This morning, new Prime Minister Liz Truss outlined to Parliament her plans to deal with sky-rocketing energy bills, and sadly, those plans represent a failure for our residents and local businesses.
Instead of backing Labour’s plans, to freeze energy bills, and fund this through a windfall tax on oil and gas suppliers who are enjoying record profits, Truss has decided to allow bills to increase to £2,500 before capping them for only two years for households and six months for businesses, and to pay for this through government borrowing.
The incoming Prime Minister had a clear choice to make about the energy crisis. Limit bills faced by households and local businesses, charities, schools and colleges by standing with working families and taxing the astronomical profits being raked in by oil and gas companies; or stand against working families, defend record profits and fossil fuel gas companies, and force taxpayers to foot the bill. Unfortunately, if not unpredictably, she chose the latter.
6.7 million households in Britain are currently facing fuel poverty. Instead of freezing their bills immediately, the new Conservative Prime Minister is choosing to allow bills to further rise to £2,500.
The Treasury estimates that oil and gas companies are set to make a whopping £170 billion pounds in unexpected windfall profits over the next two years, partly as a result of Putin’s aggression in Ukraine. The head of BP has described the current energy crisis as a ‘cash machine’ for his company, and it’s working households on the other end of that cash machine.
The PM could have taxed those unexpected and unearned windfall profits in order to fund fuel poverty relief and bring household bills down. Instead, the former Shell employee, Liz Truss, has protected those record profits, meaning British taxpayers will foot the bill through future stealth taxes and borrowing costs.
This is a Prime Minister who is focussed on cutting corporation tax for the likes of Amazon, the water companies polluting our beaches and the banks gambling with our savings, whilst ordinary working families are forced to choose between heating and eating this winter.
Households will still see their bills rise as a result of the government’s plans, and taxpayers will still have to cover these costs in the future. Local businesses and charities meanwhile, only benefit from a six-month price cap guarantee. Where is the certainty our local businesses need to keep the lights on?
Furthermore, the Prime Minister told Parliament her plans had been agreed with energy companies (little surprise since it involved protecting their record profits, and potentially further deregulating the energy market), but where was the consultation with families and households who are expected to pay for them?
Truss claims her plans will bring energy prices down in the long-term, by decreasing our energy dependence on imports. How does she plan to do that? By investing in wind, solar, tidal and nuclear energy? Of course not. This is a government that banned onshore wind farms, hasn’t built a single nuclear power plant in 13 years, and blocked plans for tidal lagoons in Wales.
Instead, she wants to give a greenlight to fracking shale gas and plundering the North Sea. Her plan to deal with a fossil fuel crisis is to double down on fossil fuels. She appears hell-bent on this course of action, despite the fact her own Chancellor has described the idea that more North Sea gas will bring down energy prices as a ‘myth’, and that fracking for shale gas would take years, at great cost to communities and our climate, and – you guessed it – still fail to bring energy prices down.
This is not a government serious about tackling fuel poverty, or serious about combating the climate crisis. If they’d backed Labour’s plans last year to insulate 19 million homes, considering we have the draughtiest homes in Europe (a major cause of higher household bills), 2 million homes would already have been insulated and paying less for their energy bills by now. If they’d backed Labour’s Green New Deal and invested in renewable energy production at speed, we could all be facing cheaper bills this year. New wind and solar power is nine times cheaper than gas.
Liz Truss scrapped solar panel subsidies when she was Environment Secretary, and she served in Cabinet when the Tory government banned onshore wind farms in 2015, which has cost us the clean energy equivalent of all our Russian oil and gas imports in recent years and left us dependent on the global market.
The Prime Minister’s plans will compound the climate crisis and the cost-of-living crisis. In the short-term, bills for households and local businesses will still go up, and in the long-term, her plans to bring down bills are doomed to fail. And who is to pay for this calamitous programme? The taxpayer.
2 days. That’s how long Liz Truss has been in the job. And already she has proven she’s not up to it. That may be a record.
Sadly, our local residents and businesses will still suffer under her new energy plan, which proves once again that the change this country needs is not at the top of the Conservative party, it’s a Labour Government.
Cllr Carmen Appich & Cllr John Allcock
Co-leaders of the Labour Opposition
Brighton & Hove City Council