Andy Burnham has announced an £850 million tax cut on electricity bills as his first significant policy measure to address the cost-of-living crisis. The move was unveiled after the prime minister told his new cabinet in its first meeting that the government will be a 'cost-of-living government' and must examine 'all possible ways' to assist families struggling with high costs.
Policy details and impact
The tax reduction aims to lower electricity costs for households across the country, providing immediate relief amid soaring energy prices. Burnham emphasized that this is just the beginning of a broader strategy to support vulnerable families. According to sources close to the prime minister, the policy is expected to benefit millions of households, with the average saving estimated at around £100 per year.
Government's cost-of-living focus
In his first cabinet meeting, Burnham stressed the urgency of tackling the cost-of-living challenge, stating, 'We will be a cost-of-living government, and we will look at all possible ways to help families.' The announcement comes as inflation remains high and energy bills continue to strain household budgets. John Healey, a senior Labour figure, voiced support for the measure, calling it 'a vital step to ease the burden on working people.'
Reactions and next steps
The tax cut has been welcomed by consumer groups and opposition MPs, though some have called for further action on energy market reform. Burnham indicated that additional measures would be announced in the coming weeks, focusing on long-term solutions to energy affordability. The policy marks a clear departure from previous government approaches, signaling a more interventionist stance on household finances.
