Millions of households will receive a £400 discount off their energy bills and a £5 billion tax will be levied on oil and gas giants as Rishi Sunak moved to counter the soaring cost of living.

The Chancellor was forced to unveil emergency measures as part of a £15 billion package to tackle the impact of soaring inflation, which has reached a 40-year high.

As well as the universal payment there was targeted support for the poorest, the elderly and the disabled.

The MP for Barrow and Furness Simon Fell welcomed the announcement.

Mr Fell said: "The measures will have a direct impact for people struggling with high energy prices and the cost of living.

"Pensioners will receive a package of £850 after the £150 from the Council Tax rebate. It will support them when they need it the most." 

The £6 billion announcement of £400 in universal support from October replaces the initial plan for a £200 loan, with Mr Sunak scrapping the requirement to repay the money.

Other measures announced by the Chancellor included:
- A one-off £650 payment to more than eight million low-income households on benefits, paid in two instalments in July and the autumn at a cost of £5.4 billion.
- A £300 payment to pensioner households in November/December alongside the winter fuel payment, costing £2.5 billion.
- £150 to individuals receiving disability benefits, worth a total of £0.9 billion, paid by September.

The regulatory body for energy services OFGEM warned earlier this week that 12 million households across the UK could be pushed into fuel poverty. This is measured at paying 10 per cent or more of a household's income on energy. 

Tim Farron, Liberal Democrat MP for Westmorland, said: "Thank goodness that families will finally get support with their energy bills through a windfall tax.

"It's incredibly frustrating that the Government dragged their feet over it for so long while people struggled to heat their homes and feed their kids." 

He also said that the Government were 'saving their own skin' by introducing the windfall tax.

Yesterday at Prime Minister's Questions Boris Johnson had to face interrogation over the Sue Gray report, which looked into parties at 10 Downing Street over lockdowns.