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Daily Mirror
Daily Mirror
Politics
Ashley Cowburn

Richest households set to get 'twice as much help' as poorest next year, analysis warns

The UK's richest households could get twice as much support than the poorest next year under existing cost-of-living measures, according to a new analysis.

The stark finding from the Resolution Foundation comes just four days after the new prime minister unveiled a major package of support in response to a colossal increase in energy bills.

In her first policy intervention - just hours before the death of Queen Elizabeth II was announced on Thursday - Ms Truss said that energy bills for most households will be capped at £2,500 for two years.

According to the Resolution Foundation, the "energy price guarantee" will mean that bills are likely to be £1,074 lower over the next six months than energy regulator Ofgem's previous forecasts.

Together with the £400 energy bill rebate announced by former chancellor Rishi Sunak, the price guarantee will cover 76 per cent of the increase in bills compared to last winter, the think-tank calculated.

The analysis states that the total package of government support now in place to support household incomes in 2022-23 "provides no more support to poorer than richer" families.

However, it warns: "On current plans, the only part of the government's cost of living measures that are due to continue into 2023-24 are the EPG [energy price guarantee] , and the higher national insurance thresholds.

"It is also clear that the new chancellor plans to reverse the rise in national insurance rates.

"If this were to be enacted next year... then 'support' overall will be skewed more towards better off households, with the highest-income decile benefiting by £4,700 on average while the poorest tenth recieve £2,200."

New PM announced energy support package last week (Getty Images)

The Resolution Foundation added in its report - 'A Blank Cheque' - that it was "disappointing" Ms Truss had not put a cost on the package - instead delaying until a "fiscal event" later this month.

After the prime minister rejected calls for a windfall tax on the excess profits of oil and gas giants, the think-tank also warned of a "nasty sting" in terms of future taxes.

Chief executive Torsten Bell said: "Last week, the prime minister announced a simply colossal energy support package to prevent a living standards catastrophe this winter.

"The support was big, bold and - together with announcements earlier this year - amounts to over £2,200 for every household in Britain."

But he added: "Even so, families should still expect a tough winter ahead, with rich households getting twice as much cost-of-living support as poorer households next year.

"The energy price guarantee was absolutely the right thing to do in terms of providing support where it's needed.

"But, by ruling out any attempt to fund it through windfall taxes, the welcome support today could have a nasty sting in terms of higher mortgage payments and higher taxes tomorrow."

The Mirror has contacted the Treasury for comment.

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