Trade union body the TUC wants two-thirds of households to be shielded from energy price rises – paid for by an increased levy on bank profits
The TUC has called for urgent action to protect millions of hard-up households from a looming energy price shock.
The trade union body wants the government to launch an emergency social tariff for energy customers ahead of a 13% hike in Ofgem’s price cap from July 1. The increase will mean a typical annual gas and electricity bill will jump by £221, to £1,862.
Energy prices have soared since the outbreak of the Middle East war between the US and Israel and Iran. Critics say ordinary households here are feeling the impact of US President Donald Trump’s action, leading to them brand it “Trumpflation”.
The TUC says the government should deliver a permanent social tariff for both those on low and middle incomes.
Under its suggestion, those households with the lowest incomes who fell below the relative poverty line would save up to £559 per year, through an immediate 30% discount. Another group who are between the relative poverty line and average household income would benefit from a 20% reduction, worth £373 a year. Meanwhile, middle and some higher income households would also save up to £186 a year from a 10% reduction.
The combination would mean two-thirds of households would be shielded from the impact of bill increases.
The TUC accepting that providing such help could cost anything from £3.4billion to £5.9billion a year. The union body says that in large part this should be paid for by increasing the bank surcharge tax, which it claims could raise as much as £50billion over the next four years.
TUC General Secretary Paul Nowak said: “Working people must not bear the brunt of Trump’s illegal war.
“The government has rightly stepped up support for energy intensive industries – it’s now time to act on household bills too. The price cap has kept down bills for now, but the changing price cap means that from the summer, households will start to feel the pain of rising bills.
“That’s why we are calling for an emergency social tariff which will cut bills for two thirds of households – those that need it most – and retain the price cap for everyone else except the extremely wealthy minority on huge estates.
“This common-sense approach would stop punishing price rises for households and bring down inflation. It should be paid for by an increase in the windfall tax on banks, who have made eyewatering profits.
“Beyond times of crisis, we need to protect households from the rollercoaster of energy prices in a volatile global market by introducing a permanent social tariff which cuts bills for those low-income households – as well as wider moves to delink British energy prices from international wholesale gas prices.”
