Commons Sense

House of Commons · Ministers' Questions

Cost of Living Increase: Impact on Households

Tuesday 15 March 2022 · 13 questions

Summarised by AI from the official record, so it can contain mistakes.

Read the full transcript on Parliament.uk

At a glance

Answered 6 Partly answered 5 Not answered 0

Key points

  • Government is providing a 9 billion support package for households with high energy costs.
  • The Chancellor has imposed comprehensive economic sanctions on Russia in response to the invasion.
  • Government actions have reduced child poverty by 300,000 since 2010.

Topics (select to filter)

Questions & Answers

Q1 Steve McCabe Lab
Economy Taxation Energy
Context

Inflation is rising, impacting households' ability to afford basic necessities.

Question

What fiscal steps will the government take to help reduce the impact on households due to inflation and increasing costs?

Answer from Rishi Sunak

The Government recognise rising inflation and are closely monitoring it with the Bank of England. Policies include freezing duties, cutting tax rates in universal credit, increasing the national living wage, and a £9 billion package to help households with energy bills.

Answered
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Q2 Kim Johnson Lab Liverpool Riverside
Economy Children & Families
Context

The Resolution Foundation predicts that inflation will rise above 8%, while benefits are projected to increase by only 3%. Liverpool has a high poverty rate.

Question

Does the Chancellor believe it is not appropriate to raise national insurance contributions as costs of living increase, pushing people into poverty? Will measures be put in place during the spring statement?

Answer from Rishi Sunak

The hon. Lady mentioned children in poverty; there are now 300,000 fewer children in poverty than in 2010 due to Conservative-led Governments' actions.

Partly answered

Not addressed: Did not address the specific ask about national insurance contributions or measures for the spring statement.

How: Changes Subject

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Q3 Gerald Jones Lab Merthyr Tydfil and Aberdare
Energy
Context

Citizens Advice reports that one in six people are unable to pay energy bills, and only 14% think the October energy loan scheme will help. Energy prices may rise due to Ukraine conflict.

Question

What specific measures will be taken now to relieve pressures on households with high energy costs?

Answer from Rishi Sunak

The Government is providing a £9 billion support package, including £150 of support for four out of five households starting April and another £200 in the autumn. Councils have also received extra money for discretionary funding to help needy households.

Answered
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Q4 Marie Rimmer Lab St Helens South and Whiston
Ukraine Taxation
Context

Since the Chancellor's household loan scheme was announced, the situation has changed due to Russia invading Ukraine.

Question

When will the Treasury adapt its policies in response to the Russian invasion of Ukraine?

Answer from Rishi Sunak

The Treasury has worked with international partners to impose comprehensive economic sanctions on Russia, which is considered the most extensive set ever experienced by Russia.

Partly answered

Not addressed: Did not provide a timeline or specific action plan for adapting policies.

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Q5 Steve McCabe Lab
Economy Energy
Context

The Chancellor proposed a national insurance increase last autumn, but energy costs and other household bills have since risen sharply.

Question

If the extent of rising energy costs had been known in the autumn, would the national insurance increase still have been advocated?

Answer from Rishi Sunak

The Government reacted to rising energy bills with a £9 billion support package, providing £150 to four out of five households in April when the price cap increases. The price cap will protect further rises until autumn.

Answered
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Q6 Jake Berry Con
Economy Taxation
Context

Fuel prices have risen to over £2 per litre in some areas, leading to a significant VAT windfall for the Treasury.

Question

Will the Chancellor consider increasing mileage recovery rates from 45p to at least 60p when planning his spring statement?

Answer from Rishi Sunak

The right hon. Friend's suggestions will be considered, noting that fuel prices have been volatile; over the last few days, Brent has fallen by about 25%.

Partly answered

Not addressed: Did not commit to specific action regarding mileage recovery rates.

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Q7 Fay Jones
Energy Agriculture & Rural Affairs
Context

High heating oil and diesel prices are affecting constituents in Brecon and Radnorshire, a predominantly rural area.

Question

Can the Chancellor reassure constituents that they will be considered when planning support measures?

Answer from Rishi Sunak

The £9 billion package of support includes help by electricity meter, ensuring off-the-gas-grid households also benefit.

Answered
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Q8 Mark Harper Con
Taxation Employment Benefits & Welfare
Context

The impact of energy prices on companies' hiring capabilities and the potential for reducing the universal credit taper rate to improve employees' financial situations.

Question

What can be done to help businesses hire workers better and enable people to retain more of their income?

Answer from Rishi Sunak

The Government is cutting taxes, providing skills training, and reducing the taper rate on universal credit to increase hiring incentives. The unemployment rate has returned to pre-pandemic levels.

Answered
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Q9 Harriett Baldwin Con West Worcestershire
Local Government
Context

The question pertains to the effectiveness of different political parties in setting council tax levels at the local level.

Question

With council tax being one of the biggest items in household budgets, could the Chancellor remind the House which party tends to be the best, in a local council, for setting council tax?

Answer from Rishi Sunak

My hon. Friend makes an excellent and timely point. She knows that I know that, in this country, if people want good local services delivered for the lowest possible council tax, they need to vote Conservative.

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Q10 Pat McFadden Lab Wolverhampton South East
Energy
Context

The question relates to the need for revisiting the energy support package due to rising household energy bills and suggests a windfall tax on oil and gas companies' profits.

Question

The package on energy announced by the Chancellor last month has already been rendered obsolete by Russia's invasion of Ukraine. Some estimates of average annual household energy bills suggest that there will be rises to £3,000 or even more from October. That is a ruinous figure for many of our constituents. Will the Chancellor revisit this support package in next week's spring statement, and will he reconsider his refusal to fund help for hard-pressed households through a windfall tax on the enormous profits that oil and gas companies are making?

Answer from Rishi Sunak

It is worth bearing it in mind that, because of the price cap, households will be protected all the way through the autumn. We do not know what the price cap will be at that point. If the right hon. Gentleman knows, he is probably in the wrong line of business, and it would be good if he could tell the rest of us. Regarding a windfall tax, Conservative Members believe in getting more investment into the North sea and exploiting our domestic resources. The roundtable that my right hon. Friends the Chief Secretary to the Treasury, the Prime Minister and the Business Secretary hosted yesterday showed that there is enormous appetite to invest more in the UK. A windfall tax would put off that investment.

Partly answered

Not addressed: The response avoided addressing the specific ask for revisiting the support package and reconsidering a windfall tax.

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Q11 Pat McFadden Lab Wolverhampton South East
NHS Economy Taxation
Context

The question highlights the Government's decision to impose a tax rise during rising energy bills, questioning why this is happening and whether pre-election tax cuts are planned.

Question

Of course, there are global factors driving up energy prices and inflation in many countries, but what singles out the UK is this Government's decision to impose a tax rise on working people right when the impact of rising energy bills is hitting people the hardest. Why are the Government so determined to make the cost of living crisis worse now with these tax rises, particularly when the Treasury is briefing anyone—including the Government's own Back Benchers—who will listen that the Tory party is planning pre-election tax cuts?

Answer from Rishi Sunak

The right hon. Gentleman talks about exceptionalism with regard to policy. Part of the reason we are in this situation with energy prices is the decisions made by the previous Labour Government, in particular on nuclear energy, which we are now rapidly having to make up for. We are also committed to tackling the unprecedented backlogs in the NHS, getting the waiting lists down, and recovering from covid. Every single penny of the health and social care levy will go to the people's No. 1 priority and, although things are difficult, I know that is what people want to happen.

Not addressed: The response avoided addressing the specific ask about tax rises and pre-election cuts by discussing past Labour policies and NHS priorities.

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Q12 Derek Thomas Con
Benefits & Welfare
Context

The question concerns the reintroduction of the triple lock for pensioners facing a critical rise in living costs.

Question

I represent an area in Cornwall where a large number of people are on the state pension. I know, from conversations that I have had with the Chancellor, that he is particularly concerned about that demographic. Given the critical rise in the cost of living, I wonder whether one of the easier routes to address it would be to reinstate the triple lock for next year.

Answer from Rishi Sunak

My hon. Friend is right to highlight pensioners and to support them in the way that he does. He will know that we made a decision temporarily to move to a double lock this year because of the anomaly in the reported earnings, which would have meant a very large rise statistically that would not have been justified or fair in the circumstances. That said, I am pleased to say that pensions are now at their highest level relative to earnings in over three decades because of the Government's policy on the triple lock, and we continue to be the party that will support those who need our help.

Partly answered

Not addressed: The response acknowledged pensioners' concerns but avoided addressing the specific ask about reinstating the triple lock for next year.

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Q13 Alison Thewliss SNP
Economy Energy Benefits & Welfare
Context

The question discusses the need for an emergency package to support households and businesses hit by rising costs, suggesting measures like converting energy loans into grants and increasing benefits.

Question

Sanctions against Putin's regime are absolutely necessary, but they will add an extra layer of economic harm on top of the existing Tory cost of living crisis. The Chancellor must use the upcoming spring statement to deliver an emergency package of support to householders and businesses, whose costs have spiralled out of control. Will he turn his buy now, pay later energy loan into a grant, reinstate the universal credit uplift, increase other benefits with inflation and scrap the VAT and national insurance hike that will damage so many people?

Answer from Rishi Sunak

What we are doing is tackling the cost of energy. Unlike the hon. Lady's party, we believe in the future of the North sea and we are investing in it. We want to make sure that we promote the jobs that are there. On upcoming support for energy costs, the Scottish Government have plenty of powers on welfare and tax, and if they think that they can make a difference, they should use them.

Not addressed: The response avoided addressing the specific ask about converting loans to grants and increasing benefits by discussing energy investment in North Sea.

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