CAP’s Head of Policy and Public Affairs, Max Stafford, responds to the Autumn Budget.
A £100 payment to most Council Tax payers. The removal of standing charges on gas bills. A small increase in the National Living Wage. All of these are welcome measures but they’re not enough to remove anxiety about a predicted minimum 16% increase in energy bills in January.
Following the delivery of the Chancellor’s Autumn Budget, CAP is concerned about what this means for our vulnerable clients. Whilst the intention to deliver breathing space is welcome, the budget won’t bring sufficient relief for those worried about the upcoming rise in energy costs. The budget’s focus on cost-of-living and employment-related themes was to be expected but there were some obvious omissions.
29%
of people now live with less than £200 in savings.
CAP acknowledges there could be benefit for some people with the introduction of a New Starter ISA for first-time investors, but this is reliant on people having enough income that they can save and an understanding of the savings options available. CAP would also like to have seen further action taken on financial education off the back of the Financial Inclusion Strategy.
With the energy price rise likely to be the equivalent of at least £276, according to Cornwall Insight, this is a real cause for concern in the most vulnerable households.
As Stewart McCulloch, CAP Group CEO, stated in his instant response:
There were missed opportunities for targeted support for those struggling the most. An introduction of a national social tariff, the restart of the energy debt relief scheme, and an increase in the Winter Fuel Payment could have provided much-needed relief.
What is even more concerning is that the Chancellor did not once mention the Benefit Cap, Universal Credit or long-term options on the energy tariffs paid by the most vulnerable.
Our main policy asks for this Budget were:
- Remove the Benefit Cap, or at least uprate it to deliver a liveable income for the most vulnerable;
- End the five-week wait for Universal Credit; and
- Introduce a National Social Tariff for utilities.
We acknowledge that John Healey pledged a 2027 White Paper to act on the recommendations of the Timms and Milburn Reviews. But the absence of any mention of Universal Credit or the wider welfare picture was unexpected. We welcome the Chancellor’s more compassionate language around discussing those receiving benefits, avoiding negative tropes or stereotypes about the most vulnerable. However, if the government wish to make good on their rhetoric of approaching welfare as a means to help people into work, then we needed to hear more about the continued levels of support that will be provided to do just that. Instead, we are waiting on the Timms and Milburn reviews whilst also having to see if the Spending Review 2027 provides the necessary answers.
We now wait to see what the measures in the Spring Statement and Spending Review might bring. Much of that will depend on whether the new predictions on growth, inflation and borrowing turn out as expected. If they do, fiscal headroom may allow for uprating of Universal Credit or the other such measures that deliver real liveable incomes for those experiencing deficits in their household budgets.
That’s a big ‘if’. But even if it does turn out as Healey is hoping, that will still mean that millions will have gone through the hardest part of the year (winter) without enough of the support that they needed. CAP, as ever, remains their advocate.
