Martin Lewis has issued a warning to UK households that they can expect their energy bills to soar in April amid Jeremy Hunt’s budget u-turn.
New Chancellor Jeremy Hunt dramatically scaled back support for household energy bills and ditched tax cuts promised by his predecessor, Kwasi Kwarteng, as he seeks to restore stability following weeks of turmoil on the financial markets.
In an emergency statement, Mr Hunt said the energy price guarantee – which had been due to cap prices for two years – will end in April after which time the Government will look to target help for those most in need.
The consumer champion and Money Saving Expert founder shared a series of Tweets to warn his followers of what could be in store in April.
He said: “The projected new energy price cap, that will start in April when the price guarantee ends, will be up 73% taking a bill for typical use (use more pay more, use less pay less), from £2,500 a year to £4,350. The cap will then be down 15% in July to £3,700 a year on typical use.”
NEWS: The projected new energy price cap, that will start in April when the price guarantee ends, will be:
— Martin Lewis (@MartinSLewis) October 17, 2022
UP 73% taking a bill for typical use (use more pay more use less pay less) from £2,500/yr to £4,350
The cap will then be DOWN 15% in July to £3,700/yr typical use.
cont/d
Martin’s prediction was based on the assumption the price cap system will return in April. A Treasury review will determine exactly who will be eligible for further support.
Martin added: “If these [figures] are in the right ballpark, the promised ‘targeted help’ will need to be targeted up into the middle incomes for people to get through this. Especially if it stays at those levels for the next winter.
“This is subject to the fact that the price cap in its old form will continue which it the standard working assumption, but not yet confirmed.”
In response one follower asked: "How do they expect people to pay these sums? Some of us on pensions would be better off dead than living out our retirement in extreme stress and massive debt. I’m at my wits end now."
Another added: "I have to remortgage next year, if this happens as well my family loses everything."
The cut in dividend tax promised by Jeremy Hunt's predecessor will also go, along with VAT-free shopping for overseas tourists, the freeze on alcohol duty, and the easing of the IR35 rules for the self-employed.
Mr Hunt said the tax measures alone will bring in £32 billion after economists estimated the Government is facing a £60 billion black hole in the public finances.
In a televised statement, the Chancellor – who only took office on Friday – warned of more “tough” decisions to come.
“Governments cannot eliminate volatility in markets but they can play their part and we will do so,” he said.
Comments: Our rules
We want our comments to be a lively and valuable part of our community - a place where readers can debate and engage with the most important local issues. The ability to comment on our stories is a privilege, not a right, however, and that privilege may be withdrawn if it is abused or misused.
Please report any comments that break our rules.
Read the rules here