Think Tank Urges Labour Government to Launch Energy Social Tariff
The Department for Work and Pensions has been advised to implement a new social tariff aimed at assisting vulnerable households grappling with the ongoing energy crisis. The Resolution Foundation, a prominent think tank, has called on the Labour Party government to take decisive action in this regard.
Report Highlights Need for Targeted Support
In a report released on Wednesday, March 18, the Resolution Foundation emphasized that smart, targeted measures are essential, rather than repeating what it described as wasteful and costly universal support schemes. The think tank argued that current pressures, exacerbated by the Middle East conflict, have brought domestic cost of living concerns back to the forefront, with energy bills being a particularly acute issue.
Ruth Curtice, Chief Executive of the Resolution Foundation, stated: "These pressures will be most acute with energy bills, where support should be prioritised. But with rising gas prices today only likely to hit home this winter, the Government must resist pressure to rush out updated versions of old support schemes like the universal blank cheque approach of Liz Truss."
Proposed Social Tariff Details
The report advocates for a social tariff scheme that would offer a discounted price for lower-income families. According to the Resolution Foundation's modelling, a £3.7 billion package could provide average support of £310 for the poorest tenth of households. For families with high energy needs, this support could increase to a significant £520.
Curtice further explained: "Instead, it should think smartly about how new support can target vulnerable families with lower incomes and high energy needs. The best way to do this is with a discounted price for lower-income families. The Government should start designing a scheme with energy companies now, so that it is operational in time for when temperatures start to drop."
Administration and Implementation
The DWP is likely to be responsible for administering such a scheme. The think tank's recommendations come at a time when petrol prices remain lower than pre-pandemic levels, and actions on fuel duty are deemed insufficient to aid poorer families facing financial hardships.
The Resolution Foundation's call to action underscores the urgency of addressing energy affordability through structured, long-term solutions rather than short-term fixes. This approach aims to ensure that support reaches those most in need as winter approaches.
