‘Huge judgement call’ Rishi Sunak told to borrow billions or let households suffer

He said: “Rishi Sunak has to make a huge judgement call.

“Will he do more to protect households from the effects of energy prices which have risen even further in the last two weeks?

“If he doesn’t then many on moderate incomes will face the biggest hit to their living standards since at least the financial crisis.

“If he does, then there will be another big hit to the public finances.

“While he had little choice over big state action through the pandemic, his response to this crisis will tell us more about how he sees the limits of Government in protecting citizens from buffeting by external forces.”

The IFS argue that without more public spending as a result of the worsening cost of living crisis public sector workers will face a real term pay cut.

At the same time energy bill payers will be hundreds of pounds worse off.

A surge in oil and gas prices caused by supply issues and the Russian invasion of Ukraine will add to increasing energy bills and fuel costs will help increase inflation further. 

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One option Mr Sunak may consider is more targeted support assisting those struggling most with the impact of the rising oil and gas prices along with the cost-of-living crisis.

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