The Resolution Foundation, a UK-based thinktank, has called on the government to implement a targeted relief scheme to lower energy bills for low-income households. The proposed plan aims to provide savings of up to £175 per year for the most vulnerable consumers, addressing concerns that rising wholesale gas prices—exacerbated by ongoing conflicts in the Middle East—will increase financial pressure on families throughout the winter months.

This proposal comes in the wake of Prime Minister Andy Burnham’s recent policy shift, which temporarily removed VAT from electricity bills. That measure is estimated to save the average household approximately £45 annually. However, the Resolution Foundation argues that this existing relief is insufficient given the current trajectory of energy costs. The thinktank estimates the total cost of their proposed intervention to be £2 billion.

While the government has acknowledged the need to address energy affordability, the debate centers on the scale and scope of state intervention. Proponents of the Resolution Foundation’s plan argue that direct, targeted support is necessary to prevent a cost-of-living crisis during the colder months. Conversely, fiscal conservatives often raise concerns regarding the long-term impact of such spending on the national budget and whether broad-based or targeted relief is more effective in stabilizing the energy market.