UK Finance Minister Rishi Sunak unveils $18 billion cost-of-living bailout package

UK Finance Minister Rishi Sunak on Thursday unveiled his government’s £15 billion (US $18.85 billion) cost-of-living bailout package to help millions of people struggling with the worst cost-of-living crisis in decades.

The announcement comes in the wake of soaring energy costs, which rose by more than 40 per cent following the Russia-Ukraine war.

Apart from the energy crisis, UK is also battling one of its highest inflation in 40 years that has severely dented the pockets of average consumers in the country, with average earnings seeing a drop by 1.9 per cent from a year earlier, the biggest decline since 2013.

With the shadow of Susan Grey's report on lockdown parties hanging over Boris Johnson’s government’s head, Sunak addressed the House of Commons, by talking about the inflation scenario, saying that the government cannot “solve every problem”.

But Sunak said he would not allow people to be “set so far back they might never recover” - boasting that cost-of-living support now totals £37billion this year.

He cautioned that inflation was becoming entrenched, saying: “Over the course of the year the situation has evolved and got more serious,” Daily Mail reported.

Among the slew of announcements include:

1) One-off payments of different amounts will be given to the most vulnerable - the elderly, those with disabilities, and those with the lowest incomes

2) All households will receive a £400 discount on energy bills

3) Eight million of the lowest income families will also get a one-off payment of £650, Sunak says

4) He confirms a temporary windfall tax on oil and gas giants to fund the payments - a move called for by Labour

Watch | UK: Rishi Sunak to unveil cost of living support package

5) There will be a one-off disability cost of living payment of £150, and pensioners will get £300

6) The UK government has also introduced a £5 billion ($6.3 billion) tax on the windfall profits of its oil and gas companies.

7) Sunak unveiled the new 25% tax on the profits of energy producers such as BP and Shell on Thursday. The levy will be phased out once oil and gas prices fall back to more normal levels, he said.

8) He said, “The oil and gas sector is making extraordinary profits, not as the result of recent changes, risk-taking or innovation or efficiency, but as the result of surging global commodity prices."

(With inputs from agencies)

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