Aurelia Butler

For a guy on holiday with his family, Martin Lewis looked and sounded anything but relaxed.The Money Saving Expert founder (and closest thing Britain has to a patron saint of personal finance) usually adheres to a self-imposed media embargo for two weeks every summer, but broke it following shock predictions that average energy bills in the UK could exceed £5,000 next year.Staring down the barrel of the camera, Lewis warned this was a “national crisis on the scale of the pandemic”, urging Britain’s “zombie government” to wake up and increase state support now or risk leaving “millions destitute and in danger this winter”. Lewis cares. Why? Because he can foresee exactly how bad this could get.A lightning rod for the tens of millions of consumers who subscribe to his weekly money saving email and follow him on social media, Lewis has a deep insight into the nation’s financial state of being. Politicians should ignore this at their peril. When energy regulator Ofgem announces the October price cap on August 26, it will be open season for energy companies to demand customers pay even higher direct debits. For many, monthly energy bills stand to be higher than their mortgage or rent.Ofgem says its recent upward adjustments to the price cap will prevent more energy companies going bust. But what about people going bankrupt? Lewis grimly predicts civil unrest.There’s been a surge of support for the Don’t Pay campaign. Supporters intend to cancel energy payments in protest (this will wreck their credit scores, but campaigners see no viable alternative).I’m a regular pundit on LBC Radio with Eddie Mair. Callers we speak to cannot understand the Westminster bubble’s continued ignorance of the financial ruin people and small businesses now face.At first, it was people with delivery jobs priced out of work by the increases in petrol and diesel. Others spoke of giving up jobs they were passionate about because the money was slightly better stacking supermarket shelves. But in recent weeks, the cost of gas and electricity has been the primary cause of anguish.We have heard from a mother of three who can only afford to eat her children’s leftovers. The dad of a newborn who runs his own business and is staring at bills he knows he has no means of paying. A Dundee shop owner who is not sleeping because his energy bills are about to quadruple to £53,000.The one that tipped me over the edge was a man who described how he was working two jobs — one day shift and one night shift, six days a week (and sleeping on Saturdays) yet this was still not enough to provide for his family.“The sense of bleakness stays with you,” says Mair. “The listeners who are suffering do not convey anger. I sense weariness; embarrassment at being unable to cope; despair.”For now, the only hope people can cling on to is that something will be done, eventually, but there is scant evidence of government planning to head off the “financial cataclysm” that Lewis and others predict. By contrast, fuel poverty charities are already in disaster planning mode. Christians Against Poverty handed out nearly triple the amount of emergency energy top-up vouchers in July as it did last year, and the Fuel Bank Foundation is also experiencing record demand.They know the double whammy of winter price cap rises will tip more households into “deficit budgets” — where their income is unable to cover basic outgoings of rent, fuel and food — and the impact is being felt by people higher and higher up the income scale.Energy debts are rising and providers simply don’t have the resources to speak to every affected customer and agree a repayment plan. Unless pandemic-style mass solutions are found, more customers face being switched over to expensive prepayment meters (if you have a smart meter, energy companies can do this without having to enter your home). Lack the cash to top up? You will literally be left sitting in the dark.In an indication of the expected scale of the fallout, several charities are working up plans to create “warm spaces” in community buildings across the UK for people who can no longer afford to heat or even cook in their homes.The government’s existing support package will give every household an energy rebate of £400, regardless of income, to get through the winter months. If you can afford to donate yours to help fund the frontline work of fuel poverty charities, I would urge you to do [email protected]; Twitter @Claerb; Instagram @Claerb More

Power problems will continue to plague Europe, while the central bank spotlight falls on New Zealand.Here’s your week-ahead in markets from Sujata Rao in London, Ira Iosebashvili and Lewis Krauskopf in New York, Vidya Ranganathan in Singapore, Riddhima Talwani in New Delhi and Sumanta Sen in Mumbai.1/ RETAILERS ROUND OFF EARNINGSInvestors will be looking out for what the biggest U.S. retailers have to say on rising prices, after a rare bit of good news on inflation in the past week.Walmart (NYSE:WMT) and Target (NYSE:TGT), which report second-quarter earnings on Tuesday and Wednesday, respectively, have recently cut forecasts and warned inflation was squeezing margins and forcing consumers to reduce discretionary purchases.Retailers’ outlook for consumer behavior will be key for investors looking to assess the pace of inflation. U.S. consumer prices were unchanged last month, the largest month-on-month deceleration of price increases since 1973.Other big retailers reporting include Home Depot (NYSE:HD) on Tuesday and Lowe’s (NYSE:LOW) the following day, while U.S. retail sales data, set for Wednesday, will give a broad picture of how the consumer is faring. GRAPHIC: U.S. retail sales https://graphics.reuters.com/GLOBAL-MARKETS/THEMES/zgpomgndnpd/chart.png 2/ EUROPE’S SICK MAN GETS SICKERWith the Bank of England’s dire warnings still ringing in their ears, traders can expect no cheer from UK upcoming data. British consumer inflation figures for July due Wednesday will likely top June’s 9.4% print, heading towards a 13.3% peak forecast for October.    The BoE predicts a long and deep recession, evidence of which may come from July retail sales data out on Aug. 19. Sales slumped 5.8% year-on-year in June, while consumer confidence is languishing at its lowest since 1974.     The UK labour market has so far been robust; almost 300,000 jobs were added in the quarter to May, leaving unemployment at just 3.8%.     However, adjusted for inflation, pay excluding bonuses fell by the most since records began in 2001. Another such reading may emerge on Tuesday, just as rail workers prepare for more of the strikes that have paralysed public transport this summer. GRAPHIC: UK economic data https://graphics.reuters.com/GLOBAL-MARKETS/THEMES/byprjyqwxpe/chart.png 3/ STILL GOING 50-50 DOWN UNDERTight labour markets in New Zealand and Australia are making it difficult for both the inscrutable Reserve Bank of New Zealand and the more vocal Reserve Bank of Australia to find a middle ground on rate hikes. Investors are certain RBNZ Governor Adrian Orr is not yet ready to compromise on inflation and will raise rates by another 50 basis points on Wednesday, notwithstanding the slight easing of inflation expectations and cooling property prices. What the RBNZ signals about wage growth could sway current expectations for a peak policy rate of 4% early next year.Second-quarter wages data in Australia is due the same day, and anecdotal signs suggest the tightest labour market in five decades also will set the RBA up for 50 bps next month, and for 225 bps of tightening in four months – a pace unseen since the 1990s.Norway’s central bank meanwhile is expected to hike rates when it meets on Thursday. It raised rates by 50 bps in June and some economists expect big hikes in August and September. GRAPHIC: New Zealand’s monetary policy woes https://graphics.reuters.com/GLOBAL-MARKETS/THEMES/dwpkrwzbmvm/chart.png 4/ PRAY FOR RAINAlready reeling from gas supply shortages, Europe faces soaring electricity prices and possible power cuts, as blistering summer weather sends water levels to critically low levels in rivers, lakes and reservoirs.    Along the German stretch of the Rhine, barges can only sail with partial loads of coal, threatening output at power plants. Norway, experiencing low rainfall after a winter with relatively little snow, may cap hydropower exports to preserve its reservoirs.      As a result, German baseload 2023 contract, Europe’s benchmark, has hit record highs, almost doubling since mid-June.   GRAPHIC: Price scaling new peaks https://graphics.reuters.com/GLOBAL-MARKETS/THEMES/gkplgolervb/chart.png 5/ HOME RUNThe cooling U.S. housing market gets a couple of gut checks in the coming week. July data on housing starts is due on Tuesday, after new U.S. home-building activity fell to a nine-month low in June.Data on U.S. existing home sales for last month is released on Thursday after such sales fell for a fifth straight month in June to the lowest level in two years.However, a moderation in mortgage rates could underpin support for housing, with the 30-year rate trending lower since mid June after doubling in 2022. The SPDR S&P homebuilders ETF has rebounded 25% since mid June after getting pummelled in the first half of the year. GRAPHIC: U.S. housing market https://graphics.reuters.com/GLOBAL-MARKETS/THEMES/klpykwnropg/chart.png More

Good evening from a sweltering LondonEuropean governments continue to search for ways of weaning themselves off Russian power before huge increases in energy bills hit households over the next few months.The latest push came with German chancellor Olaf Scholtz’s backing for a new gas pipeline linking Spain and Portugal to central Europe via France. The proposal, backed today by Madrid and Lisbon, could be ready within nine months, according to Spanish energy and environment minister Teresa Ribera. In the meantime, according to Portuguese prime minister António Costa, the port of Sines on his country’s south-west coast could be used as a hub to ship liquefied natural gas into Europe. LNG is becoming increasingly important as Russian gas dwindles, but Europe faces strong competition from Asia to lock in supplies for the winter months.The EU has identified the lack of alternative pipelines as a key obstacle in beefing up the bloc’s energy infrastructure. Berlin is already under serious pressure after Russia cut flows through Nord Stream 1, the key connector with Europe, which is currently running at just 20 per cent capacity. German households are bracing for a surge in heating bills this winter as the shortfall pushes up prices and complicates the country’s efforts to fill its gas storage facilities.A range of government measures to tackle the surge in energy prices are in operation across Europe, from price caps to tax cuts, windfall taxes and subsidies. Low rainfall is also complicating matters. Norway this week said it would curb electricity exports to Europe if water levels for its hydropower plants remained low, denting hopes it could come to its neighbours’ rescue. And in Germany, low levels on the Rhine are adding to business worries: inland waterways may only account for about 6 per cent of German transport volumes but are used to ship 30 per cent of coal, crude oil and natural gas.In the UK, forecasts for household energy bills continue to escalate, fuelling a deepening cost of living crisis. The latest, from consultancy Auxilione, suggests the average could top £5,000 next year, following a steep rise in wholesale gas prices. Ministers are meeting power company chiefs to discuss possible remedies, while also drawing up plans to combat the threat of outages this winter. On the positive side, a common front against Russia’s energy squeeze has improved fractious relations between the UK and the EU.The IMF last week suggested European countries pass on increased energy costs to consumers to encourage energy saving and the shift to greener power, albeit with targeted help for poorer households that are disproportionately affected by the increases. Meanwhile, the International Energy Agency said western sanctions had only had a “limited impact” on Russian oil output. Although exports have fallen to Europe, the US, Japan and Korea, the routing of flows to countries such as India, China and Turkey has mitigated the country’s losses. The IEA also lifted forecasts for oil demand thanks to its increased use for power generation in Europe and the Middle East as gas becomes too expensive. Amid the gloom there are some crumbs of comfort for consumers. US petrol prices have dipped below $4 a gallon for the first time since Russia’s invasion of Ukraine. The trend is also being replicated in Europe, reports our Energy Source newsletter: EU drivers are paying 9 per cent less than in June and British drivers 8 per cent.Latest newsFarmers fight to save stunted crops in record UK heatOutgoing UK PM Boris Johnson admits cost of living support not enoughUS import prices fall for the first time this year For up-to-the-minute news updates, visit our live blogNeed to know: the economyNew UK GDP figures this morning showed the economy shrank 0.1 per cent in the second quarter, following growth of 0.7 per cent in the first three months of the year, as households cut spending and falling Covid cases and testing depressed health output. The country also reported its worst trade deficit since records began.Latest for the UK and EuropeDrought was formally declared across parts of England, as the UK suffers its driest summer for 50 years, with rainfall, river flows, soil moisture, groundwater and reservoir levels all much lower than normal.Industrial production in the eurozone increased for the third month in a row, raising hopes that supply chain problems may be easing. The June rise of 2.4 per cent on the previous year was well ahead of the 0.8 per cent forecast by economists.The German economy, in particular its industrial sector, has been hit hard by surging inflation, supply chain issues and faltering global demand. Growth in what was traditionally Europe’s powerhouse has stagnated, with the IMF slashing its 2023 forecasts. On top of this, severe drought along the Rhine poses a massive threat to business.Global latestFed official Mary Daly told the FT it was too soon to “declare victory” against inflation despite Wednesday’s encouraging CPI report. She did however signal support for the Fed to slow the pace of its interest rate increases. Columbia’s first leftist government in modern times is targeting the wealthy and the country’s commodities exports in a major tax reform. The measures aim to raise an additional $5.8bn next year or 1.7 per cent of GDP.Argentina raised interest rates to 69.5 per cent as inflation leapt 7.4 per cent in July from the previous month, marking an annual increase of 71 per cent.Need to know: businessThe head of SMIC, China’s top chipmaker, said geopolitical tensions were creating panic in an industry already beset by high inflation and a gradual downturn in demand. US west coast editor Richard Waters says the use of data is moving to the forefront of regulators’ antitrust concerns. Lina Khan, chair of the US Federal Trade Commission, has emphasised the need to act more aggressively against vertical integration — deals that combine companies in different parts of a value chain, such as Amazon’s purchase of iRobot. Pandemic-related migration to Florida has led Miami to become the new boom town for corporate lawyers.Beijing’s zero-Covid policy and weak consumer confidence has battered China’s second-hand market for luxury goods such as high-end watches and handbags.One high-end industry definitely not on the rocks — unless you like it served that way — is Scotch whisky. The spirit has proved surprisingly resilient considering the headwinds of Brexit changes in trade rules, supply chain problems and surging inflation. The number of Scottish distilleries is at its highest since the second world war.Steady progress is being made on driverless cars, writes innovation editor John Thornhill, but the lack of public acceptability and legal certainty could yet prove the industry’s biggest roadblock. Carmakers are also facing challenges in their drive towards an electric future. China has monopolised supplies of materials for electric batteries while the cost of those that remain on the market is soaring. Chinese company CATL today announced a €7.3bn battery plant in Hungary, confirming its status as the world’s largest car battery manufacturer.Science round upNorth Korea declared “victory” over Covid-19, just three months after first admitting to an outbreak of the virus, with a total death toll of just 74. Experts are sceptical, given the lack of mass testing, while some suggest it may have more to do with wanting to revive trade with China.The Omicron variant continues to cause havoc in parts of the world. Tibetan cities were locked down after experiencing their first Covid outbreak in two years. Lockdowns have also affected popular Chinese tourist destinations such as Hainan.There was however optimism in Hong Kong, which this week shortened its hotel quarantine for international arrivals to three days.The EU drugs regulator said it would await trial data before approving vaccines designed to tackle the original coronavirus and the Omicron variant. The decision contrasts with the US, which is planning to approve the jabs before data on their efficacy are released.BioNTech and Pfizer are starting clinical trials for vaccines targeting the BA.4 and BA.5 variants of Omicron. BioNTech reported lower sales and earnings than expected in the second quarter after the EU renegotiated its Covid vaccine contract amid a glut of shots. Pfizer is also testing a vaccine for Lyme disease.Novavax also pointed to lower demand for jabs as it slashed its 2022 revenue forecast. People in rich countries have become more reluctant to take repeated booster shots, while vaccine hesitancy is still a factor in poorer nations.Health authorities are increasingly focused on the threat from monkeypox. Vaccines are in short supply across Europe, and in the UK could run out this month. Another potential danger is poliovirus, which has been detected in London sewage, prompting the rollout of a vaccine booster to children in the city aged one to nine.Get the latest worldwide picture with our vaccine trackerSome good news…Columnist Sarah O’Connor picks out a cheering nugget from some new official statistics. Compared with pre-pandemic times, Britons are spending more time socialising, relaxing and keeping fit and less time commuting. Long may it continue.

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WASHINGTON (Reuters) – The Biden administration on Friday announced it is putting more than $3 billion into two federal programs to help communities deal with floods, wildfires, extreme heat and other problems imposed by climate change. Funding for the Building Resilient Infrastructure and Communities (BRIC) program, which funds projects that protect people and infrastructure from natural hazards and the effects of climate change, will more than double to nearly $2.3 billion.The Flood Mitigation Assistance program, which funds projects to help mitigate flood risks for homes and communities, will see a five-fold increase in funding to $800 million.Some of the funding for the two Federal Emergency Management Agency programs will come from last year’s bipartisan infrastructure law, with $700 million for the flood program, and $200 million for BRIC. The rest will come from FEMA’s Disaster Relief Fund.”Chronic lack of investment in climate resilience has only made matters worse for America’s crumbling infrastructure,” FEMA Administrator Deanne Criswell said in a statement.”Unfortunately, these issues are magnified in historically underserved communities.” Through the funding “we seek to correct this injustice and ensure that every community is better able to prepare before disasters strike,” Criswell said.Last year, in just one example of the type of disaster that scientists say are made worse by climate change, Hurricane Ida https://www.reuters.com/markets/commodities/killer-heatwaves-floods-climate-change-worsened-weather-extremes-2021-2021-12-13 hit Louisiana as a Category 4 storm, killing nearly 100 people and causing an estimated $64 billion in damage.The White House said in April https://www.reuters.com/world/us/exclusive-climate-change-could-cost-us-budget-2-trln-year-by-end-century-white-2022-04-04 that the upper range of climate change’s hit to the U.S. budget by the end of the century could total a 7.1% annual revenue loss, equal to $2 trillion a year in today’s dollars.(This story corrects to fix Criswell’s name on second reference) More

(Reuters) – U.S. import prices fell for the first time in seven months in July, helped by a strong dollar and lower fuel and nonfuel costs, while consumers’ one-year inflation outlook ebbed in August, the latest signs that price pressures may have peaked.Import prices, which exclude tariffs, fell 1.4% last month after rising 0.3% in June, the Labor Department said on Friday.That was the largest monthly drop since April 2020 and exceeded the 1.0% decline expected by economists in a Reuters poll. In the 12 months through July, import prices gained 8.8% after a 10.7% rise in June, marking the annual rate’s fourth straight monthly decline.The report followed other tentative indications earlier this week that inflation was finally coming off the boil. U.S. consumer prices were unchanged in July due to a sharp drop in the cost of gasoline, after advancing 1.3% in June, although underlying price pressures remained elevated. Producer prices also declined last month on the back of lower energy costs.”Declining import prices and producer prices support the … thesis that the economy is past headline peak inflation,” said Jeffrey Roach, chief economist at LPL Financial (NASDAQ:LPLA). GRAPHIC: U.S. import and export prices drop sharply (https://graphics.reuters.com/USA-ECONOMY/INFLATION/lbvgnajkgpq/chart.png) The Federal Reserve is mulling whether to raise its benchmark overnight lending rate by 50 or 75 basis points at its next policy meeting on Sept. 20-21, as the U.S. central bank battles to cool demand across the economy and bring inflation back down to its 2% goal. The Fed has raised its policy rate by 225 basis points since March.Richmond Fed President Thomas Barkin reiterated following Friday’s data that he and his fellow policymakers will not let up on raising rates until they see long-lasting evidence that price pressures are firmly on a downward path.”I’d like to see a period of sustained inflation under control, and until we do that I think we are just going to have to move rates into restrictive territory,” Barkin told CNBC.Imported fuel prices dropped 7.5% last month after surging 6.2% in June. Petroleum prices declined 6.8%, while the cost of imported food fell 0.9%, the largest one-month drop since November 2020 and third straight monthly decline.Excluding fuel and food, import prices dropped 0.5%. These so-called core import prices decreased 0.6% in June. They rose 3.8% on a year-on-year basis in July. The strength of the U.S. dollar is helping keep a lid on core import prices.The dollar has gained around 10% against the currencies of the United States’ main trade partners since the beginning of the year.The report also showed export prices fell 3.3% in July after accelerating 0.7% in June. Prices for agricultural exports declined 3.0%, with the fall led by lower prices for soybeans, wheat and cotton.Nonagricultural export prices fell 3.3%. Export prices rose 13.1% on a year-on-year basis in July after increasing 18.1% in June.GASOLINE PRICESU.S. consumer sentiment ticked further up in August from a record low earlier this summer and American households’ near-term inflation outlook eased again on the back of the sharp drop in gasoline prices, a survey from the University of Michigan showed.The survey’s preliminary August reading on the overall index on consumer sentiment came in at 55.1, up from 51.5 in the prior month. It had hit a record low of 50 in June.The preliminary August reading was above the median forecast of 52.5 among economists polled by Reuters. GRAPHIC: UMich (https://graphics.reuters.com/USA-STOCKS/byprjymgzpe/umich.png) The survey’s one-year inflation expectation fell to a six-month low of 5.0% from 5.2%, while the survey’s five-year inflation outlook edged up to 3.0% from 2.9%, holding within the range that has prevailed for the past year. More

WASHINGTON (Reuters) – A corporate minimum tax in a congressional spending bill set for passage on Friday will not bring the United States into compliance with a separately negotiated 137-country deal for a global minimum tax.Although both taxes are the same rate – 15% – they are separate items that apply differently to companies.The U.S. House of Representatives was scheduled to vote on Friday on the $430 billion legislation, already passed by the Senate, and send it to President Joe Biden’s desk for signing into law, a political triumph for his Democratic Party ahead of the Nov. 8 midterm election. Maverick Democratic Senator Joe Manchin, who struck the legislative deal with Senate Majority Leader Chuck Schumer, his fellow Democrat, has not backed the global tax plan.Manchin told West Virginia Metro News radio that the bill does not include an “offshore” minimum tax, adding: “Our international corporations, we didn’t do anything that would cause them to be uncompetitive in the global market.”Once signed into law, the climate and healthcare investment bill will leave the U.S. Treasury without a path to implement the 15% global minimum tax deal approved by Organisation for Economic Cooperation and Development countries in October 2021. To comply, the Treasury would need to raise the current overseas minimum corporate tax known as “GILTI” from 10.5% to 15% – a move opposed by Republicans and by Manchin in the past. Biden has supported the corporate minimum tax bill, which would fulfill a campaign promise to make U.S. corporations pay more than the dwindling percentage of the federal budget they have contributed since the 1940s. It will finance the Democrats’ slimmed-down $430 billion climate change and prescription drugs bill. But lawmakers, congressional aides, and tax experts say it will not bring the country into compliance on the global minimum tax. The U.S. Treasury also acknowledged that additional compliance steps were needed. The legislation’s proposed 15% domestic tax on companies’ “book income” of at least $1 billion annually is distinct from the global minimum tax plan, said KPMG’s Washington National Tax practice chief Manal Corwin.”Accordingly, its adoption does not bring the U.S. rules into alignment with the global minimum tax architecture embodied in Pillar Two of the OECD proposal,” Corwin said.A key distinction in the Schumer-Manchin bill are allowances for certain business tax credits, such as for research and development and other investments, unlike in the global minimum tax plan. Under the global minimum tax, U.S. companies with big tax credits could comply with the proposed domestic minimum but still be subject to a top-up tax on overseas profits, Corwin said.Some who oppose the global minimum tax, including Manchin, say this would diminish the benefits of such credits.U.S. Treasury Secretary Janet Yellen, who was a driving force behind the 15% global minimum tax deal last year and has cajoled holdout countries to support it, is not giving up on U.S. implementation.Referring to the new legislation, a U.S. Treasury official said: “The Inflation Reduction Act’s domestic corporate minimum tax is an important provision to ensure large corporations pay their fair share in taxes. The global minimum tax remains a top priority of the Biden Administration and there are still steps needed to bring the United States into compliance.”Yellen has said she will look for every opportunity to enact the global corporate minimum tax, which she helped negotiate.If other countries move ahead with the minimum tax plan, they would be able to collect top-up taxes from U.S. companies that would otherwise flow to the Treasury, Yellen has argued, putting pressure on U.S. lawmakers to implement the tax and keep those revenues in the United States instead. More

Children are feeling the effect of the UK’s cost of living crunch, with almost a third of parents cutting back on pocket money.Halifax’s annual Pocket Money survey reveals that average weekly pocket money has fallen by 23 per cent, from £6.48 last year to £4.99 now.The cost of energy is the biggest worry for British parents, according to the survey, with 71 per cent of those surveyed naming it as their top concern.Energy bills are forecast to rise by up to 70 per cent in October, with a further rise expected in January 2023. Last week, the Bank of England warned UK inflation could hit 13 per cent by the autumn.In spite of a worsening economic climate, half of British parents said they were willing to sacrifice their own spending to maintain their children’s weekly funds. Leisure costs such as eating out as well as “treats” such as designer items were among the things parents said they were willing to cut back on.Since Halifax began tracking pocket money in 1987, interest rates and inflation have been clear influences on the amounts parents hand out.“In the main, periods of low inflation and therefore lower interest rates tend to correspond with higher or growing levels of pocket money,” Halifax said.A period of economic stability in the late 1990s and early 2000s led to a large increase in average pocket money, when it reached a peak of more than £8 a week in 2007. It fell back after the financial crisis, when interest rates fell sharply but inflation rose.There was another drop during the pandemic, as millions of parents faced an uncertain economic future.“More recently, a sharp increase in inflation has corresponded with a sharp fall in pocket money,” Halifax added.The most popular purchases using pocket money remain gaming and sweets, according to parents’ votes. Toys follow closely, as well as clothing, then hobbies such as books. More

UK prime minister Boris Johnson on Friday admitted that the government’s existing £37bn cost of living package may not be enough to support struggling households, as Liz Truss, the frontrunner to replace him, rejected calls for windfall taxes to limit the pain of rising energy bills.Johnson, who will leave office next month, said in north Wales that he would not “pretend” the economic situation was easy for the public, adding that ministers were focused on ensuring that the Treasury had “fiscal firepower” to help households in autumn.Asked if current support measures were enough, he said: “No, because what I’m saying what we’re doing in addition is trying to make sure that by October, by January, there is further support and what the government will be doing, whoever is the prime minister, is making sure there is extra cash to help people.”Earlier this year, the UK announced a £37bn package of measures, including one-off payments of £650 to those on means-tested benefits; £400 to ease the cost of energy bills; and £300 to the estimated 8mn pensioner households in receipt of the winter fuel payment. “I think it is very important for people to understand, most people have not yet received the help the government has already allocated,” Johnson added. “So over the course of the next couple of months you will see about 8mn households get another £326, you will see everybody in October get help with the energy support scheme.”Downing Street has ruled out making any major fiscal interventions before September 5, when a new prime minister is announced, despite warnings from Martin Lewis, founder of the MoneySavingExpert website, and former prime minister Gordon Brown that urgent support is needed.Energy consultancy Cornwall Insight has estimated that the energy price cap on customer bills could increase from its current rate of £1,971 a year to £4,427 by next April.Chancellor Nadhim Zahawi on Friday said the government was “looking at all the options” to help people through the winter. “We’re making sure we’re doing the work so on September 5 the new prime minister can hit the ground running and get those things into place,” he told Sky News.Johnson’s comments came after Truss on Thursday reiterated her opposition to imposing windfall taxes on oil companies, arguing that it amounted to “bashing business” and sent “the wrong message to international investors”. The foreign secretary’s economic pledges include tax cuts worth about £30bn, the reversal of the national insurance rise and a temporary moratorium on the green energy levy. “One thing I absolutely don’t support is a windfall tax,” she told Conservative party members during hustings in Cheltenham in the west of England. “I don’t think profit is a dirty word, and the fact it’s become a dirty word in our society is a massive problem,” Truss added.

In May, the UK introduced an energy profits levy on oil and gas companies, however, record profits reported by the sector have promoted renewed calls for further invention.Shell, Europe’s largest oil company, reported adjusted earnings of $11.5bn in the second quarter of this year, while the operating profits at Centrica, UK’s biggest energy retailer, rose to £1.3bn between January to June.Meanwhile, former chancellor Rishi Sunak has attacked his rival’s plans, arguing that tax cuts would do little to help the most vulnerable in society.“There are two groups of other people who will need more help: people on very low incomes and pensioners. Now, Liz Truss’s tax plans do virtually nothing for those people,” he said in an interview with Times Radio on Friday. More