Energy bills could be cut for low-income households under cost of living plan

Energy bills could be cut for poorer households under government plans to ease the cost of living, The i Paper has learnt.

The Treasury is looking at ways to reduce standing charges on gas and electricity bills, which disproportionately hit people on lower incomes because they are imposed at a flat rate for everyone.

Ofgem launched a review of standing charges two years ago and is expected to require suppliers to offer low or no standing charge tariffs from early next year.

There has been speculation that Rachel Reeves is considering scrapping VAT on domestic energy bills as part of her Budget in November, with reports that one option on the table is to lower the 5 per cent VAT rate to zero.

But Labour MPs and campaigners including Money Saving Expert founder Martin Lewis have urged