London Daily

Focus on the big picture.
Friday, Aug 22, 2025

Cost of living crisis: Britons on £45,000 will need help paying energy bills, chancellor says - as experts warn price cap could rise to £7,700

Cost of living crisis: Britons on £45,000 will need help paying energy bills, chancellor says - as experts warn price cap could rise to £7,700

Nadhim Zahawi also told The Daily Telegraph that households must try and reduce their energy consumption, and that he fears gas prices could remain elevated for another two years.

Britons on £45,000 salaries will need government help to pay their energy bills - not only people on benefits, the chancellor has warned.

Nadhim Zahawi also told The Daily Telegraph that households must try and reduce their energy consumption, and that he fears gas prices could remain elevated for another two years.

Energy bills will soar for millions of families in the autumn after the price cap was increased to £3,549 a year - a record rise of 80%.


Every household in the UK is being given a £400 rebate on their energy bills, but Conservative leadership candidates Liz Truss and Rishi Sunak are being urged to take further action.

There has been debate over whether additional support should be distributed widely or concentrated on those with the lowest incomes.

Mr Zahawi told the newspaper: "My concern is there are those who aren't on benefits. If you're a senior nurse or a senior teacher on £45,000 a year, you're having your energy bills go up 80% and will probably rise even higher in the new year - it's really hard."

Although Universal Credit is a "really effective way of targeting", he said, other ideas are being explored "to make sure we help those who really need the help".

Mr Zahawi is understood to have drawn up a series of options for the next prime minister to consider - and despite calls for urgent action from the energy regulator Ofgem, Ms Truss has said it would not be "right" to announce her full plans for tackling the cost of living crisis until a new Tory leader is named on 5 September.

The chancellor went on to warn that the UK is "in a national economic emergency", adding: "This could go on for 18 months, two years, if Putin continues to use energy as a weapon."

Meanwhile, forecasts of what the next capped energy price for 24 million households could be have continued to rise.

The energy price cap, which is set to nearly double from already record highs at the start of October, is currently predicted to reach £5,600 by the start of next year.

But energy consultancy firm Auxilione has now warned the the average household could be paying a £7,700 bill from April 2023 - with gas costing consumers 34.22p per kWh.

Businesses fear rising energy bills


In other developments, 26% of small and medium-sized enterprises polled by YouGov have warned that their energy bills will be unsustainable within 12 months.

Of the companies already paying more for gas and electricity, 75% said they will have to pass these costs on to their customers.

Five percent of businesses polled said that their energy bills are already unaffordable.

Mr Zahawi told The Telegraph that the government is planning to offer support to small firms, and said there would be a "longer-term scarring effect on the economy" without it.

Proposals could include cutting VAT for particular sectors - returning to a policy that was in force during the coronavirus pandemic.

Conservative MP Robert Halfon, a supporter of Mr Sunak, admitted that the situation is "grim" for families and businesses.

He told Sky News on Saturday morning: "There's a fish and chip shop in my constituency that's seen takings go down by £5,000 a month, while their energy bills have gone up from £800 to £3,000 pounds a month.

"My local GP surgery, his gas for the surgery is currently £10,000, going up to £24,000 a year. Clearly, this is unsustainable."

Mr Halfon said he supports Mr Sunak's plans to give £1,200 to eight million vulnerable families, a £400 rebate to all UK households and a cut in national insurance for 70% of households.

Politicians feel the heat


In all, around 24 million households will be hit by the price rise.

Soaring wholesale gas costs - fuelled by Russia's invasion of Ukraine - have driven the energy price cap increase, which is widely expected to spiral even further next year, with average bills forecast to hit £5,386 in January and £6,616 in April, according to analysis by Cornwall Insight.

It ramps up the squeeze on households already wrestling with soaring food and fuel prices.

Sky News has found a third of households are already struggling to pay their energy bills, while Philippe Commaret, managing director of energy giant EDF, says half of UK households could be in fuel poverty in January.

Ofgem chief executive Jonathan Brearley told Sky News that the price cap will be "devastating news" for many people.

Putting the increase into context, he said: "When I look at the prices for winter now for buying the gas, they are 15 times what they normally are. If that were to happen in petrol, that would mean it would cost £400 to £500 to fill our car."

Boris Johnson has stressed he will leave major decisions on additional support to his successor.

Ahead of the increase, frontrunner Ms Truss said she would use an emergency budget to "ensure support is on its way" if she becomes prime minister.

Her rival Mr Sunak has pledged more targeted support and to remove VAT from energy bills.

Labour has claimed that Ms Truss's plans to combat the cost of living crisis would leave four million families "out in the cold" if further direct support is only rolled out to those on benefits.

Newsletter

Related Articles

0:00
0:00
Close
Ukraine Declares De Facto War on Hungary and Slovakia with Terror Drone Strikes on Their Gas Lifeline
Animated K-pop Musical ‘KPop Demon Hunters’ Becomes Netflix’s Most-Watched Original Animated Film
New York Appeals Court Voids Nearly $500 Million Civil Fraud Penalty Against Trump While Upholding Fraud Liability
Elon Musk tweeted, “Europe is dying”
Far-Right Activist Convicted of Incitement Changes Gender and Demands: "Send Me to a Women’s Prison" | The Storm in Germany
Hungary Criticizes Ukraine: "Violating Our Sovereignty"
Will this be the first country to return to negative interest rates?
Child-free hotels spark controversy
North Korea is where this 95-year-old wants to die. South Korea won’t let him go. Is this our ally or a human rights enemy?
Hong Kong Launches Regulatory Regime and Trials for HKD-Backed Stablecoins
China rehearses September 3 Victory Day parade as imagery points to ‘loyal wingman’ FH-97 family presence
Trump Called Viktor Orbán: "Why Are You Using the Veto"
Horror in the Skies: Plane Engine Exploded, Passengers Sent Farewell Messages
MSNBC Rebrands as MS NOW Amid Comcast’s Cable Spin-Off
AI in Policing: Draft One Helps Speed Up Reports but Raises Legal and Ethical Concerns
Shame in Norway: Crown Princess’s Son Accused of Four Rapes
Apple Begins Simultaneous iPhone 17 Production in India and China
A Robot to Give Birth: The Chinese Announcement That Shakes the World
Finnish MP Dies by Suicide in Parliament Building
Outrage in the Tennis World After Jannik Sinner’s Withdrawal Storm
William and Kate Are Moving House – and the New Neighbors Were Evicted
Class Action Lawsuit Against Volkswagen: Steering Wheel Switches Cause Accidents
Taylor Swift on the Way to the Super Bowl? All the Clues Stirring Up Fans
Dogfights in the Skies: Airbus on Track to Overtake Boeing and Claim Aviation Supremacy
Tim Cook Promises an AI Revolution at Apple: "One of the Most Significant Technologies of Our Generation"
Apple Expands Social Media Presence in China With RedNote Account Ahead of iPhone 17 Launch
Are AI Data Centres the Infrastructure of the Future or the Next Crisis?
Cambridge Dictionary Adds 'Skibidi,' 'Delulu,' and 'Tradwife' Amid Surge of Online Slang
Bill Barr Testifies No Evidence Implicated Trump in Epstein Case; DOJ Set to Release Records
Zelenskyy Returns to White House Flanked by European Allies as Trump Pressures Land-Swap Deal with Putin
The CEO Who Replaced 80% of Employees for the AI Revolution: "I Would Do It Again"
Emails Worth Billions: How Airlines Generate Huge Profits
Character.ai Bets on Future of AI Companionship
China Ramps Up Tax Crackdown on Overseas Investments
Japanese Office Furniture Maker Expands into Bomb Shelter Market
Intel Shares Surge on Possible U.S. Government Investment
Hurricane Erin Threatens U.S. East Coast with Dangerous Surf
EU Blocks Trade Statement Over Digital Rule Dispute
EU Sends Record Aid as Spain Battles Wildfires
JPMorgan Plans New Canary Wharf Tower
Zelenskyy and his allies say they will press Trump on security guarantees
Beijing is moving into gold and other assets, diversifying away from the dollar
Escalating Clashes in Serbia as Anti-Government Protests Spread Nationwide
The Drought in Britain and the Strange Request from the Government to Delete Old Emails
Category 5 Hurricane in the Caribbean: 'Catastrophic Storm' with Winds of 255 km/h
"No, Thanks": The Mathematical Genius Who Turned Down 1.5 Billion Dollars from Zuckerberg
The surprising hero, the ugly incident, and the criticism despite victory: "Liverpool’s defense exposed in full"
Digital Humans Move Beyond Sci-Fi: From Virtual DJs to AI Customer Agents
YouTube will start using AI to guess your age. If it’s wrong, you’ll have to prove it
Jellyfish Swarm Triggers Shutdown at Gravelines Nuclear Power Station in Northern France
×