Jonathan Reynolds has said that “Conservative dither and delay has forced too many businesses to close” as ministers outlined the government’s long-awaited plan to support firms with the rising cost of energy bills.
Commenting following the publication of a support package for businesses this morning, the Shadow Business and Industrial Strategy Secretary argued that it is “farcical that the Tories have been unable to tell businesses at the sharp end of the energy crisis what they plan to do to help them until now”.
“Labour has been calling for support since the start of the year. Businesses have been crying out for detail on these plans and, even now, there are still questions about how much this will cost and who will pay for it,” Reynolds said.
“We have known a crisis of this scale has been coming for months and Conservative dither and delay has forced too many businesses to close, with the future still looking bleak. While the Tories prioritise the profits of oil and gas producers, Labour will always be on the side of business and the jobs they create.”
According to the government, the ‘energy bill relief scheme’ will fix gas and electricity prices for all firms for six months from October 1st while hospitals, schools, charities and other settings such as community halls and churches will also get help. Officials have not said how much the plan will cost.
The Department for Business, Energy and Industry said businesses will see prices for all non-domestic energy consumers at £211 per MWh for electricity and £75 per MWh for gas for six months. It is understood the plan will be reviewed after three months with an option to extend support for “vulnerable businesses”.
The scheme will apply to fixed contracts agreed on or after April 1st and variable and flexible tariffs and contracts, and the discount will be applied automatically to bills. Savings will be seen from October’s bills but received in November.
Liz Truss said the government understood the “huge pressure businesses, charities and public sector organisations are facing with their energy bills”, adding: “As we are doing for consumers, our new scheme will keep their energy bills down from October, providing certainty and peace of mind.”
The new Prime Minister faced criticism after claiming on Tuesday that higher energy bills for households are a “price worth paying” in exchange for energy security. She said: “Our long-term security is paramount. But what I don’t want to happen is for that to be passed on to bill payers.”
In response, a spokesperson for the Enough is Enough campaign said: “We live in a country where millions skip eating to keep going, where millions live in unheated homes, where millions of children grow up in poverty. Why is it always working people who pay the price that the privileged decide is worth paying?”
Truss announced earlier this month an “energy price guarantee” for households of around £2,500 per year. She told MPs that her Chancellor, Kwasi Kwarteng, would make a “fiscal statement” to outline the specifics of the plan and how the energy price freeze would be funded. His statement is expected on Friday.
Keir Starmer accused the Prime Minister at the time of “loading the burden” of the crisis on to working people and urged Truss to back Labour’s proposal of funding an energy price cap freeze through an expansion of the windfall tax.
“The real question the government faces, the political question is, who is going to pay,” Starmer told MPs. He said it was “ridiculous” to claim that a windfall tax would deter investment, as Truss has suggested, and argued that the Prime Minister is “driven by dogma, and it’s working people that will pay for that dogma”.