Reaction To Sunak's £15 Billion Cost Of Living Bailout

Chancellor Rishi Sunak unveiled a fresh £15billion cost-of-living bailout with every household expected to get hundreds of pounds off their sky-rocketing bills. In particular he clarified that the grant would double from £200 to £400 for all households - and would no longer be repayable.

Mr Sunak also said over eight million households on means-tested benefits will receive a one-off £650 payment, to be paid in two lump sums, one in July and one in the autumn. Furthermore, pensioner households who receive a winter fuel allowance shall also get an additional £300 one-off payment and people who receive non-means tested disability payments will get an additional £150.

Mr Sunak also announced a £500million increase for the Household Support Fund, to be delivered by councils, extending it from October until March 2023.

Martin Lewis, founder of Money Saving Expert

Consumer affairs expert Martin Lewis said “Actually, they did more than I was expecting them to do today and it will never be enough but I think this will go a long way to helping many people, especially those on the lowest incomes get through well at least this year, what happens next is another question.”

Mr Lewis also added “There are many people even on relatively decent middle incomes for whom a £1,500 a year rise in energy bills is really hard and going to have a monumental impact on their lifestyles.”

Gary Fredson, Chief Executive of renewable energy firm ESE Group, said “I agree with the windfall tax as it brings with it numerous research and development tax reliefs which will incentivise energy companies to strengthen the UK’s renewable energy infrastructure with projects such as large scale solar and wind farms. These long term solutions will increase our renewable energy output, therefore reducing the overall price of energy that isn’t green. “

Mr Fredson added “However, I do think these grants should come with some form of means-testing attached. I believe the people that don’t need the grant simply wouldn’t apply for it, saving the government money it desperately needs.

On another note, like with any crisis we should learn from it and in this instance the government should take measures to educate people on how to save money by altering their behaviours slightly such as using tumble dryers less, proper use of thermostats etc. During COVID we learnt what a difference masks made, surely we can adopt a similar principle here.”

Rain Newton-Smith, Chief Economist at the Confederation of British Industry

The Confederation of British Industry (CBI) also welcomed the government's efforts to tackle the cost-of-living issue, but expressed concern about the chancellor's new windfall tax. Rain Newton-Smith, Chief Economist at the Confederation of British Industry said Mr Sunak's package of help for households was the right thing to do.

But she added that the "open-ended nature" of the tax on fuel company profits could prove damaging to investment - which was necessary for energy security as well as reducing carbon emissions to tackle climate change. The move "sends the wrong signal to the whole sector, against a backdrop of rising business taxation elsewhere."