London Daily

Focus on the big picture.
Monday, Sep 15, 2025

I understand anxiety over rising prices, says Chancellor Rishi Sunak

I understand anxiety over rising prices, says Chancellor Rishi Sunak

Chancellor Rishi Sunak has said he "understands people's anxiety... about rising prices" and insisted he will "always be listening" to concerns.

He pointed to a living wage rise and the winter fuel payment as ways the government is helping people.

But the chancellor is coming under pressure from Labour and some of his own MPs to cut the VAT on energy bills.

And minister Jacob Rees-Mogg is reported to have raised concern about a tax rise coming into force in April.

On Wednesday, the Financial Times said the leader of the House, Mr Rees-Mogg, had argued against a hike in National Insurance in a Cabinet meeting, calling instead for savings to be made in government spending.

The government says the rise will initially help tackle the backlog in the NHS, and later be invested in social care.

Asked if there were splits in the Cabinet over the tax, Mr Sunak said he had respect for his colleagues but added that it was "not a responsible thing to do" to "duck difficult decisions" and that people wanted the government to invest in the NHS and social care.

The tax rise is due to kick in during April, around the same time households could see a big rise in their energy bills.

Soaring global gas prices on the wholesale market have put pressure on suppliers, and 27 energy companies have gone bust.

Speaking in the Commons on Thursday, Conservative MP Peter Bone urged the government to cut VAT on energy bills to help consumers.

"Energy costs are not a luxury, they are a necessity, something that you can't avoid. You need to heat your home," he said.

Energy costs


Labour are also urging the government to scrap VAT on energy bills with the party's deputy leader Angela Rayner accusing the prime minister of failing "to invest in long term energy security" and that "yet again working families are picking up tab for his incompetence" at Prime Minister's Questions on Wednesday.

Liberal Democrat leader Sir Ed Davey says the warm homes discount should be increased from £140 per year to £300 and offered to more people.

Speaking to the Today programme, he said: "We've got to pay for it. But one of the other effects of the big rising global gas prices, as well as hitting people with their heating bills, is it's resulted in record profits for the oil and gas sector.

"I think at this stage, when people are going to face an average increase in energy bill of nearly £700, and these oil and gas sectors are making super-profits, it's not unreasonable to ask them to make a contribution."

Speaking from a vaccination centre in West Sussex, the chancellor said the government had put in place a series of measures to help people with energy costs.

"We announced half a billion pounds towards the end of last year to help millions of families - £100-£150 to help them get through the winter," he said.

The chancellor also cited the warm homes discount which reduces energy bills by £140, cold weather payments and winter fuel discounts.

"There is support there for people," he said, but added that he was "always listening making sure the policy we've got will support people in the way we want it to, and that's what our track record over the last year or two shows".

What are the options to tackle the energy crisis?

Abolishing VAT of 5% on energy bills would be quick and easy, but is considered a blunt instrument, as it would provide support to well-off customers who don't need it.

And for those that do need it, 5% of a possible £700 price rise is pretty small.

The government could temporarily suspend the additional levies on bills that fund green policies.

But that would be a tricky sell in some quarters, after the UK hosted a major global climate summit, and these levies are designed to reduce dependence on volatile fossil fuels.

One other option is to extend and expand the Warm Homes Discount. Currently, customers in receipt of certain benefits can apply for a one-off payment of £140.

And another option - suggested by the industry - would be to subsidise the energy companies themselves, by establishing a fund or facility which would allow them to draw down government cash when wholesale prices were very high and then pay it back when prices dipped again.


Rishi Sunak says he wants to “make sure policies we’ve got in place do help people”


Newsletter

Related Articles

0:00
0:00
Close
Poland Green-Lights NATO Deployment in Response to Major Russian Drone Incursion
Elon Musk Retakes Lead as World’s Richest After Brief Ellison Surge
U.S. and China Agree on Framework to Shift TikTok to American Ownership
London Daily Podcast: London Massive Pro Democracy Rally, Musk Support, UK Economic Data and Premier League Results Mark Eventful Weekend
This Week in AI: Meta’s Superintelligence Push, xAI’s Ten Billion-Dollar Raise, Genesis AI’s Robotics Ambitions, Microsoft Restructuring, Amazon’s Million-Robot Milestone, and Google’s AlphaGenome Update
Le Pen Tightens the Pressure on Macron as France Edges Toward Political Breakdown
Musk calls for new UK government at huge pro-democracy rally in London, but Britons have been brainwashed to obey instead of fighting for their human rights
Elon Musk responds to post calling for the murder of Erika Kirk, widow of Charlie Kirk: 'Either we fight back or they will kill us'
Czech Republic signs €1.34 billion contract for Leopard 2A8 main battle tanks with delivery from 2028
USA: Office Depot Employees Refused to Print Poster in Memory of Charlie Kirk – and Were Fired
Proposed U.S. Bill Would Allow Civil Suits Against Judges Who Release Repeat Violent Offenders
Penske Media Sues Google Over “AI Overviews,” Claiming It Uses Journalism Without Consent and Destroys Traffic
Indian Student Engineers Propose “Project REBIRTH” to Protect Aircraft from Crashes Using AI, Airbags and Smart Materials
French Debt Downgrade Piles Pressure on Macron’s New Prime Minister
US and UK Near Tech, Nuclear and Whisky Deals Ahead of Trump Trip
One in Three Europeans Now Uses TikTok, According to the Chinese Tech Giant
Could AI Nursing Robots Help Healthcare Staffing Shortages?
NATO Deploys ‘Eastern Sentry’ After Russian Drones Violate Polish Airspace
Anesthesiologist Left Operation Mid-Surgery to Have Sex with Nurse
Tens of Thousands of Young Chinese Get Up Every Morning and Go to Work Where They Do Nothing
The New Life of Novak Djokovic
The German Owner of Politico Mathias Döpfner Eyes Further U.S. Media Expansion After Axel Springer Restructuring
Suspect Arrested: Utah Man in Custody for Charlie Kirk’s Fatal Shooting
In a politically motivated trial: Bolsonaro Sentenced to 27 Years for Plotting Coup After 2022 Defeat
German police raid AfD lawmaker’s offices in inquiry over Chinese payments
Turkish authorities seize leading broadcaster amid fraud and tax investigation
Volkswagen launches aggressive strategy to fend off Chinese challenge in Europe’s EV market
ChatGPT CEO signals policy to alert authorities over suicidal youth after teen’s death
The British legal mafia hit back: Banksy mural of judge beating protester is scrubbed from London court
Surpassing Musk: Larry Ellison becomes the richest man in the world
Embarrassment for Starmer: He fired the ambassador photographed on Epstein’s 'pedophile island'
Manhunt after 'skilled sniper' shot Charlie Kirk. Footage: Suspect running on rooftop during panic
Effective Protest Results: Nepal’s Prime Minister Resigns as Youth-Led Unrest Shakes the Nation
Qatari prime minister says Netanyahu ‘killed any hope’ for Israeli hostages
King Charles and Prince Harry Share First In-Person Moment in 19 Months
Starmer Establishes Economic ‘Budget Board’ to Centralise Policy and Rebuild Business Trust
France Erupts in Mass ‘Block Everything’ Protests on New PM’s First Day
Poland Shoots Down Russian Drones in Airspace Violation During Ukraine Attack
Brazilian police say ex-President Bolsonaro had planned to flee to Argentina seeking asylum
Trinidad Leader Applauds U.S. Naval Strike and Advocates Forceful Action Against Traffickers
Kim Jong Un Oversees Final Test of New High-Thrust Solid-Fuel Rocket Engine
Apple Introduces Ultra-Thin iPhone Air, Enhanced 17 Series and New Health-Focused Wearables
Macron Appoints Sébastien Lecornu as Prime Minister Amid Budget Crisis and Political Turmoil
Supreme Court temporarily allows Trump to pause billions in foreign aid
Charlie Sheen says his father, Martin Sheen, turned him in to the police: 'The greatest betrayal possible'
Vatican hosts first Catholic LGBTQ pilgrimage
Apple Unveils iPhone 17 Series, iPhone Air, Apple Watch 11 and More at 'Awe Dropping' Event
Pig Heads Left Outside Multiple Paris Mosques in Outrage-Inducing Acts
Nvidia’s ‘Wow’ Factor Is Fading. The AI chip giant used to beat Wall Street expectations for earnings by a substantial margin. That trajectory is coming down to earth.
France joins Eurozone’s ‘periphery’ as turmoil deepens, say investors
×