Cost of living plan: second homes will receive £120m to help with energy bills under Rishi Sunak’s plans

Second home owners are set to receive more than £120 million from the Government in energy discounts, as part of Chancellor Rishi Sunak’s new cost of living support package.

Under the plans every home in England, Scotland and Wales will receive an automatic £400 discount on their energy bills from October.

Mr Sunak has doubled the previous offer of a £200 discount, announced in February, and has also changed the scheme into a grant rather than a loan to be repaid.

It will go to every home regardless of need – including second homes, with those who own more than two standing to benefit multiple times over.

There are more than 301,000 official second homes across Great Britain, according to figures gathered by NationalWorld from the respective nations’ governments.

If each receives a £400 energy discount, the total bill to the Government will come to £120.5 million.

In England, data from the Department for Levelling Up, Housing and Communities reveals there were 253,357 second homes across the country as of October last year.

Of these, 10,223 are currently receiving a council tax discount of between 5% and 50% on account of them being second homes. These homes will get an extra £4.1 million of help with their energy bills.

National Records Scotland figures show there are 23,890 second homes, with owners set to benefit from £9.6 million in grants.

And in Wales, there are 23,974 second homes registered for the 2022/23 tax year, Welsh government data shows, meaning another £9.6 million in support will be heading their way from Westminster.

The scheme will not extend to Northern Ireland, although the Treasury will provide funds for the devolved government to put in place an equivalent.

The Chancellor’s plans to help households with the cost of living have been broadly welcomed.

Think tank the Institute for Public Policy Research (IPPR) said that overall the energy grant was a good way to help struggling households who will not be eligible for other support, and that excluding second homes may not be logistically possible.

The Institute for Fiscal Studies (IFS) described the overall plan as “a genuinely big package of support”.

But IFS director Paul Johnson did question whether the universal approach of delivering some of Mr Sunak’s policies was the best method, rather than targeting support at those who need it most.

“Whether it’s needed for all households, I think, is more of a difficult point,” he told BBC Radio 4 on Thursday (26 May).

“£100 off for each household in the country costs, each £100, costs something like £3 billion and a lot of that money, frankly, will go to households who don’t desperately need it.

“I’m sure they’ll appreciate it, but won’t necessarily need it.”

He added: “It really will mean a lot of people who don’t need this help will get it - people who are on quite high incomes and, indeed, the very, very large numbers of households who saved a great deal over the Covid period.”

Government documents published when the Chancellor first announced a £200 energy rebate stated it would be too complex to deliver the cash via a non-universal route.

“Delivering a scheme with means-tested eligibility criteria would add to the administrative cost and complexity and would contradict the aim of a scheme designed to support all domestic electricity customers who will be experiencing the energy price shock,” it read.

The Treasury was approached for comment.