Halting price rises in both October and January will save the average family £1,000 and keep inflation under control during the cost of living crisis, according to Labour. Sir Keir said his “fully funded” £29bn plan to keep the cap at current levels over the winter would be partly covered by the extension of the windfall tax imposed on oil and natural gas giants gas. “Britain’s cost of living crisis is worsening, leaving people fearing how they will get through the winter,” he said. “This is a national emergency. Strong leadership and urgent action are needed.” Closing “absurd” loopholes in the windfall tax introduced in the spring by then chancellor Rishi Sunak, and backdating the levy to January, will raise £8bn, Labor said. The rest of the price freeze will pay for the use of the £14bn the government had earmarked for extra support to cover rising energy bills and £7bn of savings in debt interest payments through lower inflation. The energy price cap, the maximum amount companies can charge, is currently set at £1,971 a year – but is set to rise to almost £3,600 a year in October and over £4,200 in January. The End Fuel Poverty Coalition – a group of around 60 charities and civil society groups – welcomed Labour’s plan but insisted that extra financial support would be needed for those already struggling with increased bills. Simon Francis, co-ordinator of the coalition, told the Independent he hoped Sir Keir’s announcement was “the start of politicians finally waking up to the fuel poverty crisis this winter”. But he added: “We will also need to see additional support for some of the most vulnerable households.” Liberal Democrat leader Sir Ed Davey – who proposed an energy price freeze a week ago – scoffed at Labour’s policy timetable. “I’m glad you liked my proposal to cancel the energy price increase. I also have some thoughts on electoral reform that you can adopt,” he tweeted. Research by the Institute for Public Policy Research (IPPR), to be published on Monday, has reinforced the opposition parties’ view of freezing the energy price cap. It showed that freezing fuel bills would help keep inflation at just above 9 percent, as well as ease the burden on families. It comes as Tory leadership candidates Mr Sunak and Liz Truss face a call to more than double the level of support for low-income families to avoid a “catastrophe” over the winter. A coalition of 70 major charities signed an open letter to Ms Truss and Mr Sunak, warning that families on benefits face a £1,600 shortfall in the coming months, despite the Government’s existing £1,200 support package. Meanwhile, Chancellor Nadhim Zahawi is believed to have asked Treasury officials to draw up plans to cut gas and electricity bills by an extra £400 in January through a new loan scheme for energy providers. However, the new borrowing scheme will not be implemented quickly enough for the October increases. And there is no guarantee that either Mr Sunak or Ms Truss will undertake this plan to become prime minister. The End Fuel Poverty Coalition said the Treasury’s reported plan would not “touch the sides” of the huge increases people face in October and January. “The government is going overboard with plans to offer increases to existing support,” Mr Francis told The Independent. “This is a long way from what is needed – a comprehensive plan to provide emergency funding for households this winter.” National Energy Action chief executive Adam Scorer said on Sunday that the Treasury’s plan as reported “doesn’t seem proportionate to the cost of living crisis”. Mrs Truss, the strong favorite to be the next prime minister, is understood to have concerns about the £400 discount on the energy bill already announced by the Treasury earlier this year going to wealthier individuals and families. It could stop the planned £400 payment, which is due to be paid to all UK households this autumn, from going to “high earners”, according to The Sunday Telegraph. Bill Bullen, chief executive of Utilita Energy, shared his frustration at the timing of the Tory leadership contest and continued uncertainty – saying it was “not a good time to have a lame-duck government” in No 10 and Whitehall. “It would just be helpful to work with the team that’s actually going to implement whatever mechanism it is, because we’re running out of time here,” Mr Bullen told Times Radio during a discussion on possible measures ahead of the price rise in October. . The energy company chief called for “an appropriate cap on prices, especially for low-income households” in the long term – suggesting a new “social tariff” could be introduced for the poorest on a permanent basis.
