Resolution Foundation says UK budget offers limited relief to low-income households
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The think tank says the new budget’s energy subsidies are too broad and weakly focused, with support spread across households in a way that leaves many still facing high energy bills.
The Resolution Foundation said the latest UK budget offers only modest help to households facing rising energy prices, and that the measures fail to direct aid efficiently to those who need it most. According to the think-tank, the steps to reduce gas and electricity costs will give the poorest half of households an average gain of £158 this year and next, just £14 more than the £144 received by the richest half, suggesting limited precision in how the support is aimed.
Chief executive Ruth Curtice said the budget shows “a complete failure to target help at those who need it most” and described it as a “scattergun” approach that does little to address the country’s economic challenges. She added that “cost of living support is being spread far too thinly and will leave even those families receiving help facing higher energy bills than they did during the last energy price shock,” warning that the plan may not deliver the relief many people expect.
The budget includes the removal of standing charges on gas bills and a £100 energy payment for up to 20 million households in council tax bands A to D, as well as tax breaks for high-street businesses and higher taxes on banks and gambling. However, the foundation noted that the scheme relies on outdated property valuations to determine eligibility, which it says hampers effective targeting and makes the system less workable than it should be.
Chancellor John Healey defended the plan, stating that the UK is confronting a global economic storm and that the budget aims to “steer us through the global economic storms today” while charting a new course for the country’s future. Greater Manchester mayor Andy Burnham praised the energy-cost assistance and the removal of business rates for 70,000 firms, calling the measures “bold.”