Why aren’t our political leaders doing more to help citizens with the cost of energy crisis?

A solution will never come from the energy regulator Ofgem – lest we forget its energy price cap was £1000 in the summer of 2020 for typical household usage; by April this year that had almost doubled to £1971.

It will hit £3359 this October – that’s a 70% rise from April.

You may recall the former chancellor, right, Rishi Sunak’s big idea was a £200 advance payment to every domestic bill payer in the UK that had to be repaid over a few years.

In May he did a U-turn and announced a £5bn temporary windfall tax on oil and gas companies and a £15bn package of assistance.

Mr Sunak’s new package included the £200 loan becoming a £400 grant for households in October this year, a £650 cost-of-living payment for the poorest, a one-off £300 payment to eight million pensioner households and £150 to six million disabled people.

Fifteen billion pounds is a lot of public money but it doesn’t look that impressive when compared to government interventions in Germany, France and Italy.

To shield households and businesses from the energy crisis Germany has allocated £43.2bn; France has allocated £35bn and Italy £37bn.

Research by the European economic think tank Bruegel shows that most European countries have reduced VAT on energy bills.

We could do more to lessen this levy in the UK, and some political parties are understood to be considering this.

Italy has acted to reduce standing and supply charges for customers. France has intervened to limit the increase in regulated tariffs to 4% for this year.

France is in a fortuitous position as it owns the energy company EDF and has mandated this public company to keep fuel prices down. Cyprus, Greece and Portugal have done likewise.

The great irony is the UK used to own its energy companies and the National Grid – the infrastructure for gas and electricity coming in your home.

Sadly, these family jewels were all privatised and sold-off in the 1980s and 1990s.

We are where we are in the UK. We have an invisible prime minister and new chancellor missing in action with possibly no replacements until September 5. Yesterday, a study by York University’s social policy research unit exposed the severity of the crisis that is upon us.

The university predicts 11.6m people (4.2m households in the UK) will be spending more than a quarter of their net income on energy bills by January next year.

A staggering three million households are set to spend almost a third of their net income on energy bills creating unprecedented fuel poverty in recent times.

New research by Loughborough University confirms that the current UK package of support is insufficient for low-income households. Unless we do something radical, choices for many this winter will be between heating and eating.

The reality is that compared to just two years ago average energy bills will have increased by almost £200 per month. Many people were struggling with their level of fuel bills in 2020.

Add into the mix the Bank of England’s base interest rate rise of 0.5% last week. The base rate has now increased by 1% since April this year.

For those on standard variable rate or tracker mortgages, bills will go up immediately. There are 1.3m fixed rate mortgage deals coming to an end this year.

A household with a £150,000 repayment mortgage at the current average two-year rate will face monthly payments £159 higher than those paid by someone who took out an equivalent deal in January.

Many consumers are looking at cancelling their direct debits and paying bills manually as they feel energy suppliers are taking payments above actual usage. The downside with doing this is you may be charged a higher tariff – possibly up to 6% more.

Consumers shouldn’t have to make this choice and be penalised.

In Italy, greater flexibility has made for customers to pay their bills by instalments – there is no reason we couldn’t introduce better payment flexibility in the UK.

Helping customers with flexible payments is one thing but given the scale of the energy crisis we need big solutions, and we need them by October. The case for removing VAT on energy is overwhelming.

VAT is at 5% so the impact of this measure is important but will be modest.

The UK needs another windfall tax on oil and gas companies, and it needs to dramatically ramp up its support package to shield all households – particularly the most vulnerable – from the cost of energy crisis.

That won’t be achieved by general tax cuts that benefit the wealthy the most.