Saturday, June 22, 2024
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UK plans consumer support as energy bills soar

LONDON (AFP) – Britain’s Finance Minister Rishi Sunak was to unveil a support package for consumers hit by soaring energy bills, reportedly with help from a controversial windfall tax on oil giants yesterday.

Reports suggest a government package worth GBP10 billion (USD12.5 billion) could be funded in part by an exceptional levy on soaring profits enjoyed by the likes of BP and Shell that have benefitted massively from surging oil and gas prices.

This would be a U-turn for embattled Prime Minister Boris Johnson, who has insisted such a move would hinder efforts by oil majors to invest in greener energy.

Sunak was set to address Parliament at around 1030 GMT, a day after Johnson promised to “move on” from a critical report about his leadership that allowed lockdown-breaking parties at Downing Street.

Both Johnson and Sunak were fined by police over one breach of the laws they set for the public, causing widespread outrage.

But Downing Street’s Chief of Staff Steve Barclay dismissed suggestions the announcement was timed to deflect attention from the ‘Partygate’ scandal.

“There is a huge pressure coming for families in terms of energy costs,” he told Sky News.

In paying for “targetted support”, the government needed to “look at the balance between how much is done through debt, and how much is done through revenue raising”, he added.

Britain’s annual inflation rate has surged to a 40-year high on rocketing energy costs, squeezing household budgets and leaving many struggling to make ends meet. Inflation, as measured by the consumer price index, hit nine per cent in April from seven per cent in March, recent official data showed.

Countries around the world are experiencing decades-high inflation as the Ukraine conflict pushes up energy and food prices, in turn forcing the Bank of England and other central banks to ramp up interest rates.