Last Thursday the new prime minister Liz Truss, who had previously dismissed “handouts” as a way of tackling the cost of living crisis, announced a taxpayer-funded “Energy Price Guarantee” that amounts to a two-year direct grant to all households, regardless of whether they need any help or not.
The guarantee holds the cost of energy for an average household at £2,500 a year for the next two years, starting in October, and saves them about £1,800 over the next 12 months (on Institute of Fiscal Studies estimates). Wealthier households, living in bigger properties and consuming more energy, will benefit more.
