Emergency budget needed to tackle cost-of-living crisis, says TUC

Energy bills will rise at least 10 times faster than wages this year, the union body warned.

31 March 2022

Union leaders are calling for an emergency budget to help working families who are at “breaking point” because of the cost-of-living crisis.

The Trades Union Congress (TUC) said pay and benefits will be “swallowed up” by higher bills and inflation, with households hit with crippling new energy bills as the price cap rises on Friday.

The union body said measures announced in the Chancellor’s spring statement last week were “woefully inadequate”, warning of the worst living standards crisis in generations

The TUC said the Chancellor should return to Parliament to announce fresh economic support, including an increase in the minimum wage to at least £10 an hour, new grants paid for by a windfall tax on energy and oil company profits and an increase in Universal Credit.

The TUC estimated that energy bills will rise at least 10 times faster than wages this year.

TUC general secretary Frances O’Grady said: “People shouldn’t be struggling to cover the basics, but millions of families have been pushed to breaking point by spiralling bills and soaring inflation.

“This is a living standards emergency. Rishi Sunak must come back to Parliament and present an emergency budget. We need a proper package of economic support for families.

“Britain faces the worst living standards crisis in generations.  We need an emergency budget to bring down energy bills and to boost pay, Universal Credit and pensions.”

The TUC added that the Chancellor should announce further support for public services and energy intensive businesses to help them deal with sharp rises in costs.

An illustration of an online energy bill
The TUC said households will be hit with crippling new energy bills (PA)

Rachel Reeves, shadow chancellor, said: “Rishi Sunak is out of touch and his cynical political choices are making the cost of living crisis worse by hiking taxes for workers while shielding the record profits of oil and gas producers.

“The Conservatives should adopt Labour’s plans for a one-off windfall tax to provide cut household energy bills by up to £600 – and do so as fast as possible.

“The Chancellor’s spring statement was totally inadequate in addressing the realities facing working people and the least well off.”

A Government spokesperson said: “We understand that people are struggling with the rising cost of living – we can’t shield everyone from the global challenges we face but we’re putting billions of pounds back into the pockets of hard-working families across the UK.

“We are taking action worth over £22 billion next financial year to help people with the cost of their energy bills and to ensure people keep more of their money.

“We’re increasing the national insurance thresholds, saving a typical employee over £330 a year, we’ve put in place a £9.1 billion package to help households with rising energy bills, we’re boosting incomes by £1,000 on average for a full-time worker by increasing the National Living Wage, and we’re helping low-income families keep more of what they earn by reducing the universal credit taper rate.”

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