Government criticised over cut to support fund for vulnerable households

The Household Support Fund was dropped last month as part of the Chancellor’s Autumn Statement. The fund was introduced in September 2021 to “help the most vulnerable households across England with essential food and energy costs”.

However, the Government has now confirmed the scheme will come to an end in March.

The leader of Northumberland Labour, Cllr Scott Dickinson, has penned a letter to Chancellor Jeremy Hunt and claimed the cut will cost Northumberland households almost £5m.

Cllr Dickinson, Druridge Bay ward member, said: “Incredibly, as the cost of living crisis deepens, driven in no small part by the largest tax burden in 70 years, the Chancellor has abolished the fund – cutting £4,960,660 in support for households in Northumberland.

“This comes just a year after the Conservatives crashed the British economy.”

In his letter to Mr Hunt, Cllr Dickinson said the cost of living crisis was “hurting each and every one of us” and accused him of ‘secretly’ taking the support away.

The letter added: “The household support fund provides much needed assistance to those who need a little help to make ends meet through the cost of living crisis your party helped create.

“Taking that support away is an attack on hard working families in Northumberland who are doing everything they can to get their families through the worst parliament for living standards in history. The Conservatives have utterly wrecked the British economy – and you are asking families in Northumberland to pay the price.”

Responding, a spokeswoman for the Government said: “We have invested over £2bn into the Household Support Fund over the last two years – with almost £800m already paid to families with children to help with the cost of living. The fund is available up until March 2024 and comes on top of a record cost of living support package worth around an £3,700 per household.

“This includes increasing benefits by 6.7% from April, increasing the state pension and increasing the local housing allowance to help private renters on Housing Benefit or Universal Credit save nearly £800 on housing costs. We have also halved inflation to help everyone’s money go further and cut taxes for hardworking people at the Autumn Statement – saving the average earner £450 a year.”

The Conservatives did cut National Insurance in the Autumn Statement, saving the average worker £450 a year. However, the Government was also criticised for creating what is known as “fiscal drag” – by freezing tax thresholds for the last four years, more people are pulled into higher tax brackets.

According to figures from HMRC, in 2012-13, 84% of taxpayers were paying the basic rate of tax, while 12.2% paid the higher rate. As of 2023/24, 80.2% are paying the basic rate while 15.%% are paying the higher rate.

And while the Government has taken credit for halving inflation, the director of a leading influential economics think tank has argued that it was down to the Bank of England rather than the Government.

Paul Johnson, director of the Institute for Fiscal Studies, said: “The job of cutting inflation is for the Bank of England not the Government.”