The Chancellor will come under intense pressure to ease cost of living pressures on households up and down the UK in his maiden Budget on 28 October.
With food, fuel and energy prices rising – and inflation showing no sign of slowing down – relief is urgently needed.
Labour has already unveiled a number of everyday fixes but households struggling will no doubt be looking for further support.
So, what help could be on the way and how much could it save you? Here, we look at the options.
Energy bills help
The Government has already taken steps to ease energy costs, with VAT removed from household electricity bills from 1 October, saving households an average of £45 a year.
Around six million households are also eligible for the £150 Warm Home Discount this winter.
Further help could include increasing the Warm Home Discount or reforming standing charges, the fixed daily fees households pay for being connected to the energy network.
A typical dual-fuel household would save £27 a year if gas standing charges were abolished and the costs were instead shifted into the gas unit price, according to research by Nesta.
Adam Rolfe, policy and public affairs officer at Money Wellness, said: “The Government should go further and introduce a targeted social tariff, giving vulnerable households access to more affordable energy throughout the year.”
Fuel duty tax hike delay
The temporary 5p-per-litre fuel duty cut is due to end on 31 December, keeping the main fuel duty rate at 52.95p per litre.
Fuel duty is usually set at the Budget and has been frozen at 53p a litre since March 2022.
Healey is expected to continue this freeze to protect motorists from higher prices which Rolfe said would provide “welcome relief” for motorists.
On a 55-litre tank, the saving is around £2.75 compared with the full duty rate.
Consumer rights expert Scott Dixon said: “The Government has been raking in millions in VAT receipts from sky-high fuel prices, so a temporary VAT cut on petrol and diesel ought to be considered.
“Higher fuel costs don’t just hit motorists. Everything you buy comes to shops and homes in diesel-powered vans and trucks, so higher fuel costs are ultimately passed on to consumers – and prices rarely come down.”
Diesel has now crossed the £2-per-litre mark, which is a record high, and unleaded petrol is also rising due to a combination of global conflicts, supply chain constraints and refining shortages.
Minimum wage increase
The national living wage for workers aged 21 and over is currently £12.71 an hour, while those aged 18 to 20 receive at least £10.85.
Reports suggest the adult rate could rise by around 3.9 per cent to £13.20 from April 2027, with the younger workers’ rate rising to about £11.27.
A rise would boost earnings for low-paid workers, but could also increase costs for employers, particularly in hospitality, retail and social care.
Dixon said: “Hiking the minimum wage above inflation will help lower-paid workers, but this will soon be the median wage in many places. The hospitality sector will struggle to afford to employ staff in the face of soaring business costs”.
Rolfe warned the interaction with universal credit is important too as most claimants lose 55p of their award for every additional pound they earn, so the do not keep the full benefit of a pay rise.
Food tariffs
This morning, the Government announced the suspension of tariffs on more than 100 food items in an attempt to reduce costs for consumers. The savings will depend on whether importers and retailers pass on the reductions in full.
Labour said it was helping lower import costs on “family favourites” including baked beans, chocolate and gherkins.
It is estimated that these tariff cuts will save consumers up to £21 a year – around 40p a week.
The measure could also reduce costs for businesses importing affected goods. But tariff removal does not guarantee that shop prices will fall by the full amount, as other costs also influence what consumers pay.
Carer’s allowance changes
The Government announced a reform to the current “cliff edge” that happens with carer’s allowance.
Currently, carer’s allowance is a benefit paid to those who spend at least 35 hours a week caring for a person receiving a qualifying disability benefit. It is worth £86.45 a week and can be claimed by any carer aged 16 or older.
At present, claimants lose eligibility if they take a break from caring or exceed the earnings limit, which is currently £204 per week.
Most benefits have an earnings taper, which means that payments are gradually reduced as income rises. But carer’s allowance has a “cliff edge”, which sees claimants losing the whole £86.45 if they exceed the earnings limit by a single pound. Claimants also become ineligible if they study for 21 hours or more per week.
But the Government is changing the rules so unpaid carers no longer lose their entire allowance for earning a penny over the weekly limit and, instead, only £1 of support will taper away for every additional £1 earned.
Paternity pay
The Government has said it will extend parental pay to over 150,000 additional parents per year.
This includes self-employed dads and partners, who have historically lacked access to statutory paternity pay, and will give eligible parents two weeks of support currently worth up to £194 a week.
Scott Winter, co-founder of Agility EOR, a human resource consultancy, said: “Two weeks of pay won’t solve everything, but it’s a fair change and long overdue.
“Self-employed fathers have had nothing at all until now, which meant a lot of them went straight back to work after their baby was born because they couldn’t afford not to.”
Statutory paternity pay in the UK is £184.03 per week, or 90 per cent of your average weekly earnings – whichever is lower.
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