BRIEFING:  The poverty impact of Budget 2023

20.500.12592/tcd76t

BRIEFING: The poverty impact of Budget 2023

16 Mar 2023

Additionally, the extension of the Energy Price Guarantee at the level of £2,500 a year for the average household (see the next section) will further reduce financial pressure on low-income families, bearing down on the number in poverty. [...] 3 EXTENDING THE ENERGY PRICE GUARANTEE Context Before the announcement in Budget 2023, the government Energy Price Guarantee was scheduled to be increased from the previous level – equivalent to £2,500 per annum for the average household – to the equivalent of £3,000 per annum for the average household in April 2023. [...] From Q3 2023, the Ofgem tariff cap is projected to fall below the level of the Energy Price Guarantee, even at the lower level of £2,500 per annum.iii Accordingly, the government’s policy will only affect household finances in the first quarter of the 2023-24 financial year, preventing a sharp but temporary increase in household bills. [...] As well as a more accurate reflection of a family’s ability to make ends meet, the SMC’s poverty measure tracks: • The degree to which a family is below the poverty line • The length of time that a family is below the poverty line • The experience of living in poverty. [...] SMC methodology More details of the SMC’s approach to poverty measurement can be found here: 9 ANNEX 2: MODELLING OF ENERGY COSTS The briefing models the likely impact of increases in the energy price cap on poverty in the United Kingdom.

Authors

Kay Webb

Pages
14
Published in
United Kingdom

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