MNI BRIEF: UK Chancellor Sunak Unveils GBP15 Billion Handout

The UK will launch a GBP15 billion financial package to help offset the rise in the cost of living, Chancellor of the Exchequer Rishi Sunak said Thursday. The package will change the fiscal/monetary policy mix and was not factored into the Bank of England's May projections.

Key elements of the package are a GBP8 billion handout to the less well-off, with one-off payments totalling GBP650 to those on benefits, with lump sum payments in July and the Autumn. In addition there are GBP400 across the board payments to help with energy bills, topping up previously announced loans that are now converted to grants. Sunak said that inflation should be tackled through independent monetary policy and supply side reform. The measures today are likely to, at the margins, push up on inflation by boosting consumption.

The move, Sunak said, will be in part funded by a 'temporary' tax on the extraordinary profits of gas and oil companies.