Jeremy Hunt’s plan to curtail energy support ‘has eradicated certainty’

The Scottish First Minister has hit out at Jeremy Hunt’s plans to cut support given to households amidst soaring energy bills, and said the move “eradicated what meagre certainty people and businesses” had.

Mr Hunt, the new Chancellor of the Exchequer, announced on Monday that the energy price guarantee, which capped gas and electricity prices for the next two years, will instead last for just six months with a more targeted approach taking its place next year.

Ms Sturgeon met with energy companies on Thursday, and after the government she leads called on Mr Hunt’s review of the scheme to be accelerated and for more support to be given to vulnerable customers already struggling to pay their bills.

“Even the current cap of £2,500 until April – while better than a rise to £3,500 – is still a very significant increase for households who are already struggling to pay their bills and heat their homes,” the First Minister said.

“Without further mitigation the increase to £2,500 under the energy price guarantee will see an additional 150,000 households in extreme fuel poverty.”

Ms Sturgeon’s government also called on Downing Street to do more to support households in Scotland who rely on alternative fuels to heat their homes, and to clarify protections for businesses following March next year as soon as possible to give them the “certainty and security they need to operate with confidence”.

The First Minister said that the Scottish Government was “working hard within its limited powers and finite budget to support people, business, public services and the economy”, but warned: “The deficiencies in the UK Government’s package mean we are still in an emergency situation.

“The economic outlook has been made far worse by other aspects of the mini-budget – most of which have now had to be reversed entirely.”

It was Ms Sturgeon’s second meeting with energy industry leaders in less than two months, and included Scottish Power boss Keith Anderson, Ovo Energy’s vice-president of operations Gareth Wood, and Citizens Advice Scotland’s chief executive Derek Mitchell.

At the meeting, The Scottish Government said they agreed longer-term certainty was urgently needed ahead of the anticipated price cap increase in April.

After the summit they agreed Holyrood would work with organisations to increase smart meter coverage north of the border, and partners will share data with the Scottish Government to “help inform calls upon the UK Government, to provide clarity on continued support for domestic and non-domestic consumers as soon as possible”.

The Scottish Government is also set to work with businesses to see how they can be supported with energy costs within its devolved powers.

But, Ms Sturgeon said, “more substantial reform of the energy market is needed to address the issue in the long term, and the power to do so lies with the UK Government”.

A UK Government spokesman said that “countries around the world are facing rising energy costs caused by Putin’s devastating invasion of Ukraine”.

“The energy price guarantee will save the typical household around £700 this winter, based on what energy prices would have been under the current price cap – reducing bills by roughly a third,” the spokesman said.

“A Treasury-led review will consider how to support households from April 2023, focusing support for those in need while reducing costs for the taxpayer.”

And on its support for businesses across the UK, the spokesman said their plans would give firms the “certainty they need to plan through the acute crisis this winter”. The review, they said, will also look at how to support businesses from April next year and target taxpayers money to the “most vulnerable”.