Cost of living crisis: how Rishi Sunak, Liz Truss and Labour plan to help people with soaring energy bills
Here are the measures which the Tory leadership candidates and the Labour Party have put forward to help households with skyrocketing energy bills and increased living costs.
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The increased cost of living is currently affecting millions of people across the UK, with many households already struggling to afford everyday essentials.
With dire warnings that energy bills will hit record levels in the coming months, the country’s politicians are under pressure both to offer help to vulnerable families and to outline their plans to curb the crisis in the future.
But what exactly has each politician said they will do to help? From tax cuts to an energy bill freeze, here are some of the measures we could see implemented in the next few months.
What has Liz Truss promised on the cost of living crisis?
In many of the recent Conservative Party hustings events, the Foreign Secretary has outlined her preference for tax cuts over increased financial aid.
She has warned against “taking money off people in taxes and giving it back in benefits,” arguing that an increase in taxes would prevent economic growth and send the country to “penury”.
The South West Norfolk MP has rejected pleas to offer immediate help to those struggling with soaring energy bills, and her plans if she becomes Prime Minister instead include reversing the national insurance hike and the planned increase to corporation tax, both of which were introduced by Mr Sunak when he was Chancellor.
Ms Truss has claimed that her tax cuts, which will cost £30 billion, are “affordable within our current budget” - but that her opponent’s plans to raise taxes will “likely lead to a recession”.
The Tory leadership frontrunner also plans to temporarily suspend green levies on energy bills, and on the issue of energy companies profiting from the crisis, she has announced her intention to ensure those in oligopoly are held to account.
However, she added that she would “absolutely” not support a windfall tax, which would see a one-off levy imposed on energy giants profiting from skyrocketing bills, referring to it as a “Labour [Party]” idea.
Although her allies insist financial aid is not off the table, Ms Truss has largely been reluctant to make any firm commitments around increased help for vulnerable groups.
She told the Financial Times: “Of course, I will look at what more can be done.
"But the way I would do things is in a Conservative [Party] way of lowering the tax burden, not giving out handouts."
What has Rishi Sunak said about rising energy bills?
Mr Sunak has criticised many of the Foreign Secretary’s cost of living plans, saying it is “simply wrong to rule out further direct support” and even alleging that Ms Truss’ ideas put vulnerable people at risk of “real destitution”.
On his own plans, the former Chancellor has promised to give households more financial aid - but has never been more specific than saying he will increase support payments by “a few hundred pounds”.
He said in a statement: “This winter is going to be extremely tough for families up and down the country, and there is no doubt in my mind that more support will be needed.
“Bills are going up by more than anyone expected and the next government will need to act.”
Mr Sunak’s plans have come as a surprise to some, as in the early stages of the leadership contest he positioned himself as one of the most fiscally conservative candidates - condemning Ms Truss’ promises of unfunded tax cuts as “comforting fairy tales”.
But he has since admitted households need more support than he initially thought, warning Tory party voters that the country will “never forgive us” if the Conservatives do not provide more direct support to “pensioners and people on low incomes.”
What has the Labour Party put forward to tackle rising energy bills?
Labour recently unveiled a £29billion plan to tackle sky-rocketing energy bills.
The energy policy sets out plans to freeze the energy price cap at its current rate, with leader Sir Keir pledging people would not “pay a penny more” on gas and electricity bills this winter.
According to Labour, this will be primarily paid for through a windfall tax - which would see an extra tariff imposed on energy giants who have seen huge profits following the cost of living crisis.
A windfall tax was introduced in May by then-Chancellor Mr Sunak, but Labour has said an “absurd loophole”, which means oil and gas companies still receive tax relief, needs to be removed.
Sir Keir also announced plans to insulate 19million homes across the country over the next decade, equalise prices for people on prepayment metres and for those who pay bills monthly, offer support to customers not protected by the price cap, and increase the UK’s energy sustainability.
According to Sir Keir, the “fully-funded” plan will save the typical family £1,000 and keep inflation under control.
The Holborn and St Pancras MP said: “This is a national emergency.
“It needs strong leadership and urgent action.”
Director of the Institute for Fiscal Studies Paul Johnson criticised the Labour Party’s plan warning that inflation would pick up again once the subsidies ended and result in an increase in debt.
He told The Telegraph: “It’s an illusion in the sense that it will reduce interest debt payments in the short term.
“Unless you maintain these kinds of subsidies permanently, it won’t reduce them in the long run.
“Inflation will be higher later on.”
But charities such as the End Fuel Poverty Coalition - a group of around 60 charities, unions and anti-poverty organisations - welcomed the plan, with co-ordinator Simon Francis saying he hoped the announcement was “the start of politicians finally waking up to the fuel poverty crisis this winter.”