The chancellor Jeremy Hunt has unveiled plans to slash national insurance and cut taxes for businesses, but his autumn statement has failed “the poorest households in cold and unsafe homes”.

From January, 27 million working people will see their National Insurance slashed from 12% to 10%, which the government says will put “£450 back into the pocket of the average worker earning £35,400 a year”.

Furthermore, tax is to be “cut and simplified” for two million self-employed people, “abolishing an entire class of NICs and cutting the rate of the NICs top rate from 9% to 8% – with an average total saving of around £350 for someone earning £28,000 a year”.

Meanwhile, the National Living Wage will rise by 10% in April, from £10.42 to £11.44 an hour.

Additionally, Hunt revealed “the biggest permanent tax cut in modern British history for businesses”, which will apparently help them invest for less and boost investment by £20 billion per year over the next decade.

However, fuel poverty charity National Energy Action has warned that the autumn statement fails the poorest households in cold and unsafe homes, as new polling reveals one in four UK adults have found it difficult to afford their energy bills in the past three months.

Adam Scorer, NEA’s chief executive, said: “The gaps in this autumn statement are devastating, especially for the poorest households. While increasing benefits in line with inflation is welcome, it does nothing to directly reduce energy bills or to help millions of low-income households not on benefits. An ‘average household’ is now paying £800 more per year to heat and power their homes since the start of the energy crisis.”

The autumn statement also revealed the government’s plans to maintain the triple lock for pensioners, raise benefits in line with inflation and increase Local Housing Allowance, and freeze alcohol duty frozen for six months.

Shadow chancellor Rachel Reeves has slammed Hunt’s statement, claiming that “the chancellor has lifted the lid on thirteen years of economic failure. We were told to expect an autumn statement for growth. But the economy is now forecast to be £40bn smaller by 2027 than the chancellor said back in March.

“Growth revised down next year, the year after, and the year after that too. The chancellor claims the economy has ‘turned a corner’, yet the truth is that under the Conservatives growth has hit a dead end. What has been laid bare today is the full scale of the damage that this government has done to our economy over thirteen years.

“And nothing that has been announced today will remotely compensate. Mortgages rising. Taxes eating into wages. Inflation high, with prices still going up in the shops. Public services on their knees. And too many families barely managing to make ends meet.”

Cllr Claire Holland, Acting Chair of London Councils, said: “Boroughs will continue to face massive budget pressures. Many are struggling to balance their budgets and the Autumn Statement leaves them teetering on the edge.

“London’s homelessness emergency is a key concern. After years of campaigning for an increase in Local Housing Allowance, we welcome the decision to end the freeze. Boosting LHA is essential for helping low-income Londoners pay their rent and avoid homelessness. This is good news for London renters and for boroughs’ hard-pressed homelessness services.

“But with one in 50 Londoners currently homeless and living in temporary accommodation arranged by their local borough, the housing crisis remains a critical risk to town hall budgets. Enormous and growing pressures can also be seen across other vital services, especially adult and children’s social care.

“We will keep pushing for more funding support in the face of these on-going challenges, as well as the long-term reforms to local government finance that are crucial for sustaining London’s local services in the years to come.”

In a statement, the Office of Budgetary Responsibility said: The economy has proved more resilient to the shocks of the pandemic and energy crisis than we anticipated. But inflation has also been more persistent and interest rates higher than in March.

“Higher inflation boosts tax revenues but also welfare benefits while higher interest rates push up debt servicing. But because departmental spending is left largely unchanged, this delivers a net fiscal windfall of £27 billion.

“The chancellor spends virtually all of this on a 2p cut in NICs, permanent tax relief for business investment, and further welfare reforms, leaving debt falling by a narrow margin in five years.”

Phil Andrew, Group Chief Executive of Orbit, said: “We welcome the chancellor’s announcement to increase the local housing allowance to 30%. This is a much-needed increase and has been a long time coming. The 6.7% increase in universal credit and benefits is welcome, as is the 8.5% increase in pensions at a time when the cost-of-living crisis continues to significantly impact our customers and residents.

“However, these measures won’t kick in until April 2024; it’s really disappointing to see such little immediate financial help from HM Treasury especially in relation to energy bills. Our research with Orbit customers showed that 72% said that they had turned their heating off completely to save money during the winter months. People need help and they need it now.”

Nicholas Harris, Chief Executive of Stonewater, said: “While the chancellor sees some hope for the future of the economy in the form of an unexpected increase in tax receipts and the recent reductions in inflation the tax cuts announced today provide little, if any, relief to our customers, whose income is already stretched more than many can manage.

“Despite the recent fall in the rate of inflation, the effective inflation rate for the poorest tenth of households is around 2% higher than it is for the richest tenth of households. Meaning, once again, that those that can least afford it are most affected by the impact of the cost-of-living crisis because the price of essentials went up at a higher rate, and low-income families typically spend a greater proportion of their income on these items.”

“We welcome the announcement that benefits will be increased in line with October’s inflation rate, at 6.7%, and the increase in the national minimum wage, which also broadens to 21 and 22-year-olds.

“We need to ensure that customers, of all income levels, but particularly those that are low paid, are aware of the support available to them, including social tariffs for utilities and home-working options.”

Cllr Shaun Davies, Chair of the Local Government Association, said: “The evidence of the financial strain on councils has been growing and it is hugely disappointing that today’s Autumn Statement has failed to provide funding needed to protect the services the people in our communities rely on every day.

“We are pleased government has acted on our call to unfreeze Local Housing Allowance rates, which is a positive step in helping to support the most vulnerable in our society afford rising rents. It is also good that the Government has committed to ensuring councils will be able to set planning fees to cover the full cost of processing some major applications which will mean local taxpayers no longer have to foot the bill.

“Supporting businesses, and easing the cost of living for households is important, but not if our public services continue to be chronically underfunded and unable to be there to support people when they need them. Adult social care remains in a precarious position, record numbers of households are in temporary accommodation and there are now more than 80,000 looked after children in England. The lack of additional funding in today’s announcement risks councils’ ability to meet this spiralling demand, provide critical care and support a healthy population with access to housing, training and jobs.

“Councils have worked hard to find efficiencies and reduce costs, but the easy savings have long since gone. It is wrong that our residents now face further cuts to services as well as the prospect of council tax rises next year, with councils having the difficult choice about raising bills to bring in desperately needed funding.

“Devolution gives local leaders greater freedom to take decisions closest to the people they represent. Where they are supported by all councils it is good to see new devolution deals announced today, including to those parts of the country outside cities. This needs to signal a genuine ‘local first’ approach to policy making across Whitehall, to ensure as many communities as possible benefit from devolution, including the removal of burdensome negotiations and top-down imposition of new structures.

“National economic growth can ultimately only be achieved if every local economy is firing on all cylinders. Only with the right powers and adequate long-term funding which allows councils to plan properly, can we play a lead role in unlocking the labour market, building new affordable homes, creating jobs, plugging skills gaps and delivering on other key government priorities.”

Full details of the autumn statement can be found here.