Business Secretary Jacob Rees-Mogg is set to lay out details of a major government support package for businesses – worth tens of billions of pounds – to ease the pain of soaring energy bills over the winter.
The announcement comes amid increased calls from businesses for certainty about electricity and gas costs so they can plan ahead after a summer of political inaction amid Tory leadership competition.
Ministers have said businesses, schools, hospitals, charities and other non-domestic consumers will be covered by the scheme after warning of the devastating impact on the economy if they fail to act.
The Government has already announced that bills for an average household in England, Scotland and Wales will be capped at £2,500 from October 1 – but although equivalent support has been promised to businesses, they have been awaiting details as officials ordered a tailor-made have created plan.
Because companies have not benefited from the existing energy price cap and are not always able to set their energy prices through fixed contracts, many are reporting projected energy cost increases of more than 500%.
The government plans a six-month program for all non-domestic energy consumers, but this will then be replaced with a targeted scheme focusing on the industries most at risk.
Kitty Ussher, chief economist at the Institute of Directors, said businesses would welcome government intervention but it was important they were given clarity on how it would work.
“It’s important to have the details because obviously companies need to be able to plan for the future, not just for the next few months but for the next few years,” she told BBC2’s Newsnight.
“If they’re not able to have the clarity, there’s little point in even making the announcement.”
Tina McKenzie, Policy Chair of the Federation of Small Businesses (FSB), said: “Our latest research shows that nearly two-thirds of small businesses are paying more for energy this year than last year, with two in five paying double, triple or twice as much overpay even higher increases in their bills.
“We hope that the energy price guarantee means equivalent support per unit of energy to the support that households receive.
“It’s designed to give businesses six months of certainty about their energy prices so they can plan for the winter with confidence.”
The complexity of setting up a new system has raised concerns that support for businesses may not be in place by October 1, and the FSB said aid should be retroactive if the system is not up and running by then.
“Many small businesses have October 1st as the start date for new contracts, so we’d like to see the price guarantee take effect then for those signing new contracts from that date, but also for those who have been pricing since the inception Bound by contracts Quotations have risen astronomically in recent months,” said Ms McKenzie.
“There should also be a backdating commitment now, especially if it doesn’t roll out before November.”
She also raised concerns about the prospect of a “cliff” in six months for companies that may not qualify for ongoing support.
She added: “There are no ‘vulnerable sectors’ and ‘non-vulnerable sectors’ when it comes to these energy increases, so we will encourage the government to take a broader approach so all who continue to do so are deeply covered.” .”
Speaking in New York, where she is attending the United Nations General Assembly, Liz Truss suggested that pubs would fall under longer-term support.
The Prime Minister told ITV News: “The Business Secretary is carrying out a review of exactly which companies will be included – this review will be completed within three months.
“I can assure people who own pubs that they are exactly the kind of businesses that get this longer-term support.”
https://www.belfasttelegraph.co.uk/news/uk/rees-mogg-to-unveil-details-of-business-support-package-42005499.html Rees-Mogg to unveil details of business support package