Regulator Ofgem announced this week that it would be raising the energy price cap on what companies can charge in household energy bills meaning local residents face paying hundreds more, including an average £693 (54% rise) on energy bills to £1,971.
The price cap increase will affect 22 million households across the UK and applies to those who are on their energy supplier’s default tariff and is in response to rapid rises in the wholesale energy market affecting suppliers.
Firstly, he said the Government will “spread the worst of the extra costs of this year’s energy price shock over time”.
He said all energy customers would receive a discount on their bills worth £200 in the form of a loan to energy companies to lower the bills.
This money will be repaid from people’s bills in equal £40 installments over the next five years.
Secondly, the Chancellor announced a £150 council tax rebate in April for those in bands A to D. This discount will not have to be repaid.
He said 80 per cent of all homes in England will benefit from the rebate in the spring.
Lastly, he announced a discretionary fund of £150m for local authorities to help lower income households who happen to live in higher council tax properties, and households in bands A to D who are exempt from council tax.
The cost of the Government’s plan is around £9 billion.
The number of eligible Band A-D households in North Kesteven in line for the £150 tax rebate is estimated at 44,450.
NKDC officials are awaiting detailed guidance for local authorities on exactly how the rebate will work, but Council Leader Coun Richard Wright commented: “I hope households find some reassurance in seeing this provision being drawn up, given the financial difficulties many people have coped with throughout the pandemic and the additional pressure households may now face from the rising cost of living going forward.
“The planned discretionary fund for local authorities is particularly welcome in helping assist those who may not otherwise be eligible for this one-off Council Tax energy rebate but find themselves in financial difficulty.”
He went on: “We await the detailed guidance from Government on these changes and will share more with residents when this new support is available and ready to be distributed. We continue in the meantime to offer advice to anyone in our district who finds themselves struggling to cope financially, including any eligibility for existing help and signposting to other support.”
There is information available on the council’s website http://www.n-kesteven.gov.uk/energyhelp including advice on contacting your energy provider if you are struggling and schemes to help ensure homes are as energy efficient as possible, which will continue to be updated, and at www.n-kesteven.gov.uk/residents/council-tax-and-housing-benefit/ on existing financial help including Council Tax Support.
Following the Chancellor’s announcement in the House of Commons, Sleaford and North Hykeham MP Dr Caroline Johnson thanked him for his “honesty in stating that we cannot completely remove inflationary global pressures, and for his focus on supporting hard-working middle-income and low-income families.”
She added: “I want to ask about the discretionary £150 million fund. In particular, will he ensure that that funding is directed so that all those living in military family accommodation who are not eligible to pay council tax are eligible for the £150 discount?”
Mr Sunak said it was one of the categories who are exempt that he wants to get support to and ensure that they are included in the discretionary fund. “I know from our conversations that she has also highlighted those living in rural constituencies such as hers who are off the gas grid, and I hope she is reassured by my answer.”
He explained: “The council tax discount in England is through the council tax system, so it is agnostic to the heating source.”