NEW Prime Minister Liz Truss has announced today that she will cap energy bills at £2,500 annually until 2024 for the average household, a move that has been welcomed in West Devon.
The huge support scheme could cost up to £150 billion, but Ms Truss refused to put a figure on it, saying ‘extraordinary times call for extraordinary measures’.
Businesses will get help, with prices capped for six months, a shorter period of protection than many had hoped for.
Tavistock Town Councillor and advice worker Ursula Mann said: ‘I welcome the extra support for anyone to help them afford their energy bills. This is a huge issue and I have lots of people I know who are struggling with their bills. This comes at the right time as bills are due to rise in October and especially with the coming winter when demand for heating and lighting will increase.’
MP for Central Devon, which covers Okehampton, Mel Stride said: ‘These are a set of big and bold measures that should bring relief to millions of households and businesses. We do need to better understand their cost however and impact on the public finances. With this in mind I and the Treasury Select Committee is calling on the Chancellor to instruct the Office for Budget Responsibility to provide a forecast of the impact of these measures.’
The energy price cap - the highest amount suppliers are allowed to charge households for every unit of energy they use - had been due to rise to £3,549 for a typical household from October.
To limit the amount customers’ bills go up by, the unit price will be capped, but bills will vary according to how much gas and electricity each household uses. The Government will compensate energy firms for the difference between the wholesale price for gas and electricity they pay and the amount they can charge customers.
Manager of Tavistock’s Business Improvement District Janna Sanders said the moves did not go far enough to help the businesses of West Devon; the BID is supporting the BusinessSOS campaign in which over 150,000 businesses from across the UK are urging Government to act on spiralling energy costs which are proving more detrimental than the pandemic.
They are calling for a reduction on VAT
• Headline rate reduced from 20% to 12.5%
• Business energy bills reduced from 20% to 5% to match domestic billing
Business Rates Relief
• 100% rate relief until 31st March 2023
Energy Rate Relief
• A discounted kwh price on all business energy bills
Janna Sanders said: ‘Liz Truss’s announcement today doesn’t really go far enough in terms of the requests the BusinessSOS campaign is putting forward. The price cap will certainly help but costs are still far higher than they were back in March. Reviewing this in three months with a view to providing further support to vulnerable businesses in six months time will almost certainly be too late for some. After the difficulties of the pandemic that were felt so greatly by businesses, more needs to be done!
‘It isn’t just about the cost to the businesses either, it’s about consumers having confidence in their own economics to come out and spend money.’