Britons brace for price hikes despite Starmer pledge to ease spiralling cost of living

Despite a raft of measures announced by Sir Keir Starmer to reduce the spiraling cost of living, households and businesses are bracing for price rises and rising bills.

The Prime Minister promised that in an “uncertain and volatile world” his government will “protect British people at home and abroad”.

But he warned that the Strait of Hormuz, which is vital for much of the world’s oil supply and was closed as part of the Iran war, should be reopened to ease Britain’s rising cost of living crisis.

Sir Keir Starmer chaired a meeting of the Cobra crisis committee on Tuesday to assess the impact of the conflict on households and the wider economy, but has so far resisted calls to offer widespread help on the bills beyond targeted support for those struggling with the rising cost of heating oil.

It comes as it marks a fall in home energy bills by an average of £117 a year, a rise in the national minimum wage to £10.85 and the national living wage to £12.71, the start of the £1bn crisis and the resilience fund and prescription price freeze to help vulnerable households with rising heating oil prices.

But the prime minister and chancellor are under pressure to go further, including following European countries and taking action to protect consumers from skyrocketing fuel prices, after campaigners accused ministers of treating drivers like “the Treasury’s cash cows”.

Sir Keir said: “I know people are concerned about the conflict in Iran and what it means for them and their families.

“I want to reassure them that they have a government on their side, working with its allies to reduce tensions and reduce the cost of living.

“Today, millions of people up and down the country will see their energy bills drop by £117, pay rises for the lowest paid, and more support for people who need it most, thanks to government decisions.

“But we need to go further to reduce costs, and that means pushing for de-escalation in the Middle East and the reopening of the Strait of Hormuz. That’s the best way to lower the cost of living for families, and that’s my focus.”

However, council tax, water bills as well as broadband and mobile phone costs are expected to increase.

According to the Department of Housing, Communities and Local Government, the average Band D council tax from April 1 will rise by £111, or 4.9 per cent, to £2,392.

Household water bills in England and Wales will rise by an average of 5.4 per cent, or £33 a year for the average household.

BT, EE, Plusnet and Virgin Media are increasing broadband prices by £4 a month, Sky by £3 and Vodafone by £3.50, adding around £50 a year to bills.

Additionally, one in four broadband customers are out of contract and paying up to £9 a month more than those on contract.

However, the price most households pay for energy will fall by 7 per cent, or £117 a year, under regulator Ofgem’s price cap to £1,641, driven by the government’s promise to cut bills by an average of £150 by removing green subsidies.

Energy bills are also expected to rise by as much as £300 a year from July as a result of the Iran war.

Meanwhile, businesses not protected by price caps are bracing for painful increases in gas and electricity tariffs as disruption to major shipping routes causes prices to soar.

“The tax burden on hospitality (the highest tax in the economy) is stifling the sector,” UKHospitality, the British Beer and Pub Association and the British Hospitality and Hospitality Institute Ulster said in a statement.

“The alarming situation facing the business energy market has the potential to accelerate all of these impacts.”

The government “must be ready to support vulnerable businesses if they are dragged into another crisis,” they added.