The cap Liz Truss would implement, at £2,500, still means your energy bills have doubled since this time last year
Wera Hobhouse is the Liberal Democrats’ Climate Change, Women and Equalities Spokesperson and MP for Bath
Liz Truss this month set out her plans to offer support to households with their energy bills. It came after OFCOM announced that the price cap would rise a further 80% on 1st October to over £3,500 a year. Even the Conservatives realised these spiralling costs were unsustainable.
Unfortunately, but all too predictably, the government failed to go far enough. Truss’s plan is a broken one. It is a ‘phoney freeze’. The cap she would implement, at £2,500, still means your energy bills have doubled since this time last year. In spring, the price cap rose by almost £700, to £1,971, pushing a further 3.5 million people into fuel poverty overnight. This half-hearted intervention will do little to reassure families that they will survive financially and have a way to heat their homes this winter.
The government cannot claim it was not offered examples of bold approaches that would have gone a lot further in solving the crisis. My colleagues and I at the Liberal Democrats have put forward a much stronger alternative than Truss’s ‘phoney freeze’. We would have frozen energy bills at the current price cap, saving further millions from falling into energy poverty. It is not acceptable to ask the British public to take on an additional burden this year and make them continue to pay more for their energy. Yet, that is exactly what the government is asking ordinary people to do. Even in the way the Conservatives want to pay for this plan.
Instead of piling the cost of the plans onto the oil and gas giants who continue to make obscene revenues, £170 billion in excess profits this year alone, the government wants you to pay. The Conservatives are planning to borrow £100 billion to fund this insufficient freeze. Borrowing that will be paid back through the taxes of working people. The correct thing to do is to enforce a strengthened windfall tax on these fossil fuel companies, as the Liberal Democrats were the first party to advocate for. Predictably however, the Conservatives could not pass up yet another chance to display their incompetence.
There are further holes in this plan. The Conservatives are refusing to protect businesses. The cap for businesses will only be in place for six months. In half a year’s time these companies will be exposed to further, massive hikes in their overheads and Truss is saying that there is nothing she can do. Through the first two-quarters of this year, the ONS estimates, we lost over 250,000 businesses. That is nearly 16% more closures compared to the first two-quarters of last year. If the cap is removed in six months time, as planned, I can only imagine the amount of business deaths we will see. The government has to look again at this plan.
A coherent, green, long-term strategy is also nowhere to be found. The Conservatives have come up with the absurd suggestions that we must recommence with the dangerous practice of fracking and review the financial viability of net-zero 2050. These policies will not stop energy price rises, they will make the situation worse. To avoid climate catastrophe, practices like fracking have to end and net-zero has to be achieved. These are facts obvious to everyone. The government refuses to see this as a positive, however. Constantly looking to ways to weasel out of their obligations. What they do not grasp is that we could save £1,800 a year on household bills by moving to net-zero technologies. Another open goal the government refuses to score.
Unfortunately, the bad news about rising costs no longer stops at energy bills. This month I spoke in the Commons about the government’s upcoming Financial Services and Markets bill. Like their other policies, it is deeply flawed. One of the ways it falls down is through its removal of 2008 reforms which protect consumers from volatile food prices. In April, 7.3 million people were already in food poverty, 2.6 million of them children. It is deeply negligent to potentially exacerbate this crisis at a time of sky-rocketing costs everywhere.
Unfortunately, actions like these are what we have come to expect of this government and its shameful policies. The Conservatives are a party in decline and they must be stopped before they drag this country down with them.
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