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Martin Lewis Explains £400 Energy Bill Reduction

Martin Lewis Explains £400 Energy Bill Reduction

Do Brits need to pay it back?

Money Saving Expert Martin Lewis has broken down what the new £400 energy bill reduction means for Brits after Rishi Sunak's announcement on Thursday.

Sunak announced this week that all UK households will be given £400 to help with the cost of energy bills, replacing the original £200 energy discount people were due to receive.

Among a series of new measures announced to help struggling households, the chancellor revealed every household in the UK would receive £400 off their energy bills in October.

Martin Lewis has explained what Brits can expect from the new energy bill grant.

This followed news that bills will once again rise by as much as 40 percent, taking the average bill to more than £2,800 per year.

For those concerned that they might have to pay back this £400 grant, Lewis was on-hand to share what people could expect.

Unlike the original £200 discount, which had been described by Lewis as a 'loan-not-a-loan' as it had to be repaid in 2023, the new and improved £400 discount will be a grant, meaning recipients are not required to pay it back.

Explaining it all on social media, Martin tweeted: "Many still confused about the £200 loan-not-loan. It has gone. Now in October all energy bills will be reduced by a flat £400. This is not repayable. This is a grant. Every household that gets an energy bill will get it"

Breaking down the key announcements, Martin explained that low income households could receive £950 while those who also have disabilities could expect to receive £1,100.

Pensioners are also being given £700 to help with the crisis while those in council bands A to D will receive a payment of £150.

Sunak announced the new plans in the House of Commons on Thursday as part of a £15 billion cost of living package.

From April, Ofgem's price cap rose from £1,277 to £1,971, meaning the average household bill could increase by around £693 per year.

Predicting that inflation will peak at 10 percent in the autumn – which is a record high – the Bank of England warned earlier this month that energy bills would once again rise this October by as much as 40 percent, taking the average bill to more than £2,800 per year.

Featured Image Credit: ITV/Shutterstock

Topics: Money, News