8:45 am, January 9, 2023
Car dealers are to get less help with their energy bills, after the government warned that existing spending was costing too much.
A reduced scheme to support firms with their energy bills is being announced to MPs by the Treasury today.
It comes as the current cap on the unit cost of electricity and gas for companies is set to expire at the end of March.
Government sources say the replacement will give a discount on wholesale prices, not a fixed price, with very heavy energy-using sectors getting a larger discount than other businesses.
The revised scheme is expected to offer help with bills for a further year, until March 2024.
Chancellor Jeremy Hunt, pictured, warned business leaders last week that the existing spending was ‘unsustainably expensive’, reiterating that it was always only going to run for six months.
No 11 says the levels of support have to be scaled back, arguing the current scheme costing more than £18bn can’t be kept up forever.
The support package covers not just businesses, but charities and public-sector organisations as well, including schools and hospitals.
Increases in energy bills will come at a difficult time for firms as the UK faces a predicted painful and prolonged recession, with consumer spending coming under severe pressure amid the cost-of-living crisis and workers demanding higher wages.
Last month, Rishi Sunak scrapped a taskforce launched by Liz Truss to shore up the UK’s energy security by striking long-term deals with gas suppliers.
The Energy Supply Taskforce, announced by Truss towards the beginning of her short tenure in No 10 as part of a package of measures to reform the ‘broken’ market, was wound down after just three months.
Spearheaded by Madelaine McTernan, who led the UK’s vaccine taskforce, the team aimed to agree long-term contracts with domestic and international suppliers to cut energy charges and boost the security of Britain’s stock.
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