Liz Truss has now been elected Prime Minister of the United Kingdom by only 81,326 Conservative Party members. As she begins her premiership, Tower Hamlets Labour calls on her to get to grips with the financial crisis affecting struggling residents across the borough and work with the Labour Party to tackle the Cost of Living Crisis.
Tower Hamlets is a borough of contrasts, and although it has seen growing wealth in some areas, it contains some of the most deprived areas of London. Ofgem’s recent announcement that energy bills will go up by 80 per cent will have a devastating impact on low-income families across the borough and the Government has consistently failed to meet the scale of this emergency.
Liz Truss has declined to state what her plans will be to help vulnerable residents and struggling families as winter approaches. The only policies that she has firmly backed are tax cuts which will disproportionately benefit the wealthy.
The Labour Party has now revealed that its fully-costed plan to freeze energy bills this winter would save someone on the minimum wage more than £40 a week in Tower Hamlets.
Labour’s plan would prevent the energy price cap rising, meaning people would not pay a penny more this winter. It would be paid for from the record profits made by oil and gas giants.
The package, first announced by Labour two weeks ago, would also reduce energy demand and lower bills in the longer term by insulating 19 million homes across the country over the next decade through Labour’s Warm Homes Plan.
Leader of the Tower Hamlets Labour Group, Cllr Sirajul Islam said:
“Residents in Tower Hamlets need urgent help as high inflation, wage stagnation and skyrocketing energy bill prices bring low-income families to a breaking point. We have one of the largest social housing stock in the country and many of our estates need investment such as insulation as winter approaches. During this Cost of Living Crisis as Leader of Tower Hamlets Labour Group I am worried for my residents.
“The new Prime Minister needs to act fast to protect poorer communities from the worst effects of sky-rocketing energy bills, although Liz Truss seems to be more concerned with protecting the wealthy than helping those in need. We cannot have a situation where residents have to choose between heating and eating.
“Labour has a plan to tackle this crisis, and this shows the importance of a Labour administration in power.”
Labour’s plan to freeze the energy price cap would save an average earner on the minimum wage over £40 a week.
- According to ONS income data, Median household disposable income in the UK was £31,400 per year, or £604 per week in financial year ending 2021
- TheBank of England expects nominal household income to increase by a total of 15% between December 2020 and December 2022.
- So weekly household incomes could bearound £694 this winter.
- According to ONSexpenditure data, the median income household spent £23.25 on energy in the financial year ending 2021.
- According to Cornwall insight, the energy price cap is forecast to rise by a factor of 3.7 between winter of 2020-21 and 2022-23. This means we’d expect the medianhousehold expenditure on energy to be £87.56 each week, assuming a 3.7 fold increase on 2020-21 data.
- This is 12.6% of their expected income.
- Labour’s freeze would cut expected energy bills by half, so we can expect the typical household to save over £40 a week.