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Fuel Bank cautiously welcomes Chancellor’s statement

May 26, 2022

Fuel Bank cautiously welcomes Chancellor’s statement Featured Image

Today, Chancellor of the Exchequer Rishi Sunak announced a further package of financial support to help ease the pressure on households created by rising fuel prices and the cost-of-living crisis.

Matthew Cole, head of Fuel Bank Foundation, said:

“We cautiously welcome the measures announced by the Chancellor to mitigate the impact of the energy price rises and the general cost of living increases on the poorest households and the most vulnerable in society.

“The people we help – those who prepay for electricity and gas – need surety in what they will be paying for energy and the financial help available to them this coming year.

Ofgem’s announcement on Tuesday brought into focus the fact that energy bills will have gone from £1,300 to £2,800 in just 12 months and show no signs of reducing in the short to medium term. The support measures announced today will provide much needed reassurance.

“Targeting money where it will deliver the most benefit is key, and so the material additional support for low-income families is essential and very much welcomed. However, the £400 grant to all households could have had a greater impact if a higher amount was provided to the poorest, who don’t have any room in their budgets to absorb the unprecedented price rises and will go cold or without food this winter. For some, a £400 grant is a lifeline, while for others it’s a nice to have.

Only time will tell if the support package announced today is enough to cushion the financial blow for those with prepayment meters, who will be hit hardest by the energy price cap increase in October.

“The average prepayment energy customer will need almost £400 to keep their meter topped up in January alone. For someone who lives off the gas grid and relies on heating oil, the cost to fill a tank will be more than £1,000.  Today, however, those who need help the most will be in a much better position than feared.

“Analysts predict that we are in a period of high energy prices, rather than at a peak that will subside quickly. It’s therefore essential that government addresses the amount of energy households use, since this is also a way to reduce bills. Following on from today’s statement, we welcome the opportunity to assess how additional longer-term funding is made available to better insulate homes, at pace, of some of the poorest in society so we can move beyond having to provide crisis financial support to keep homes warm.”