(Photo
Credit: Fuel
Poverty Action)
At the start of next week, Britain
will have a new Prime Minister, most likely Liz Truss. A Truss government is
likely to be the most
right-wing government in decades, combining a dogmatic commitment to
Thatcherite economics with a nationalist emphasis on the culture wars. But
regardless, Britain faces the biggest cost of living crisis since at least the
1970s. We are witnessing two lost
decades of living standard growth combined with inflation that could
reach 22%.
At the start
of next month, the average energy bill will rise
by 80%. Millions of people, potentially tens of millions, are facing the
very real prospect
of fuel poverty this autumn and winter. Regardless of the neoliberal dogma
of the new Conservative government, decisive state action is required to
mitigate this cost of living crisis.
Here, I
outline a 10 point action plan of emergency policies that the new Prime
Minister needs to enact in the coming weeks in order to alleviate the impact of
the cost of living crisis.
1. Freeze
the Energy Price Cap
If the
government goes ahead with the planned rise of the Energy Price Cap at the
start of October, millions will be pushed into fuel poverty. Initially the Liberal Democrats,
and now
Labour too, have called for October’s rise in the Energy Price Cap to be
scrapped. This should be financed by a new windfall tax on the profits of the
big oil and gas companies. If the cap is allowed to rise, it will cause
unprecedented social injustice and social hardship. This must be prevented.
Freezing the rise in the Energy Price Cap would also have another beneficial
side-effect, according to Labour, it would reduce
inflation by 4%.
2. Extend
the Energy Price Cap to all Households
Remarkably,
not all households are protected by the Energy Price Cap. Housing association
properties with communal
heating are not covered by the cap. Many such properties are used to house
elderly, vulnerable and disabled people. They are also the people who most
require to heat their homes. The Energy Price Cap must be extended to all
properties, especially all housing association properties and properties with
communal heating.
3. Extend
the Energy Price Cap to Small and Medium-Sized Businesses
Pubs have recently warned that
they risk going out of business without further protection from the government.
The same will be true for countless small businesses across the country. If the
Energy Price Cap is not extended to all small and medium-sized businesses, then
the cost of living crisis will rapidly become an economic crisis as thousands of
businesses face going to the wall and going bust. The Energy Price Cap must
therefore immediately be extended to cover all small and medium-sized businesses.
4. Extend
the Energy Price Cap to Schools
We cannot
allow schoolchildren to go cold this winter. Especially as school budgets are
already highly stretched, as schools struggle to catch up from the impact of
the pandemic. Having a warm and well-lit classroom is essential for the
learning outcomes of schoolchildren. Anything that prevents schools from using
energy this autumn and winter will have in adverse impact on children’s
education. The Energy Price Cap must be extended to all schools.
5. Extend
the Energy Price Cap to the NHS
The NHS is
already in crisis. Its budget is stretched to breaking point. The service
itself is beginning to become dysfunctional as waiting
times spiral upwards. Morale in the NHS remains very low. The additional
energy costs will stretch the NHS even further. This cannot be allowed to
happen. The Energy Price Cap must be extended to cover the entirety of the NHS
and the social care sector.
6. Rollout
Mass Home Insulation
The climate
emergency does not stop just because we are having a cost of living crisis.
However, some green policies can help to address both. The government needs to urgently
roll out the mass insulation of homes across the country. This would reduce
individual households’ reliance on energy as they would be able to keep more of
the heat they produce in their homes. This would both reduce carbon emissions
and lead to lower energy bills.
7. Double
the Household Support Fund
The Household
Support Fund is an emergency fund delivered by local councils. The funding is
used to help people struggling to afford food and to pay their energy bills. It
targets the poorest and most vulnerable. Following calls from the
Co-operative Party, the state must at least double the Household Support Fund
in order to double the help for the people at the sharp end of the cost of
living crisis.
8. Introduce
a Weekly £30 Uplift to Universal Credit
During the
pandemic, the government introduced a weekly £20 uplift for everyone in receipt
of Universal Credit. In a subsequent shameful move, the government has since
cut the £20 uplift. In order to give additional support for claimants
receiving Universal Credit, a new £30 a week uplift needs to be introduced. The
slightly higher amount is a reflection on rising prices and the rising cost of
living.
9. Extend
Free School Meals to all the Poorest Children
We cannot
allow children to go hungry this autumn and winter. That is why free school
meals must be extended to all the children of families where at least one
parent or guardian is in receipt of Universal Credit. The Liberal Democrats in
the House of Lords attempted
to bring in this change, however the proposed amendment was opposed by the
Conservatives, with most of Labour abstaining. This change must now happen. All
of the poorest schoolchildren must receive free school meals.
10. Give
all Adults a £500 Social Dividend Payment
In order to address the cost of living crisis, people need more money. On top of other measures already pledged by the government, the government must give every adult in the country a one-off social dividend payment of £500. A similar thing happened in America during the pandemic, when individuals were given up to $1,200. To ensure the maximum fairness of the policy, the dividend payment should be subject to income tax, meaning that those on higher incomes will have a proportion of their social dividend taxed back. This also makes the policy more affordable. A one-off £500 social dividend payment would be a vital lifeline for tens of millions across the country.
