In February, the then Chancellor of the Exchequer Rishi Sunak announced that eligible UK households would be offered a £400 discount to help with energy bills from October. However, this month, it was announced that, in January 2023, a new energy price cap will see bills reach as much as £4,266 per year.
Speaking on BBC Radio 4’s Today programme, Martin Lewis commented, “We’ve heard mutterings from the Rishi Sunak camp that he would increase the previous handouts that were given, but if he were to be consistent he would have to essentially double every number in that package.
“He will effectively need, if he wants to make this work, to double the numbers, especially for the poorest.”
This week, business secretary Kwasi Kwarteng and chancellor Nadhim Zahawai are set to ask energy company executives to submit a breakdown of their expected profits and payouts in an attempt to find an appropriate solution.
"Now, this is uncertain, we are only halfway through our price cap window but we are expecting a price cap in October in the region of £2800," Ofgem CEO Jonathan Brearley told the Business, Energy and Industrial Strategy committee.
"I know this is a very distressing time for customers but I do need to be clear with this committee, with customers and with the government about the likely price implications for October," he added.
In April, Ofgem announced a 54% energy price cap increase amid rocketing oil and gas prices. The expected October rise will put further pressure on households that are already struggling.
Last week, police officer Vicky Knight made headlines after she blasted Home Secretary Priti Patel over the cost of living crisis. Knight explained that she is struggling to feed her child on her £2,300-a-month wage, highlighting just how unaffordable basic necessities are rapidly becoming, even for those earning what is widely considered generous pay.
The TUC said that pay and benefits will be “swallowed up” by higher bills and 30-year-high inflation, estimating that energy bills will increase at least 10 times faster than wages this year.
The TUC has called on Sunak to announce fresh economic support, including new grants paid for by a windfall tax on energy company profits, an increase to the minimum wage to at least £10 per hour, and a boost in Universal Credit.
“People shouldn’t be struggling to cover the basics, but millions of families have been pushed to breaking point by spiralling bills and soaring inflation,” TUC general secretary Frances O’Grady. “This is a living standards emergency. Rishi Sunak must come back to Parliament and present an emergency budget. We need a proper package of economic support for families.”
Across the week, protests against the spiralling cost of living are scheduled for various parts of the country, including Newcastle, Manchester, Liverpool, Peterborough, and Cambridge.
Ian Allinson from Manchester TUC, said: “We can’t go on like this. The government can find money when it wants, wasting billions on useless PPE and writing off loans. If we stand together we can prevent the government, employers and landlords from driving more people into poverty.”