The Trades Union Congress (TUC) has called on Prime Minister Andy Burnham to introduce a social tariff aimed at reducing energy costs for low and middle-income households. TUC General Secretary Paul Nowak suggested that the initiative could be financed by restoring the bank surcharge to its 2023 level of 8%, reversing a reduction to 3% implemented by the previous Conservative administration. The union estimates this measure could generate £9 billion over a four-year period.

Speaking ahead of the TUC's annual congress in Brighton, Nowak emphasized that the upcoming Budget serves as an opportunity for the government to demonstrate its commitment to the public. He argued that such policies would provide tangible benefits to families concerned about heating costs this winter. While the government has already moved to temporarily remove VAT on electricity bills starting in October, the TUC maintains that a social tariff would offer more targeted support.

The proposal has met resistance from the banking sector. UK Finance, which represents major lenders, warned that increasing the tax burden on banks could hinder economic growth and negatively impact the UK's international competitiveness. The organization noted that domestic banks already face higher tax obligations compared to their counterparts in markets like the United States.

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Beyond energy policy, the TUC is advocating for broader fiscal reforms, including a potential windfall tax on social media companies and the equalization of Capital Gains Tax with income tax rates. Nowak also addressed concerns regarding immigration policy, urging the government to reconsider proposed changes that would extend the path to permanent settlement for migrants, particularly in the social care sector, which currently faces significant staffing shortages.

Nowak stressed that the government must deliver on its promises to maintain public support and counter political challenges from the populist Right. He encouraged Chancellor John Healey to utilize available flexibility within fiscal rules to prioritize long-term investment in public services and the national economy.

Source: BBC News