8:59 am, September 23, 2022
The government’s plan to help businesses cope with sky-high energy bills does not go far enough and will leave firms needing additional support, the Independent Garage Association (IGA) has warned.
Earlier this week, chancellor Kwasi Kwarteng launched the Energy Bill Relief Scheme, which will see the government foot around half the cost of businesses bills.
The scheme will fix wholesale energy prices for businesses at £211 per MWh for electricity and £75 per MWh for gas, initially for six months between 1 October 2022 and 31 March 2023.
New business secretary Jacob Rees-Mogg has hinted that the initiative could continue beyond that date, if bills continue to rise.
The news was welcomed by several trade bodies but the IGA believes its members could still be heading for trouble.
Stuart James, chief executive of the IGA, said: ‘We are pleased that the government has finally introduced support for businesses to help them with the extortionate cost of energy, following our communications with chancellor and secretary of state.
‘However, small businesses like garages will need help far beyond the next six months to keep their doors open, protect jobs and help prevent accidents on our roads.
‘Independent garages provide vital, affordable services that keep the UK’s vehicles roadworthy and roads safe, however we are already seeing reports that motorists are avoiding MOTs and car repairs to save money amidst the rising cost of living.
‘If garages are forced to raise their prices significantly to cover their energy costs in the near future, this could seriously impact road safety throughout the UK.’
The comments mirror a similar statement from the SMMT’s Mike Hawes who has described the scheme as ‘a short-term fix’.
Reacting to the announcement, he said: ‘This is a short-term fix and to avoid a cliff-edge in six months’ time, it must be backed by a full package of measures that will sustain the sector.
‘Manufacturers have consistently invested to drive down energy use but it remains one of their biggest costs, threatening competitiveness and viability.’
Read more about how rising bills are affecting the motor trade here.
