by shouts of “what took you so long?” And “the time has come” after he began his statement in the Municipality.
Joel Hills of ITV News analyzes how the chancellor’s statement will help different income levels.
Liberal Democrat leader Sir Ed Davy tweeted: “Sunak is like a thief who steals your car and then wants to be grateful when he returns the wheel.
“The British will not fall for the Sunak scam. They need tax cuts now to put food on the table, heat their homes and fill their cars.”
Prices in the UK are rising, with annual household bills rising by around £ 700, national insurance rising by around £ 130 and inflation – currently at a 40-year high of 9% – projected to reach 10 % this year .
Rising fuel prices are regularly breaking records, and the Budget Responsibility Office warns that the UK could enter a recession this year.
In addition, households are expected to see a further increase of almost £ 900 in their energy bills in October. “
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Families may face an increase of almost £ 900 in annual energy bills
The energy price cap, which jumped by around £ 700 in April, is expected to rise again in April, this time with a staggering increase of almost £ 900.
Ofgem CEO Jonathan Brierley told the Committee on Business, Energy and Industrial Strategy that the regulator expects an energy price cap in October “in the region of £ 2,800”, compared to the current £ 1971.
The regulator warns that a whopping 12 million households could fall into fuel poverty when the ceiling rises, almost double the 6.5 million already in this situation.
And it could get worse in October than expected, with Mr Brierley telling the committee: “It’s entirely possible [price cap] it could increase, “he added:” The variability in the gas market is huge. “
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