Cost of living payments for millions as Sunak announces windfall tax on oil and gas profits – UK politics live

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Speaking on Times Radio this morning Paul Johnson, director of the Institute for Fiscal Studies, repeated the point he made on the Today programme about the need for the cost of living support package to be targeted at those most in need. (See 9.25am.) He also said Rishi Sunak should ensure that his measures were not inflationary. He said:

There's a very strong case for giveaways to help those who are struggling most. But if you're going to do that, because of the dangers associated with inflation, there's a case for tax rises elsewhere so that there isn't significant additional money swirling around in the economy.

Now we do have some tax rises coming in this year, so the chancellor is already taking some money out of the economy. But I think he does need to think quite hard about that balance and the risks associated with inflation. What you generally don't want to do in the face of lots of inflation is chuck lots more money at the economy.