Spring statement: What should you expect?
- Credit: PA Wire/PA Images
Chancellor Rishi Sunak is set to announce his spring statement and outline his plan to deal with the cost of living crisis.
Mr Sunak is expected to promise to "stand by" British families amid soaring living costs and outline further plans to support households facing financial hardship on Wednesday (March 23).
Here is what to expect from Mr Sunak's statement at 12.30pm.
What is the spring statement?
The chancellor will present the latest findings from the Office for Budget Responsibility (OBR) on the state of the UK economy and public finances.
The forecasts are likely to show the impact on fuel prices and energy bills with Mr Sunak facing calls to take action.
What could the Chancellor do?
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It has been suggested that Mr Sunak will cut fuel duty and could announce a temporary cut to the duty of up to 5p per litre in his statement.
Figures from data firm Experian Catalist show the average price of a litre of fuel at UK forecourts on Sunday (March 20) was 167p for petrol and 179p for diesel, amounting to an increase of 18p for petrol and 26p for diesel over the past month.
Labour has calculated the average family is facing an annual rise of £386 on the cost of petrol and is calling for a cut to be funded by a windfall tax on energy firms who have enjoyed the sky-high gas and oil prices.
The Chancellor could hold off the planned national insurance rise that was previously announced - but that would mean a significant U-turn from the government.
Both Mr Sunak and prime minister Boris Johnson have both previously maintained that the hike would not be delayed as the extra money would be used to fund the care sector.
Having cut VAT for hospitality firms to 5pc during the Covid pandemic, the government had been due to increase tax for the hospitality sector from 12.5pc to 20pc from April 1.
But pub bosses have warned that food and drink prices could increase if the planned rise goes ahead.
A move by Mr Sunak to stop the proposed increase would help people spending money on eating out, tickets and holiday accommodation.
Benefits including Jobseekers' Allowance, Housing Benefit and State Benefit are set to rise by 3.1pc in April but is well behind the expected inflation rate of 8pc.
Think tank The Resolution Foundation argued that adding five percentage points to take the benefits rise to 8.1pc would be the most effective way to support families hardest hit.
The Chancellor has already announced a £200 loan to gas and electricity payments from October but not until the price cap rises by 54pc.
Households will have to pay back the £200 energy bill rebate over four instalments from next year when energy prices should fall.