Ed Miliband has declared that the Conservatives are “missing in action” on the cost-of-living crisis after the government failed to agree any new support measures in a meeting with energy company executives.
Boris Johnson, Nadhim Zahawi and Kwasi Kwarteng met with energy company bosses earlier today. The Chancellor told attendees that the government is evaluating the “extraordinary profits” seen in certain parts of the electricity generation sector and considering “appropriate and proportionate steps to take”.
The Treasury revealed that Zahawi and the energy firms had agreed to “work closely” over the coming weeks to “ensure that the public, including vulnerable customers, are supported”. But the Prime Minister said it would fall to his successor to make “significant fiscal decisions”.
Commenting following the meeting the Shadow Climate Change and Net Zero Secretary said: “Britain faces a national emergency with rising energy bills and a cost-of-living crisis. Families are worried about how they will pay their bills.
“But instead of showing leadership, the Conservatives are missing in action. The Prime Minister and Chancellor have gone AWOL, whilst the candidates for the leadership have no substantive ideas about how to help working people meet the challenges they face.
“Labour will take the action that’s needed to get us through this crisis, with real action to bring down energy bills for families, and build a stronger economy for our country.”
The opposition party had urged ministers to use today’s meeting to close a “major tax loophole” in the windfall tax. Speaking on Wednesday, Rachel Reeves accused the Conservatives of “handing oil and gas giants billions in tax breaks, just for them to pass it on to shareholders”.
The government announced in May that it would be introducing an energy profits levy on the “extraordinary profits” of the oil and gas sector. Labour had been calling for such a windfall tax to be implemented since January.
The government’s levy includes a new investment allowance, a ‘super-deduction’ style relief intended to “encourage firms to invest in oil and gas extraction in the UK”. The investment allowance will mean businesses receive 91p in tax savings for every £1 invested in the North Sea.
The Shadow Chancellor declared: “The government should be ashamed this loophole existed in the first place. This isn’t right at a time when people are worried sick about how they’ll pay their bills.”
Labour noted that the loophole had been included “despite oil and gas producers announcing bumper profits”. BP reported last week that its profits had tripled to nearly £7bn in the second quarter of the year.
British Gas owner Centrica announced in July that its operating profits for the six months to the end of June were £1.34bn – well above the £262m reported for the same period last year.
Shell revealed that it made record profits of £9.5bn between April and June – an increase of 26% on the first quarter of this year, which was a previous high. The company plans to give shareholders payouts worth £6.5bn.
The opposition party is reportedly preparing to make several significant policy interventions on the economy to combat the rapidly worsening cost-of-living crisis.
PoliticsHome reported on Wednesday that Keir Starmer is expected to set out the details of the party’s first intervention in a speech, possibly as early as next week. Party insiders told the news website that the intervention will reflect “the scale” of the crisis and could be revealed as soon as Monday.
But according to HuffPost, the Labour leader will begin setting out Labour’s response on Friday. Starmer will reportedly trail some parts of the party’s plans ahead of a full announcement next week. HuffPost said reports Starmer will deliver a speech on Labour’s response to the crisis are “wide of the mark”.