How does the UK's cost of living support compare to major European countries?

·Freelance news writer, Yahoo UK
·5-min read
Britain's Prime Minister Boris Johnson greets French President Emmanuel Macron as he arrives to attend the COP26 UN Climate Change Conference in Glasgow, Scotland on November 1, 2021. - COP26, running from October 31 to November 12 in Glasgow will be the biggest climate conference since the 2015 Paris summit and is seen as crucial in setting worldwide emission targets to slow global warming, as well as firming up other key commitments. (Photo by Christopher Furlong / POOL / AFP) (Photo by CHRISTOPHER FURLONG/POOL/AFP via Getty Images)
European leaders from Boris Johnson to Emmanuel Macron have overseen varying packages of support during the cost of living crisis. (Getty Images)

Millions of UK households are facing an unprecedented crisis this winter amid the soaring cost of living.

The latest forecast from energy consultancy Cornwall Insight has predicted the average annual energy bill will soar to £3,582 in October, before rising even further in the new year. It currently stands at £1,971, having been £1,277 before April.

This rise is largely down to a rapid increase in wholesale energy prices stretching back to the second half of last year. This was exacerbated further by Russia’s invasion of Ukraine, which saw Russia - a major player in global energy markets - cut supplies to Europe in response to widespread sanctions.

Energy bills are forecast to increase in October, January and April (Yahoo News UK/Flourish)
Energy bills are forecast to increase in October, January and April (Yahoo News UK/Flourish)

The impact of all this is not just being felt in the UK but households spanning Europe. Here, Yahoo News UK compares the UK government’s policy responses to mitigate the crisis to other major European countries.

UK

In May, then-chancellor Rishi Sunak announced a £400 energy bill rebate, for all households. That will be divided across six instalments starting in October.

Low income households in receipt of certain benefits will also receive an additional £650.

Watch: Public can expect more help on cost of living from next PM, says Johnson

With prices continuing to rise, though, it is widely acknowledged further support will be required.

However, the UK’s policy response is effectively on hold with Boris Johnson running a lame duck government having been forced to resign last month. It’s still more than three weeks before the winner of the Conservative Party leadership contest - and therefore next prime minister - is announced on 5 September.

Sunak, one of the two candidates, has said he is prepared to find up to £10bn of extra support, with a vision to cover the total cost for up to 16 million vulnerable people. His opponent Liz Truss has said tax cuts are her “first preference” but has refused to announce details of further support she might consider.

France

France announced its first package of support last autumn, with the 38 million people who earn less than €2,000 a month given a one-off €100 payment. Meanwhile, its gas prices were frozen until the end of 2022, with electricity prices held to a 4% rise.

In March, meanwhile, motorists were given a discount of 15 cents per litre. Earlier this month, France's parliament approved a €20bn inflation relief package, which includes a cap on rent increases.

It all means, according to the International Monentary Fund (IMF), the poorest 20% of French households have been among the least affected in Europe by the cost of living crisis.

How the cost of living crisis has impacted the richest and poorest households in Europe. (IMF)
How the cost of living crisis has impacted the richest and poorest households in Europe. (IMF)

Germany

Chancellor Olaf Scholz was forced to tell Germans they would “never walk alone” on Thursday amid warnings from spy chiefs that the crisis could lead to rioting.

The country remains vulnerable due to its historical reliance on Russian gas, while electricity prices in Germany are among the highest in Europe.

Read more: 'It's no good being p***** off': Cost of living crisis protest rallies to be held across UK

Scholz pointed to a €10bn tax relief package announced on Wednesday, insisting there will not be any unrest.

Previous packages have included €135 up-front payments to vulnerable citizens and 30 cent decreases in petrol prices.

Italy

Italy's latest €15bn package was confirmed at the start of the month. It included €6bn to extend previous measures and €5bn to remove taxes from energy bills. Meanwhile, people earning less than €35,000 a year were given a 1.2% discount.

In May, a €200 one-off payment for 28 million people, again on less than €35,000, was announced.

Spain

In June, Spain's proposed €6.3bn subsidy to lower wholesale electricity prices until the end of May next year was approved by the European Commission. Another measure, between April and June, saw motorists benefit from reimbursements of 20 cents per litre at petrol stations.

BARCELONA CATALONIA, SPAIN - AUGUST 10: An employee sets the temperature to 27 degrees in an establishment on August 10, 2022, in Barcelona, Catalonia, Spain. The first measures of the Energy Saving and Efficiency Measures Plan of the General State Administration (AGE) come into force today. Limit to 27 degrees the use of air conditioning in summer in public buildings, commercial spaces and department stores, transport infrastructure, cultural venues and hotels, as well as turn off the lights in shop windows and public buildings that are unoccupied from 22.00 hours will be the first measures that come into force on Wednesday. This is contained in the first package of energy saving and efficiency measures approved by the Government to rapidly reduce energy consumption in order to comply with European commitments arising from the conflict in Ukraine. In the case of all these initiatives, they will be valid until November 1, 2023. (Photo By Lorena Sopena/Europa Press via Getty Images)
A shop employee sets an air conditioning unit to 27C in Barcelona on Wednesday. (Getty Images)

Another eye-catching measure came into force this month and focused on energy consumption. Under this crackdown, shops, hotels and other public buildings have to limit air conditioning to 27C in summer, heating to 19C in winter and keep doors shut.

Ireland

In March, the Irish government announced €200 electricity credit payments to all households, double what had previously been planned. Electricity prices in Ireland are among the highest in Europe.

It was part of a wider €505 million package which also included a fuel allowance lump sum payment of €125 to 390,000 people.

Netherlands

In March, the Netherlands announced a €2.8bn package including raising a one-off energy allowance for low-income households from €200 to €800.

The government also reduced VAT on energy from 21% to 9% and cut fuel duties by 21% until April next year.

Belgium

In February, Belgium announced a VAT reduction, from 21% to 6%, on electricity bills between March and July, as well as providing every household with a €100 rebate. In March, fuel duties were also reduced by 17.5 cents per litre.

The country's social tariff to help low-income households pay energy bills was also doubled in its scope to include 900,000 families.

In June, it was announced the social tariff measures, VAT reduction and fuel duty cuts were to be extended until the end of the year.