Chancellor weighs targeted aid for benefit claimants as middle-class families face higher energy costs

Facing a potential quarter-point rise in the energy-price cap, the chancellor is reviewing measures that would primarily aid households receiving means-tested benefits, possibly expanding the warm-home discount that offers £150 off bills. The temporary 5% VAT cut on electricity, set to expire in March, has already been offset by steep price increases, leaving middle-class families without additional relief. Treasury officials warn that extending the VAT relief would deplete limited resources as the budget deadline approaches on October 28.

Rumours suggest Healey may consider a capital-gains wealth tax and a tougher mansion tax to raise revenue, despite an already high tax burden. Labour ministers, including Rachel Reeves, have defended recent tax rises as necessary to meet fiscal rules, while opposition figures accuse the government of manipulating figures rather than cutting spending.