Healey weighs £1bn energy support as tariff reform remains under review
The likely budget measure is a taxpayer-funded increase to the Warm Home Discount, while officials examine longer-term options for changing energy tariffs.
Chancellor John Healey is considering more than £1bn in support for energy consumers at this month’s budget, with a larger Warm Home Discount the most likely measure. The Treasury has not finalised the package.
The discount currently provides £150 off bills for households receiving certain benefits, with its cost funded by bill-payers. Healey is understood to be considering adding £100 and shifting the cost to taxpayers.
The Guardian reports Healey is expected to reject Energy Secretary Miatta Fahnbulleh’s proposal to move energy levies from bills to taxation. Removing the levies could cut bills by as much as £120, but cost up to £3.2bn, according to the report.
Officials are also developing possible tariff changes for after the budget. A social tariff would set lower unit prices for poorer households; a rising block tariff would charge less for essential energy use and more above a set level. Income-based tariffs would require extensive data-sharing and could take longer to implement.
Forecasts cited by the Guardian suggest the energy price cap could rise by as much as £442 in January, a projection rather than a confirmed increase. The final level and timing of any support, and whether tariff reforms proceed, remain undecided.
