Rishi Sunak announced a series of payments to UK households struggling with the deepening of the cost of living crisis last week.
The chancellor confirmed the introduction of an “extraordinary tax” on energy giants and doubled the £ 200 energy discount.
It comes after Ofgem CEO Jonathan Brearley said the energy price cap could rise between £ 830 and £ 2,800 in October.
Here’s what you need to know.
What is the reduction of the energy bill?
The original plan, announced earlier this year, was for households to receive a £ 200 rebate on their energy bills in October, with the government bearing the costs.
This discount would have been refunded for five years from 2023, with customers paying an additional £ 40 on their bills each year.
However, on Thursday the chancellor announced that the discount would be increased to £ 400 and would no longer be refunded.
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Who is eligible for the £ 400 discount?
All households in England, Scotland and Wales will receive a payment of £ 400 to help offset the growing increase in energy bills from October.
All households with a home electrical connection will be eligible for the grant automatically.
When will I receive the money?
Energy suppliers will send the money to homes with a home electricity meter for six months, starting in October.
Direct debit and credit customers will have the money credited to their account, while customers with prepaid counters will have the money applied to the meter or will be paid by voucher.
What else did Rishi Sunak announce?
The £ 650 payment was one of a series of measures announced by the chancellor:
Extraordinary tax
Al, although Sunak did not use the word “windfall” after spending months opposing the measure, it did announce a “tax on energy profits” to raise about £ 5bn in a year. .
This temporary single tax will affect 25 percent of oil and gas companies on extraordinary profits, which have increased due to the invasion of Ukraine and the coronavirus pandemic.
An 80 per cent investment allocation was also announced to calm the Conservative Party’s nerves as the measure will affect the investment of North Sea companies to save them 91 pence for every £ 1 they spend.
£ 650 means proven payment
Sunak also announced a single payment of £ 650 designed to help some of the most vulnerable people in the UK.
According to government guidelines, the £ 650 payment will be made to more than eight million households receiving the following proven resource benefits:
- Universal credit
- Grant for people looking for income-based work
- Employment related to income and support allowance
- Income support
- Labor tax credit
- Tax credit for children
- Pension credit
Directed measures
Single separate payments of £ 300 will also go to pensioners and £ 150 to those receiving disability benefits.