The richest households will receive twice as much support as the poorest, warns the think tank

The richest households will receive twice as much support for living costs as the poorest, the think tank has warned.

Wealthier homes will receive £4,700 in gifts and tax cuts next year, compared to just £2,200 for the poorest, according to the Resolution Foundation.

New Prime Minister Liz Truss has frozen the typical annual energy bill at £2,500 over the next two years, ensuring the average household will pay no more than £2,100 if the £400 rebate promised by former chancellor Rishi Sunak is taken into account.

Ms Truss’ price guarantee will save the typical household around £1,100 over the next six months, but the total amount saved is proportional to income, the think tank’s report found.

Higher income households tend to use more energy, meaning the richest could gain £1,300 this winter alone, compared to £1,100 for the poorest. The average home is predicted to receive £2,200 from the overall state support package.

Torsten Bell, from the Resolution Foundation, said the support package was “enormous” and would prevent a “catastrophe” in living standards – but families should still expect a tough winter.

Before Ms Truss’s intervention, the average energy bill was on track to rise to £3,549 from October, before jumping to an expected £4,586 in January.

Mr Bell said: “The Energy Price Guarantee was absolutely the right thing to do in terms of providing support where it was needed. But barring any attempt to finance it with further taxes on windfall profits, today’s welcome support could have the unfortunate consequence of higher mortgage payments and higher taxes tomorrow.”