Downing St. Sees Delays to Business Energy Aid Plan But Pledges to Back-Date Payments
Energy regulator Ofgem announced in August it was raising its cap on household bills by 80 percent. But businesses are not protected by that limit and are bearing the brunt of soaring prices and the a knock-on effect on inflation, now at 10 percent n the UK.
The British government has promised to unveil its plan to help businesses struggling with soaring energy bills next week.
And Downing Street pledged to back-date payments, hinting there could be delays in putting the scheme into effect.
"We will confirm further details of the business support scheme next week," said a spokesman for Prime Minister Liz Truss, adding that the government was talking to energy firms, businesses and trade bodies to give them "reassurance."
Small and medium businesses are facing crippling rises in their energy costs. More than 70 percent of British pubs polled said they might have to close this winter as a result.
Trade body UK Hospitality CEO Kate Nicholls has written to new Chancellor of the Exchequer Kwasi Kwarteng urging the government to reveal its proposals quickly.
"Businesses must see action too, or more of the population will need direct support," Nicholls wrote. "We need a plan that cuts business costs, stimulates demand and tackles inflation."
Parliament has not sat this week as the nation observes 10 days of official mourning for Queen Elizabeth II, who passed away last Thursday at the age of 96 — two days after after inviting Truss to form a new government after her predecessor Boris Johnson officially resigned.
Truss announced last Wednesday that the government would cap household gas and electricity bills at a combined £2,500 per year. While the cost of that pledge has not yet been fully calculated, it is expected to be more than £100 billion — with taxpayers footing the bill over coming years.
Energy regulator Ofgem announced in August it was raising its cap on household bills by 80 percent. But businesses are not protected by that limit and are bearing the brunt of soaring international market prices caused by Western sanctions on Russia — with a knock-on effect on inflation, now at 10 percent n the UK.
The Downing Street spokesman admitted that the government was still trying to determine if the plan will need to be legislated for as an act of Parliament — possibly the first to receive royal assent from King Charles III. But he said the payments would be back-dated to the beginning of the autumn.
"We did recognise there is concern about the support but what we are saying is that we will be providing the support to cover their October bills," he said.
"We're still working through exactly whether it will need legislation," the spokesman added, stressing that: "We're having to build a brand new system to deliver this support, rather than using the existing one."