Rishi Sunak announces ‘£400 off energy bills for every home’ in Partygate distraction

Chancellor Rishi Sunak will announce the energy bill subsidy as part of a package of measures to deal with the cost of living crisis and divert attention from the Partygate row

All UK households will receive an energy rebate of up to £400 and not have to pay it back, it has been reported.

Rishi Sunak will announce the grant plan – to be distributed by energy companies – on Thursday as part of a package to support the rising cost of living, sources said.

The Chancellor will scrap a much-criticized “discount and clawback scheme” that would have given people a £200 rebate on energy bills from October.

The suppliers would have repaid the funds by charging more over the next five years – leading to criticism that it was in fact a loan.

Government sources claim the move to Partygate, announced on Wednesday night, could cost more than £10billion.

Boris Johnson and Number 10 are keen to draw a line under the row where the Prime Minister has been pictured at Covid lockdown parties.

It is widely expected that an unexpected tax on oil and gas giants, which have benefited from high global prices, will help fund policies targeting the most vulnerable.

Other measures in the mix-and-match package could include further cuts in council tax bills and increases in benefits.

However, ministers have ruled out restoring the £20 increase in Universal Credit amid fears a boost could become permanent.

A reduction in VAT on energy and fuel is not included in the plan, with all tax cuts being postponed until the autumn budget.

A spokesman for Her Majesty’s Treasury declined to comment on the reports.