finance

Rishi Sunak launches £500m fund to help struggling families


The government has said it will launch a £500m fund for councils to support poorer families through the winter amid an energy supply crisis and the withdrawal of other forms of financial assistance.

It said the new household support fund will “support millions” via small grants for food, clothing and utilities, with money being disbursed by local authorities.

It comes with the government facing mounting pressure to address the cost of living for poorer families who are being squeezed by rising energy costs just as the Treasury withdraws a £20 uplift to the basic £118-a-week universal credit payment on 6 October, the final day of the Conservative party conference when the prime minister, Boris Johnson, is expected to speak. The Institute for Fiscal Studies thinktank has calculated that an extension to the £20 uplift for a year would have cost the exchequer £6bn.

Rishi Sunak, the chancellor, has portrayed the extra £20 a week as a temporary measure reflecting the extra difficulties households faced during the pandemic, and he is thought to be keen to avoid permanently locking in the £6bn-a-year cost of the uplift. However, Sunak has faced pressure from the opposition parties and from Conservative backbenchers to retain the extra £20 a week.

Thursday is also the last day for which employers can claim financial support for the wages of furloughed workers.

The new fund will run for an unspecified period over winter, with £421m available to English councils and £79m for Scotland, Wales and Northern Ireland.

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The government on Wednesday night insisted that shortages of fuel at filling stations are easing after army drivers were mobilised to deliver petrol, but the crisis in energy supply to households showed no sign of abating as three more suppliers went bust. Citizens Advice on Thursday warned that households will face “desperate choices” this winter as energy bills rise by £30 a month for customers of collapsed suppliers.

Sunak said: “Everyone should be able to afford the essentials, and we are committed to ensuring that is the case.

“Our new household support fund will provide a lifeline for those at risk of struggling to keep up with their bills over the winter, adding to the support the government is already providing to help people with the cost of living.”



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