The Resolution Foundation has urged Prime Minister Andy Burnham to implement a £2bn emergency scheme that would cut energy bills by up to £175 for low-income households this winter. The proposal, detailed in a new report, targets families where the highest earner takes home £24,000 a year or less, aiming to ease the pressure of rising energy costs.
Targeted support for poorest families
The scheme would provide a discount on annual energy bills, reaching more than four-fifths of the poorest families in the UK. According to the Resolution Foundation, the support would be restricted to households with an income threshold of £24,000 or less, ensuring help goes to those most in need.
Jonathan Marshall, principal economist at the foundation and co-author of the report, said: “The government can get ahead of this, if it acts now. A targeted energy discount could save eligible households £175 a year and reach more than four-fifths of the poorest families, while expanding support beyond just those on means-tested benefits.”
Criticism of past energy policy
Marshall also criticised successive governments for failing to build a robust system for dealing with household energy prices. “Successive governments have failed to build a robust system for dealing with household energy prices,” he said.
The report comes as Burnham prepares to spend much of August travelling the country to hear directly from the public about how the Government can improve their lives. He is expected to announce a series of “everyday fixes” to reduce costs, promising to “pull every single lever we can to provide people with some room to breathe on the cost of living”.
Government response
A spokesperson for the Department for Energy Security and Net Zero said: “The energy secretary’s focus is bringing bills down for good. We will tackle the cost of living to make life’s essentials affordable again and bring back hope.”
The Prime Minister’s summer tour will focus on listening to people’s concerns, particularly around the cost of living. In an article for The Guardian, Burnham wrote: “I will also be asking people what action they want to see on the cost of living. Because if we want to find the problems that make everyday life harder, we need to listen to the people dealing with them.”
Commitment to cost-of-living government
Burnham emphasised his commitment to making life better, stating: “Westminster has spent too long asking people to wait for life to get better. This government is determined to make it better and to bring back hope.” He added: “My message to people is simple: this will be a cost-of-living government and we will be on your side to prevent you being overcharged, trapped or misled.”
The proposal from the Resolution Foundation highlights the urgent need for action as winter approaches, with many households facing higher energy costs. The £2bn scheme, if adopted, would provide significant relief to millions of low-income families, potentially reducing the financial strain of energy bills.
