Member of Parliament for Amber Valley


Help with the cost of living

Dear Constituent,

Welcome to this special edition of my email newsletter to provide a summary of the Chancellor’s announcement yesterday to provide support for families in light of the rising cost of living. With the recent news that Ofgem will increase the energy price cap again in October, it was clear that more needs to be done to help households and those struggling so I welcome the support announced yesterday as a positive step. Below you will find an outline of this additional support.

The cost of living crisis

The cost of living crisis that we are experiencing at present is essentially the result of a series of global events which have driven inflation to significantly high levels across the world. These global pressures include the fast reopening of the global economy after the pandemic – with the demand for gas and oil rising so sharply that supplies were not able to keep up, causing skyrocketing gas and oil prices. Russia’s invasion of Ukraine further complicated global gas and oil supplies and a fresh wave of lockdowns in China has damaged global supply chains.

The underlying problems that have caused this inflation, and therefore the rise in the cost of living, are so global it is impossible for any government to solve. However, we can help those struggling and build our own economy. The Government is doing this today through a £15 billion package which will support the most vulnerable one-third of households with £1,200 each.

The Government’s additional support can be summed up in the following:

  • Raising extra revenues through a new Energy Profits Levy, but without deterring investment from energy companies.
  • Providing £9 billion targeted support to the most vulnerable households, including pensioners.
  • Supporting hard-working families with £6 billion to help with energy bills.

The below sections will expand on these elements and give an overview of the support you are going to receive.

Supporting hard-working families with £6 billion to help with energy bills.

  • The October £200 energy bills rebate will be doubled to £400. It will also be turned into a grant, meaning it will not have to be paid back. That’s £400 directly back into the pockets of UK households. This will continue to be delivered by energy suppliers from October, with payments spread over six months.

Providing £9 billion targeted support to the most vulnerable households, including pensioners.

  • £650 cost of living payment for every household on means-tested benefits. This means over 8 million of the most vulnerable households (around one-third of all in the UK) will be directly sent a one-off cash payment of £650, paid out from DWP in two separate instalments, with the first due from July and the second in the Autumn. All those who live in the UK and are in receipt of Universal Credit, Jobseekers Allowance, Employment and Support Allowance, Income Support, Working Tax Credit, Child Tax Credit and Pension Credit are eligible.
  • Winter fuel payments will be increased to £300. A pensioner cost of living payment for every pensioner household in receipt of Winter Fuel Payment. Around 8 million pensioner households already receive Winter Fuel Payments. The Government will send all existing recipients an additional one-off £300 cash payment, due to be paid out automatically in November/December.
  • £150 disability cost of living payment for those in receipt of disability benefits. There will be an additional one-off cash payment worth £150, paid out from DWP in September
  • An extra £500m for councils to help those in real need who are not covered by any of the above. The Government is providing an additional £500 million for the existing Household Fund from October, to ensure local councils can support those not covered by the above set of payments. Local councils will continue to have discretion over exactly how the funding is used.

The new Energy Profits Levy

  • The Levy will be in place from today, and will raise around £5 billion over the next twelve months. The new Levy will be charged on profits of oil and gas companies at a rate of 25 per cent, on top of the existing 40 per cent headline rate of corporation tax. It will be temporary, and as the oil and gas price returns to more historically normal levels, the Levy will be automatically phased out.
  • We still need to incentivise energy companies to invest in the UK. This is to ensure we are more protected from crisis like these in the future. Therefore, a new Investment Allowance will double the overall investment relief for oil and gas companies, so companies will have a significant incentive to reinvest their profits. Modelled on the ‘super-deduction’, for every £1 an oil or gas company invests, they will pay 91 per cent less tax.
  • This is very different from the levy proposed by Labour: Unlike Labour’s windfall tax, this Levy incentivises investment and raises more revenue. The Government’s Levy raises around £5 billion over the next twelve months. 

The support announced yesterday is in addition to previous measures, including

  • The non-repayable £150 Council Tax rebate for homes in Council Tax bands A-D; 
  • The 5p cut on fuel duty for the next 12 months, saving car drivers £100; 
  • £200 million per year to continue the holiday activities and food programme for disadvantaged children during school holidays; 
  • Significantly increasing the National Living Wage by 6.6% on the 1st April 2022 to £9.50 per hour for those over the age of 23; 
  • Increasing the National Insurance personal threshold from £9500 to £12,570 from July. 

If you have questions about any of the above, or you have an issue you think I might be able to assist with, please don’t hesitate to get in touch. 

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Get in Touch!

As always, you can contact me by hitting the ‘reply’ button on this email, or you can ring my office on 01773 744341.

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Yours sincerely,


Promoted by Nigel Mills MP, of Unicorn House, Wellington Street, Ripley, Derbyshire, DE5 3EH.