The Rt. Hon. Rishi Sunak MP
Chancellor of the Exchequer
HM Treasury
1 Horse Guards Road
Westminster
London
SW1A 2HQ

9 February 2022

Our Ref: 20220209/JC2

Dear Rishi,

RE: Energy bills loan

Since your statement to the House on Thursday the 3rd February regarding the energy bills loan, I have been contacted by many constituents who are extremely concerned about the ‘buy now, pay later’ proposal.

We are in the midst of a cost of living crisis. Families are seeing the prices of everyday essentials continue to rise and the Bank of England now forecast inflation to rise to 7.25% this year. My constituents are now bracing for their energy bills to rise by almost £700 when the cap rises in April.

I was therefore deeply disappointed by the lacklustre support the Government is preparing to offer. When so many families are already on the brink of poverty, the measures announced last week will do nothing to alleviate their concerns. On top of this, many constituents have contacted me to ask if they will be able to opt-out of the £200 loan in October. Many people may wish to not receive the loan for a whole range of reasons – some may simply not want it, some may worry about getting into even more debt, and somemay not want the loan due to their faith.

For so many people, getting into large levels of debt has caused immense psychological distress and they therefore seek to avoid taking out any loans. It is therefore unacceptable that the loan will be mandatory, without any option of opting-out. Further to this, I am deeply concerned by the fact that the £40 a year levy to repay the loan will apply to household energy bills even if they did not benefit from the £200 payment in October (for example, if they do not currently pay energy bills directly but will take out a policy in the next five years). At a time when so many families are worried about their energy bills, forcing them into more debt and increasing their bills next year will only increase their financial anxieties.

I urge you to step up to the challenge and support working families by backing Labour’s plan for a cut in VAT on household energy bills and an extension of the Warm Home Discount.

Yours sincerely,
Gill Furniss MP
Member of Parliament for Sheffield Brightside and Hillsborough
Shadow Minister for Roads