Growing speculation that UK Government will extend help for household energy bills

There is growing speculation that the UK government will extend help for household energy bills.

According to the BBC, some energy firms are preparing to adjust bills in anticipation of such a move.

Currently, the Energy Price Guarantee caps the cost of gas and electricity, ensuring a typical household bill is limited to £2,500 per year.

From 1 April, this limit is set to increase by 20% to £3,000, leading many to call on the UK government to reconsider.

Fuel poverty campaigners have warned that this increase could result in up to 8.4 million households struggling to pay their bills, up from the current 6.7 million.

Although the government had said all bill help was under review, Chancellor Jeremy Hunt had refused to extend support.

However, experts suggest that he may change course, potentially at the Spring Budget on 15 March.

The Institute for Fiscal Studies has indicated that the Treasury could maintain current levels of support until summer due to falling wholesale energy prices.

UK government had previously said all help for bills is under review.

Energy UK, which represents suppliers, has urged the government to announce a decision quickly so firms can adjust their billing.

The BBC’s business editor Simon Jack writes:

“At the moment, the government is limiting the typical household bill to £2,500 a year, plus a £400 winter discount, which will also end from April.”

“From 1 April, the help is scheduled to be scaled back, which will push bills up.”

“However industry sources told the BBC that some energy companies have already started amending future bills to reflect that energy help will continue at or very near to current levels beyond 1 April.”

He added: “A Treasury source declined to comment on speculation.”

Money saving expert Martin Lewis said he is “85% sure” the UK government will not increase prices by 20% as planned in April.

I will be doing the @BBCr4today at 8:30am to discuss why I am now 85% sure the govt will NOT increase prices by 20% as is planned in April. And instead will keep it as, as I’ve been campaigning for.

— Martin Lewis (@MartinSLewis) March 3, 2023