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Energy bills support extended for an extra three months as Hunt prepares to unveil back-to-work Budget
15 March 2023, 08:46 | Updated: 15 March 2023, 11:04
Energy bills support will be extended for an extra three months as part of Chancellor Jeremy Hunt's Spring Budget.
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The Energy Price Guarantee (EPG) will be kept at £2,500 for an additional three months from April to June, saving a typical household £160, Chancellor Jeremy Hunt confirmed ahead of his Budget speech.
The support scheme has limited a typical household energy bill to £2,500 since October, but was due to increase to £3,000 in April to reduce the burden on state finances.
However, the scheme will now continue at £2,500 until July, in a move which will cost the Treasury around £3 billion.
The Government has come under increasing pressure in recent weeks to cancel the rise, which was set to come into force from April 1.
As wholesale energy prices have dropped, it has become increasingly affordable for customers to continue being protected with the same deal.
Energy prices are now 50% lower than forecast in October and are projected to continue dropping.
We are extending energy bills support for further 3 months.— Jeremy Hunt (@Jeremy_Hunt) March 15, 2023
With energy bills set to fall from July, extending the Energy Price Guarantee will bridge the gap, easing the pressure on families.
Made possible in part by windfall taxes on energy profits 👇 pic.twitter.com/5J1ihyjzRl
Prime Minister Rishi Sunak said: “We know people are worried about their bills rising in April, so to give people some peace of mind, we’re keeping the Energy Price Guarantee at its current level until the summer when gas prices are expected to fall.
“Continuing to hold down energy bills is part of our plan to help hardworking families with the cost of living and halve inflation this year.”
Mr Hunt said: “High energy bills are one of the biggest worries for families, which is why we’re maintaining the Energy Price Guarantee at its current level.
"With energy bills set to fall from July onwards, this temporary change will bridge the gap and ease the pressure on families, while also helping to lower inflation too."
Mr Hunt's Spring Budget, which he will deliver on Wednesday afternoon, will also include an end to the pre-payment meter premium and help with childcare costs.
He is expected announce a £4 billion expansion of free childcare for one and two-year-olds in a bid to get parents back to work.
The Chancellor's plan is believed to include around 30 hours a week of childcare for parents in England with children in that age group.
There could also be an increase in funding for the current childcare programme for three-year-olds.
It comes after a report by the Centre for Progressive Policy found that more than half of the mothers struggle to find suitable childcare.
As part of his "Budget for growth", Mr Hunt will focus on getting Brits back to work.
At the centre of that plan will be a range of measures designed to encourage the over-50s, the long-term sick and disabled, and benefits claimants to return to the workplace, with the Chancellor specifically set to announce the axing of the system used to assess eligibility for sickness benefits, paying parents on universal credit childcare support upfront and increasing the amount they can claim by several hundred pounds.
Changes to pensions are also expected, with the Chancellor likely to allow workers to put more money into their pension pot before being taxed by lifting the lifetime pension allowance.
"Today, we deliver the next part of our plan: a Budget for growth," he is expected to say.
"Not just growth from emerging out of a downturn.
"But long term, sustainable, healthy growth that pays for our NHS and schools, finds good jobs for young people, provides a safety net for older people... all whilst making our country one of the most prosperous in the world."