Energy bills crisis: UK business leaders demand urgent action
Five of Britain’s leading business groups have demanded urgent and decisive government help to tackle the UK’s energy crisis, warning failure to act will result in lower investment, an increase in poverty and the risk of an inflationary spiral.
In a letter to Rishi Sunak, the heads of the CBI, the British Chambers of Commerce, the Institute of Directors, Make UK and the Federation of Small Businesses said “rocketing” domestic and business bills would put the brake on economic recovery.
“As a collection of business groups, we are writing to ask you to act urgently and decisively to support consumers with spiralling bills and help business manage inflated costs over the medium term,” the letter said.
Sunak and the business secretary, Kwasi Kwarteng, have been working on possible measures to soften the impact of an expected increase in energy bills of nearly 50% – amounting to £600 a year for the average household – when the price cap is lifted in April.
Ofgem, the energy regulator, will announce the new price cap early next month, and Kwarteng said Sunak would use his spring statement on 23 March to outline a support package.
In a reflection of the growing concern felt by companies of all sizes, the five business groups stressed the likely damage to household budgets if the government failed to act.
They noted a rise in the average household energy bill to £2,000 a year would alone add 1-2 percentage points to the annual inflation rate – already at a 30-year-high of 5.4% – and force a further 2 million people into fuel poverty.
“It will hurt low-income households most acutely, but these cost increases will have knock on impacts throughout the economy,” the letter said. “We therefore urge [the] government to take action to
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