The Trades Union Congress pressed Manchester Mayor Andy Burnham this week to reverse the bank surcharge and redirect the revenue into energy bill relief, arguing the policy could raise £9 billion over four years and provide immediate help to households struggling with utility costs.
The TUC's proposal surfaces amid persistent pressure on UK policymakers to address the energy crisis that has gripped households since late 2021. Energy bills have soared past £3,000 annually for many families, with winter months forcing difficult choices between heating and eating. The union federation sees a windfall tax on banking profits as a direct mechanism to fund relief without expanding public debt.
The bank surcharge, introduced in 2015 under the David Cameron government, taxes UK bank profits at 8 percent. The Conservative administration scrapped it in 2021 as part of its post-pandemic economic recovery strategy, eliminating a revenue source worth roughly £2 billion annually. The TUC now argues reinstating it would reverse a decision that handed money back to financial institutions while ordinary people faced unmanageable energy expenses.
Burnham, who leads the combined authority governing Greater Manchester and has emerged as a vocal critic of central government policy, holds considerable sway over regional economic priorities. His meetings with union leaders typically signal upcoming regional campaigns or political positioning ahead of mayoral elections and local authority budget cycles. His office has consistently advocated for devolved fiscal powers and additional funding from Westminster to address regional inequality.
The timing reflects broader political strategy. Labour, currently leading polls and positioning itself for potential government, has wavered on windfall taxes targeting energy companies specifically. A bank surcharge targeting a different sector could appeal to Labour's base without alienating business-friendly centrists within the party. The TUC's intervention adds grassroots pressure from unions, traditionally Labour's base, to push any incoming government leftward on tax policy.
Energy suppliers themselves have reported record profits in recent quarters, fueling public anger. Octopus Energy, British Gas, EDF, and other major players have faced boycott campaigns and legislative scrutiny. However, direct taxes on energy firms remain controversial among business leaders warning that higher costs get passed to consumers. A bank surcharge sidesteps that argument by targeting a sector less directly tied to household utility bills.
The proposal also reflects union priorities beyond energy. The TUC represents nearly 5.5 million workers across public and private sectors, many facing real wage decline due to inflation outpacing salary growth. Using bank profits to fund energy relief represents one lever in broader arguments for progressive taxation and redistribution.
Whether Burnham advances this proposal formally depends on Labour's positioning. If Labour wins the next election, union pressure could prove decisive in reopening tax debates settled by Conservative ministers. Reinstating the bank surcharge would signal a break from austerity-era fiscal policy and deliver concrete help to working families.