THE cost of living crisis is an “extremely difficult moment” for the country, a Government minister said yesterday as he held out hope that there would be further help for families later in the year.

Simon Clarke, the Chief Secretary to the Treasury, also issued a veiled threat to energy companies to up their investment in North Sea oil and gas or face a windfall tax.

But despite a growing clamour for more immediate Government action, Mr Clarke said the £22bn package of benefit changes and tax rebates would help families face the current difficulties.

“The £22bn is designed to address the immediate pressures of the situation, but we do need to be very mindful of the challenge that will come in the autumn,” he said, referring to the expected £300-£400 rise in the energy price cap on top of April’s £700 rise. “It will not be easy for families and so we need to start looking at our options now.

“We clearly are working up our evaluation of how we can help families in the months ahead."

Mr Clarke, the Middlesbrough South and East Cleveland MP, was visiting the Darlington Hippodrome theatre which had been helped to survive the last severe crisis – the Covid pandemic – by £2m of Government assistance through the furlough scheme and the Cultural Recovery Scheme.

Critics of the Government are calling for it to implement schemes of a similar magnitude to those that saw the country through the pandemic, but Mr Clarke said: “We need to make sure as we respond to a very fast moving situation that we make the right interventions at the right time so as to protect the public, but also we spent £400bn responding to the pandemic, so this year alone, we are spending £83m on our debt interest. Clearly, therefore, we need to be mindful of delivering best value for the taxpayer in terms of the steps that we take now.”

The £22bn package includes the £150 rebate on council tax, the autumn’s £200 energy loan, changes to Universal Credit which allow people to keep more of their earnings, and also July’s cut in National Insurance which, Mr Clarke said, would see 70 per cent of people paying less.

Among the voices calling for more immediate action is that of Labour leader Keir Starmer, who wants to introduce a windfall tax on the “excess profits” being made by the oil and gas companies which could fund a £120 cut off household’s energy bills.

Mr Clarke, who is effectively No 2 to Chancellor Rishi Sunak at the Treasury, said: “I’m not instinctively attracted to this because I don’t want to do anything that deters investment in the North Sea, and there is an absolute paramount need to unlock more North Sea oil and gas, which, incidentally, is crucial to Teesside jobs.

“On the other hand, there is an obvious expectation that the oil and gas companies that are doing so well at the moment will put that money into exploration, and if that doesn’t materialise then clearly we will have to evaluate every option and nothing can be ruled out completely.

“I am concerned that we are not seeing that investment going in.”

However, he would not set an “artificial timetable” on how the Treasury would judge the companies’ performance.

Mr Clarke said he expected inflation, which is currently nine per cent, to peak at 10.25 per cent later this year.

“It may go a little higher, but crucially the forecasts are that it comes down pretty steadily and we are back to two per cent by the end of 2023,” he said.

“This is an extremely difficult moment, one mirrored in America and Europe because the factors driving it are truly global: the dislocation to supply chains during Covid and the Russian invasion of Ukraine. Neither will endure for ever and we are confident we will get back on trend by the end of next year, so the question is how we best support families in the interim.

“There is a lot of work going on and we need to target whatever we do appropriately.”

The Government’s intervention during Covid saw the Hippodrome receive £1.7m from the Culture Recovery Fund and a further £234,000 from the furlough scheme, which helped safeguard 60 jobs. This enabled the theatre not just to survive but to pick up the pieces as soon as the pandemic passed, and in the year since its reopening, it has hosted 139 shows and sold tickets worth more than £2.6m.

Mr Clarke, 37, grew up in Marton in Middlesbrough and remembers seeing the Chuckle Brothers and the Krankies in panto at the Hippodrome.

“It was incredibly exciting as a child to come into the theatre and it still gives me a buzz coming here,” he said. “Government support has made all the difference to its survival in a period when it could not do live performances. It has been great to hear about how well it is doing with a full programme of events and full houses again.”