On September 30, Rishi Sunak announced the £500m Household Support Fund. Money will be made available to local councils throughout England and distributed to members of the community. The fund aims to help the most vulnerable with basic household costs such as food, clothing, and utilities.


The Price Hike

Over the next few months, many families and households will be struggling due to a series of unexpected circumstances. Firstly, there has been a 12 per cent rise in energy prices as a result of the gas supply crisis, causing a higher energy cap to be implemented.

Ordinarily, the energy cap places a fixed rate on the price of energy and how much suppliers can charge. Owing to the price hike, households with typical levels of energy use and on standard tariffs can expect a bill increase of £139, while those with prepayment meters will expect a bill increase of £153. Households with larger than average energy use can expect an even higher annual bill.

Secondly, everyday costs are increasing. Helen Dickinson, Chief Executive of the British Retail Consortium, stated:

‘September saw overall prices fall, but the decline is slowing. There are now clear signs the months-long cost pressures from rising transport costs, labour shortages, Brexit red tape, and commodity costs are starting to filter through to consumer prices’.

In conjunction with these burgeoning costs, monetary support from the government is drying up. The temporary £20 weekly increase to Universal Credit administered by Sunak in April 2020 has been cut. As has the furlough scheme, which ended on September 30.

Although the government has been criticized by various charities for these choices, they haven’t reversed their decisions. Instead, the Household Support Fund has been introduced as the solution to people’s increasing economic hardships.

A Rosy Picture

In the government’s press release, the language used presents a rosier picture of the monetary support offered.

The press release states that households will ‘continue to benefit from the energy price cap … and increases in the National Living Wage’.

However, as we know, the energy price cap has already increased this year. As a result, many households across the country will likely be scrambling to find the extra cash. As for the National Living Wage, though it is true that minimum pay given to those over 23 has increased to £8.91, this is still lower than the real living wage — set at £9.50 by the Living Wage Foundation.

The Conservatives’ Dilemma

In the 2019 General Election, the Conservative Party won by a landslide. Seats were won in predominantly working-class constituencies, such as Wrexham, that previously voted Labour.

In a survey conducted by YouGov on the 2019 General Election, results showed that the Conservatives won 48 per cent of voters in the C2DE social grade. This pool is largely made up of unskilled manual workers, pensioners, casual workers, and the unemployed. Meanwhile, the polling demonstrated that Labour only won 33 per cent of the C2DE vote.

Since then, this trend has continued in this year’s local elections in May where the Conservative Party made gains in Labour strongholds. Overall, they gained 13 seats. One constituency of particular interest was Hartlepool. Described as a working-class town, it turned away from Labour and became blue in a historic by-election.

However, maintaining this change in voting patterns relies heavily on placating the new group of voters.  Implementing policies that appear to benefit the working class is a must for a government that hopes to preserve its enlarged voter base.

This government played no small part in helping to create the conditions for the current economic turn. Brexit contributed to the supply chain issues. The cut to Universal Credit will cripple those who said the additional £20 was a ‘lifeline’. But instead of admitting that mistakes have been made and changing course, the government prefers to see itself as the hero that saves the day with its generous Support Fund.

Realistically, this fund isn’t going to solve any of the fundamental issues affecting the poorest households. It is no more than a placebo that merely offers the illusion of support.

Instead of the Household Fund, money should have been designated towards repairing the social security system. Deputy Director of the Joseph Rowntree Foundation, Helen Barnard, commented that the government’s introduction of this fund signifies how aware they are of the ‘damage the cut to Universal Credit will cause’.

The announcement of the fund is a preemptive attempt to avoid later criticism rather than a genuine helping hand to those in need.

If the Conservative Party really want to keep their new voters, admitting fault and fixing the problems they’ve helped create would be a good start.

 

Image Credit: By 10 Downing Street