Chancellor Healey weighs over £1bn energy bill help for poorer households at 28 October budget

Left · 1The Guardian reported, citing sources, that Chancellor John Healey is working on plans to spend more than £1bn helping energy consumers at this month's budget, with the bulk likely to go on a bigger discount for households on certain benefits. 1 Mixed · 2The most likely option is raising the Warm Homes Discount from £150 by a further £100, funded by taxpayers rather than bill-payers as the existing discount is; the Daily Mail, citing the Guardian, says it would rise from £150 to £250 a year and is only available to households on means-tested benefits such as universal credit or housing benefit. 1 2 Mixed · 2The Guardian says final decisions have not been made, and the Treasury said decisions on tax are for the chancellor to set out at fiscal events rather than routinely commenting on rumour or speculation; the Daily Mail reports the Treasury insisted the claims were speculation three weeks before the budget on 28 October. 1 2

Mixed · 2Ministers are reportedly alarmed by forecasts that the Iran war will push the energy price cap up by as much as £442 in January, which the Guardian says would entirely erode the VAT cut on electricity announced by Prime Minister Andy Burnham; the Mail describes a rise of more than a fifth amid a Middle East crisis. 1 2 Mixed · 2Healey is reported to be set to rebuff a call from Energy Secretary Miatta Fahnbulleh to remove all levies from bills and fund them through taxation, which would cut bills for all consumers by as much as £120 but cost up to £3.2bn and be hard to reverse; the Mail calls her Net Zero Secretary and says it would cost more than £3bn. 1 2 Left · 1The Guardian adds that energy officials are working on more radical changes after the budget, such as a social tariff charging poorer households less per unit or a rising block tariff charging less for essential use, though a social tariff would need extensive data collection that would take far longer than a few weeks. 1

Mixed · 2Healey faces a tight fiscal position: the Guardian says he must fund an additional £4.7bn of defence spending and rebuild a buffer eroded by higher borrowing costs, and is likely to raise taxes, with higher bank taxes rumoured; the Mail puts the defence figure at around £5bn and says banks fear a windfall levy. 1 2 Left · 1Outside voices quoted by the Guardian urged action: Alex Chapman of the New Economics Foundation called for targeted support plus a safety net for all, and Alfie Stirling of the Joseph Rowntree Foundation said support should reach most households, target those in greatest need and lower prices to cut inflation. 1