Economists at Pantheon Macroeconomics believe that a UK recession “looks unlikely” following the announcement of a new package of energy bills support.
Under the government's 'energy price guarantee' (EPG), the price that customers can be charged for each unit of gas or electricity will be capped, meaning that average annual household bills will be limited to around £2,500 for the next two years. Projections from consultancy Cornwall Insight showed that bills were forecast to top £5,000 next year in the absence of further support or any radical fall in gas prices.
Businesses and non-domestic energy users such as schools will also be offered equivalent support for six months, although companies still await precise details. After this time, ongoing support will be focused on “vulnerable industries”, a category set to be determined as part of a review in three months’ time.