Healey leans toward a £100 warm homes top-up over the £3.2bn levy cut his energy secretary wants

Targeting is the cheaper way to blunt January's rise, and the narrower one. For a household on qualifying benefits, the top-up would take the warm homes discount from £150 to £250 ^[5][20] and offset about 23% of a cap rise of up to £442 ^[21]. Removing levies would reach every household but cover about 27% of the same rise ^[22]. It would also cost as much as £3.2bn ^[10], up to about three times the sum Healey is working with ^[23].

The pressure to go broader comes from inside government and outside it. Alex Chapman, head of economic and environmental policy at the New Economics Foundation, said: "A serious price spike is coming, and without action, bills will exceed the peak of the last crisis." ^[19] Miatta Fahnbulleh, the energy secretary, puts it as a question of fairness. "If we want a system that is resilient, if we want a system that can cope, if we want a system that ultimately can deliver the diversity of energy that we want, what is the fairest way in which we pay for it?" she told the Guardian ^[8].

The case against is about what can be undone. According to the Guardian, removing levies would lower inflation but would be difficult to unwind if energy costs fall ^[10]. Healey is already finding money for defence and for his fiscal buffer ^[3]. He is likely to raise taxes to pay for it, with higher bank taxes rumoured ^[4].

I think the smaller plan concedes more of Fahnbulleh's argument than its size suggests. Putting the top-up on taxpayers ^[6] accepts her premise that some of the cost of bills belongs with the exchequer. Her question had a second half: "That is both across the exchequer versus our bill-payers, and then within our bill-payers," she said ^[9].

The within-bill-payers half is what officials are drafting for after the budget: lower tariffs for poorer households or for those that use less energy ^[14]. A social tariff would make energy companies charge poorer households less per unit of electricity than richer ones ^[16]. A rising block tariff would price a set amount of "essential" use cheaply and charge more beyond it, an idea the New Economics Foundation proposed when Fahnbulleh ran the thinktank ^[18]. Either would change what suppliers may charge ^[11].

Andy Burnham, the prime minister, has set the horizon in years. "Within 10 years, I want those costs to be in line with our neighbours," he told the Labour conference ^[15]. This quarter's decision is a discount whose cost the Treasury controls. Next quarter's would be a pricing rule that charges some customers more per unit than others, with suppliers applying it ^[16][18].

Sources told the Guardian that final decisions have not been made ^[2]. Government sources had earlier insisted that Burnham's VAT cut on electricity would be the last support offered this year ^[12].