HM Treasury has published a research note setting out its estimate of how the 2022 to 2023 Energy Bill Support measures affected Bank Rate and, through that channel, the cost of a new representative mortgage. It estimates that the GBP 40 billion spent on energy bill support could have increased the annual cost of a new representative mortgage by GBP 360 to GBP 850, with a midpoint estimate of GBP 605. The cost estimate uses Office for Budget Responsibility figures for the Energy Price Guarantee, Energy Bill Support Scheme and Energy Bill Relief Scheme. The increase in Bank Rate is calculated as a three-year average using the modelling approach previously published on GOV.UK, and the mortgage estimate assumes full pass-through from that average Bank Rate increase to mortgage rates. The representative mortgage is based on a new loan of GBP 215,000 over 29 years, using 3% as the baseline interest rate, corresponding to Bank Rate in the fourth quarter of 2022.
HM Treasury2026-05-21
HM Treasury estimates 2022 to 2023 energy bill support raised new mortgage costs by GBP 360 to GBP 850 a year
HM Treasury published a research note estimating the impact of 2022–2023 Energy Bill Support measures on Bank Rate and the cost of a new representative mortgage. It estimates that the GBP 40 billion support package could have increased the annual cost of a new GBP 215,000, 29-year mortgage by GBP 360 to GBP 850, with a midpoint of GBP 605, assuming full pass-through from the modelled Bank Rate increase.