Category Archives: UK cost of living crisis

No one should be cut off if they can’t afford energy bills, says Zahawi

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UK chancellor says more help will be provided to heat homes this winter but does not explain how

The chancellor, Nadhim Zahawi, has said households should not be cut off if they cannot afford their energy bills, as the Treasury examines a range of options to help consumers cope with the cost of living crisis.

Zahawi promised that the government would expand on the £37bn package of aid announced earlier this year to help households tackle soaring energy costs. He told Sky News: “No one should be cut off because they can’t afford their bills.

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Network Rail braces for £1bn energy bill as costs increase by more than 50%

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Cost of electricity for running trains alone is expected to increase from £595m to £885m in 2023-24

Network Rail is bracing for a £1bn energy bill for the first time in the history of Britain’s railways, as the energy crisis is forecast to increase its costs by more than 50% over the next financial year.

The cost of traction – providing the electricity for running electric trains – is expected to increase to £885m in 2023-24, Network Rail said, up from £595m this year.

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Energy price inflation: how the UK and EU could fight it

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What can be done about rising prices – and would nationalising gas and electricity firms help?

Governments across Europe have been funding relief measures to help people with energy and petrol bills. The UK announced a £15bn package in May, largely in the form of cash payments to households, while EU member states are estimated to have spent €280bn (£243m) over the past year on everything from subsidies and price caps to one-off payments. But bills for households and businesses are reaching unsustainable levels, with further increases expected next year, sharpening the debate over whether ministers should be intervening directly in energy markets to help bring prices down.

As Russia threatens to further reduce gas supplies, politicians in Italy, Spain, Greece and the Czech Republic are among those pushing for coordinated action. The European Commission president, Ursula von der Leyen, said on Monday Brussels was considering measures to be adopted by the 27 member states. What are the options?

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Demand for crisis support soars even in wealthy UK towns

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Citizens Advice in affluent Wokingham says requests for help have nearly doubled in a year

A growing number of people in one of the most affluent areas of the country are struggling financially because of a huge spike in energy bills and the soaring cost of living, according to the chief executive of Wokingham Citizens Advice.

Many people who have been “just about managing” are now slipping into poverty and debt in Berkshire, said Jake Morrison, making him fearful for poorer regions throughout the country.

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Food banks warn surge in demand will prevent feeding hungriest this winter

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Exclusive: Nearly 70% of providers say they may need to turn people away or shrink the size of emergency rations

Food banks across Britain have warned of a “completely unsustainable” surge in demand that will prevent them feeding the hungriest families this winter.

Organisations representing 169 food banks told the Guardian the number of people seeking emergency help had already grown “dramatically” and predicted “bleak and disturbing” weeks ahead.

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UK food price inflation hits highest level since global financial crash

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Prices in shops rose by 5.1% in August, British Retail Consortium finds, as the war in Ukraine pushes up prices up for farmers

The rapidly rising price of food including milk, margarine and crisps pushed August shop price inflation to the highest levels since 2008 as the war in Ukraine raised costs for farmers.

Prices in shops rose by 5.1%, a big increase from 4.4% in July, as food producers passed on increases in the cost of fertiliser, wheat and vegetable oils, large amounts of which are produced in Ukraine and Russia, according to data from the British Retail Consortium (BRC) and market research firm NielsenIQ.

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Gypsies and Travellers fear missing out on energy bills support

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Government urged to ensure thousands living in park homes in Great Britain receive £400 payments

Gypsy and Traveller groups are calling on the government to ensure thousands of households living in park homes are not excluded from its energy bills support scheme this winter as bills soar.

The scheme will pay out a total of £400 to all households in Great Britain with a domestic electricity connection between October and March, with monthly payments administered by their energy supplier.

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UK credit card borrowing rises at fastest rate in 17 years

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Spike in inflation and threat of rising energy prices likely to add to cost of living crisis, say analysts

Credit card borrowing jumped in June at its fastest annual rate in 17 years as struggling households appeared to rely on extra borrowing to cope with the escalating cost of living.

Credit card borrowing rose by £740m month on month, 13% higher than the year before, according to Bank of England figures that showed the biggest year on year rise since October 2005.

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‘Campaigning to keep the lights on’: the desperate plight of England’s schools and universities

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Despite their costs going ‘through the roof’, education leaders fear they will be a low priority for the next occupant of No 10

Education leaders in England fear one thing: that schools, colleges and universities will be hammered by the cost of living crisis but will not be enough of a priority to get the help they need from government. And they see little hope from a change in leadership at No 10.

“Our costs are going through the roof, our staff badly need pay rises and are going to strike, our students are suffering, but our income is stuck,” said one vice-chancellor, echoing their peers in schools and colleges around the country.

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Leading Tories call on new PM to tackle crisis facing schools over soaring costs

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Exclusive: warnings of damage to children’s education for years to come without major intervention

• ‘It’s heartbreaking’: England’s school leaders on budget shortfalls

Leading Conservatives including two former Tory education secretaries have urged the incoming prime minister to address rising cost pressures on schools as a matter of urgency, as head teachers struggle to pay soaring energy and wage bills.

With the start of the new academic year just days away, many schools in England are already overwhelmed by energy price rises in excess of 200% – with worse to come – plus the additional cost of unfunded pay rises and mounting inflation.

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People on £45,000 could struggle with bills, says chancellor

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Nadhim Zahawi says energy price hike will be ‘really hard’ for middle-earners, as well as society’s most vulnerable

People earning around £45,000 a year, as well as those on benefits, could need government help to pay their energy bills this winter, the chancellor has said.

Britain’s energy industry regulator, Ofgem, on Friday confirmed an 80% rise in the consumer price cap from October that will take a typical household’s gas and electricity bill from £1,971 to £3,549 a year.

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Liz Truss taking risk by not announcing energy plan – if she has one

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Tory MPs are jittery while Keir Starmer is gaining traction with his plan for a price freeze

It is the biggest energy crisis for decades, with experts warning that people may freeze to death this winter and many will turn off their heating altogether.

But Liz Truss’s leadership campaign has barely reacted to the news that bills will have almost tripled in a year, beyond the vague promise of help to come.

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Rising energy bills put millions of UK households at risk of winter catastrophe

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Experts say 80% price cap increase will plunge people into destitution and cause avoidable deaths

Millions of households are bracing for a winter catastrophe of rising energy bills that experts say will plunge people into destitution and cause an increase in avoidable deaths without urgent government support.

After Britain’s energy industry regulator confirmed an 80% rise in the consumer price cap from October that will take a typical household’s gas and electricity bill to £3,549 a year, there were stark warnings about its potentially devastating effects.

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Truss and Sunak clash on energy costs at penultimate Tory hustings

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Truss remained loath to ‘bung money’ at those struggling to afford spiralling bills, Sunak said millions may be forced into destitution

Liz Truss has doubled down on her reluctance to “bung more money” at those who will struggle to afford spiralling energy costs this winter while Rishi Sunak said millions may be forced into destitution without extra support, as the pair clashed at the penultimate hustings of the Conservative leadership race.

With energy regulator Ofgem expected to raise the price cap to £3,500 a year from October for the average dual-fuel tariff, Truss warned the issue of spiralling fuel costs was not a short-term one. “If people think this problem is going to be over in six months they are not right. This is a long term problem,” she told the audience in Norfolk.

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Truss and Sunak face Tory hustings after both say Covid lockdown went too far – as it happened

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Latest updates: Tory leadership frontrunner reacts to Sunak comments, saying school closures went too far; pair meet Tory members in Norwich

Lee Cain, who was director of communications in Downing Street during the early phase of the Covid crisis, says Rishi Sunak’s comments about the lockdown policy (see 9.22am and 9.47am) are “simply wrong”.

But Sunak is not saying lockdown should not have happened, as Cain suggests. He is just saying that it was implemented too rigidly, and perhaps for too long, and that more consideration should have been given to the downsides.

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British Gas to donate 10% of profits to struggling customers

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Company’s owner, Centrica, says extra support will begin in autumn and last for the ‘duration of the energy crisis’

British Gas has announced it will donate 10% of its profits to help its poorer customers manage rising gas and electricity bills for the “duration of the energy crisis”.

Ahead of an expected rise in the price cap on energy on Friday, the company’s owner, Centrica, said it would donate £12m this autumn into an existing support fund. Grants of £250 to £750 would be given to poorer customers, and the pledge to donate 10% of profits every six months would last for the duration of the energy crisis “backdated to the start of 2022”, it added.

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Economists demand urgent action on energy bills to avert ‘catastrophe’

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Millions of vulnerable people will be harmed without radical policies to ease cost of living crisis, say experts

Physical and financial harm will be caused to millions of vulnerable families unless the government takes action to avert a winter catastrophe by cutting energy bills, leading economists have warned.

In the run-up to the announcement of the new energy price cap tomorrow the Resolution Foundation thinktank said radical policies such as price freezes, solidarity taxes or lower social tariffs were needed to prevent the cost of living crisis worsening.

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Workers’ anger at cost of living as strong as time of poll tax riots, union boss says

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Sharon Graham, head of Unite, on picket line with Felixstowe dock strikers, says people could rise up again as they did in the 1990s

British workers are at breaking point, with anger over the cost of living crisis reaching a level not seen since the poll tax riots of the 1990s, the head of one of the UK’s most powerful trade unions has said.

Sharon Graham, the general secretary of Unite, said frustration at pay failing to keep pace with soaring inflation was spilling over into a wave of strike action that would extend from a summer of discontent into the winter.

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Next PM could face £23bn autumn spend to cover £900 rise in energy bills

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Energy prices have soared above prediction and subsidies will require significant further spending

Ministers could face an additional £23bn price tag for covering extra household energy costs of £900 this autumn, rising to £90bn next year, a new paper by the Institute for Government has found.

The paper, looking at the options for Liz Truss or Rishi Sunak in No 10, also warned the government should plan for prolonged rises in energy bills by going a lot further in making public appeals to use less gas – for example by informing consumers about the cost savings from turning down thermostats – and in committing to building more energy efficient homes to help protect consumers.

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Tory leadership hustings – Birmingham: Liz Truss confirms she will allow new grammar schools – as it happened

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This live blog is now closed. You can read our latest story on the leadership contest here:

The cross-party Commons Treasury committee has expressed concerns about reports that Liz Truss, the frontrunner in the Tory leadership contest, may hold an emergency budget in September without asking the Office for Budget Responsibility to update its fiscal and economic forecast.

The OBR usually publishes a new forecast alongside a budget, and it provides an independent assessment of what impact the budget measures will have. The system was put in place by George Osborne to discourage the Treasury from making dubious claims about what its tax and spending announcements might be able to achieve.

OBR forecasts provide transparency and reassurance to the markets on the health of the nation’s finances. As a committee, we expect the Treasury to be supporting and enabling the OBR to publish an independent forecast at the time of any significant fiscal event, especially where, unlike other recent fiscal interventions, this might include significant permanent tax cuts.

Whether such an event is actually called a budget or not is immaterial. The reassurance of independent forecasting is vital in these economically turbulent times. To bring in significant tax cuts without a forecast would be ill advised. It is effectively ‘flying blind’.

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