Rishi Sunak and Liz Truss
(Picture: PA Wire)The next Prime Minister will announce support for energy bills “within days” of taking office, according to reports, with the price cap expected to hit more than £3,500 on Friday.
The Chancellor, Nadhim Zahawi, is expected to say that new measures will be announced “as soon as possible” after the result of the Tory leadership contest on September 5, reported the Telegraph.
Energy bills are widely expected to top £3,500 per year for the average household from the start of October, compared to £1,971 today after Friday’s price cap announcement.
A Treasury source said: “From day one the Chancellor has been working flat out to develop options for further support.
“This will mean the incoming Prime Minister can hit the ground running and deliver support to those who need it most, as soon as possible.”
Cornwall Insight, a consultancy, has predicted bills could climb rapidly even further to a mammoth £5,341 by April 2023, leaving millions of Britons facing fuel poverty.
According to the Times newspaper, Liz Truss, the front-runner to be the next Prime Minister, held meetings with close allies on Wednesday in a bid to hash out details of a support package should she win the Tory leadership contest.
Among the options said to be under consideration is to adopt her rival Rishi Sunak’s plans to scrap VAT on energy bills and to use Universal Credit to target households which need the most support.
Ms Truss has already pledged to reverse national insurance rises and scrap green levies on energy bills, but experts have questioned whether these measures go far enough.
Alongside temporarily scrapping VAT on energy, rival Mr Sunak has pledged to provide £5 billion in support to the hardest hit households if he is successful.
Speaking a hustings of Tory party members on Thursday night in Norwich, the Foreign Secretary said she recognised that soaring energy prices were a “massive issue”, adding her new Chancellor would examine “what else needs to be done”.
Meanwhile, Mr Sunak highlighted his record with furlough during the pandemic and suggested he would offer support to those struggling with energy bills.
The Government has come under increasing pressure to provide extra support with the cost of living ahead of the price cap announcement.
Citizens Advice said that it has seen a spike in people worried about their bills already.
“We’re seeing huge numbers of people coming to us who have never had to turn to Citizens Advice before for help, who have never had problems with bills before," David Mendes da Costa, the charity’s principal policy manager, said.
“Government has a critical role in all of this and there has to be a package of support, and it has to come now.”
Torsten Bell, of the Resolution Foundation think tank, said the massive spike means that “radically rethought policy answers are needed otherwise we’re heading for thousands having their energy shut off and millions running up arrears".
