The Chancellor has set out a fresh emergency package for the cost-of-living crisis just two months after his spring statement.
26 May 2022
Chancellor Rishi Sunak has returned to the Commons to unveil a new £15 billion emergency package of measures to support households through the cost-of-living crisis.
Just two months after his last set-piece spending announcement, he announced a U-turn to hit oil and gas giants with a windfall tax to fund a raft of new measures.
With targeted support to those who need it most and a grant to ease energy bills for all households, here is a quick look at the details.
Though Mr Sunak did not use the word “windfall”, having spent months opposing the move, he did announce a “energy profits levy” to raise around £5 billion in a year.
The temporary one-off tax will hit oil and gas firms by 25% on extraordinary profits, which have surged because of the invasion of Ukraine and the coronavirus pandemic.
An 80% investment allowance was also announced in order to calm Conservative nerves that the move will dent North Sea firms’ investment to save them 91p for every £1 they spend.
– A universal grant
The Chancellor acknowledged the situation has worsened since he announced the energy bills discount, which was effectively a £200 loan.
He has doubled it to a £400 discount on bills for all households from October, and has now genuinely made it a grant that will not need to be paid back.
– Targeted measures
More than eight million of the lowest income households will receive a £650 one-off payment. It will apply to households on Universal Credit, Tax Credits, Pension Credit and legacy benefits.
Separate one-off payments of £300 will go to pensioners and £150 for those receiving disability benefits.