Ofgem has announced that the energy price cap will increase by £693 from April.
The Bank of England has also announced an interest rate hike to 0.5% from 0.25%.
In response to the current economic situation, Rushanara Ali MP said:
“The UK is facing a cost of living crisis like no other. Ofgem’s decision means the energy price cap will increase by £693 for 22 million customers. On top of this, the rise in interest rates to 0.5% will put further pressure on families as mortgages and other debts go up. Meanwhile, the £350 support package for families announced by the Chancellor, does not go nearly far enough to help struggling families. The Institute for Fiscal Studies has said that average earners, even after accounting for the government support package, will be £400 worse off in the next financial year compared to this one. And the Bank of England has warned that families are about to suffer the biggest fall in living standards since comparable records began thirty years ago.
In Bethnal Green and Bow, where 60% of children are living in poverty, this crisis will be felt particularly acutely. Local families will be hit very hard as prices soar, and many vulnerable people will suffer. Conservative economic mismanagement has meant that yet again working people are paying the price. Labour has a plan that will help tackle this crisis, for instance by removing VAT for domestic energy bills for one year and imposing a windfall tax on North Sea oil and gas. We urgently need this Government to think again and start to properly support families through what is an extremely challenging time.”