Chancellor Rishi Sunak is reportedly drawing up plans for another support package to help families tackle to cost of living crisis. It comes as industry insiders predict there could be more energy prices rises in January.
According to The Times, senior government sources say the chancellor will use his autumn budget to announce more measures. It will be welcome news to families who have seen gas, electricity and fuel prices sky-rocket this year.
And industry experts have already forecast the energy price cap is likely to smash the £3,000 mark in January. It is part of Ofgem's plan to review the maximum amount energy companies can charge every three months rather than six.
In May Mr Sunak announced a package that would give every household £400 off their energy bill in October. The level of support for pensioners and those on benefits hit the £1,000 mark.
At the time, Ofgem said it expected bills for an average household to rise to £2,800. Cornwall Insight, the energy market consultancy, believes that Ofgem may have to raise October’s cap when it makes a final decision in August.
The firm has forecast a price cap of £2,980 in October, rising to £3,003 in January. At present, the cap stands at £1,971 a year.
Now, the Times says a senior source expects Mr Sunak would take measures further. His autumn budget is expected in late October or early November.
“What the autumn budget will have to do is revisit the cost of living,” they said. “A lot depends on what is happening in Ukraine but with Russia starting to restrict gas supplies then the energy cap is likely to be up and we’ll have to do something else.”
“Rishi’s view was that we had to announce the cost of living package early because until we did so no one was going to allow us to talk about anything else,” they said.
The chancellor is said to be concerned that people are so far unaware of the government support package. The newspaper said its own poll showed 52% of the public had not heard about policies designed to help with fuel bills.
Mr Sunak is also under pressure to introduce further cuts in fuel duty. Figures released by the RAC showed the average price of unleaded has hit record highs of £1.91, with diesel costing £1.99.
The RAC’s fuel spokesman, Simon Williams, said there was clear evidence that retailers were charging consumers too much. He said: “Our analysis shows the average cost of a litre of petrol is considerably overpriced. Drivers really should be paying around 186p per litre if wholesale prices were being reflected fairly at the pumps. This would see the cost of filling a 55-litre family car drop from £105 to a fairer £102.”
