The Labor leader said his plan would continue to push up household bills by freezing the energy price cap and would be paid for by introducing a new windfall tax on oil and gas company profits without a “big tax loophole” that has the unexpected tax of the government. Speaking in Exeter on Monday, the Labor leader said his “radical” plan would “get us through the winter” and accused the government of “saying absolutely nothing”. He admitted to Sky News that he would benefit from the scheme as everyone would get help, but said that although he could afford to pay £4,000 in energy bills a year on his salary of around £140,000, general help would help reduce inflation “about 4%”. “This plan will get us through this winter and there are so many people who are worried about what’s going to happen in the autumn, worried that they can’t pay their bills,” Sir Keir said. “So that’s a real response, a costed response to them, it’s really the opposite of what you have from the government saying absolutely nothing.” Is the plan to stop rising bills this winter workable? – Cost of living at the latest He continued: “The fear is that if the government doesn’t step up, prices, the average will go from around £2,000 to around £3,500 and then back up to £4,200. “We’re saying we’re going to hold it down, we’re not going to allow those prices to go up, and we’re going to make sure that those who are really making a lot of money out of it pay to hold those prices down. “And that’s the kind of plan that I think people are very, very receptive to.” Use Chrome browser for more accessible video player 2:46 Labour’s energy plan explained Sir Keir added that the support package “is mainly aimed at those households who will struggle to pay their bills during this winter”. The plan has been criticized for helping everyone with their bills, not just low-income households, but Sir Keir said it would help reduce inflation, which is expected to rise to more than 12% in October, the Bank said of England. But Sir Keir told Sky News: “This is general because many, many households are affected by it. “It has the huge benefit, but it doesn’t allow price increases to happen in October and January. “But it has another benefit, which is really important, it reduces inflation by 4% because it’s across the board.” He admitted the plan was only for six months “to get us through the winter” and a new plan would be needed in April next year as the situation would likely have changed by then. Sir Keir also accused the two remaining Tory leadership candidates – Liz Truss and Rishi Sunak – of failing to put forward “credible proposals” to tackle the energy crisis. Mr Sunak has unveiled a plan to cut rising energy bills for up to 16 million vulnerable people, which he hopes will propel him into Downing Street. While Ms Truss said tax cuts were the best way to help with the cost of living over the winter – but rejected calls for a windfall tax on the profits of oil and gas companies. It came as the prime minister’s official spokesman confirmed that Mr Johnson is on leave this week and that there will be no further intervention to ease cost-of-living pressures until his successor is named on September 5. Energy analysts have predicted that typical energy bills could rise to around £3,500 in October and above £4,200 in January. While bills are set to cost more than two months’ worth of average wages next year unless the government intervenes, a report has found. On Sunday night, Sir Keir pledged that people would not “pay a penny more” on their winter energy bills and that the party’s plans would immediately save the average family £1,000, control energy costs for the future and would help tackle inflation. The party said this would be achieved by preventing an increase in the energy cap this winter, which would be paid for by an extra tax on oil and gas giants. Read more: What is a windfall tax and has the UK tried it before? Credit Starmer to have a plan – but it’s a questionable short-term solution The price cap, which is the most companies in England, Wales and Scotland can charge an average customer for energy costs, should remain at £1,971. Plans in Labour’s ’emergency package’ include: • Freeze the price ceiling, which the party says will reduce inflation by 4% • Support for customers not protected by the price cap • Price equalization for prepaid and monthly bill payers • Closing a loophole in the levy on government energy profits • A pledge to use the £14bn of untargeted funding already committed to prevent rising bills • Insulate 19 million homes across the country over the next decade to reduce energy demand and lower bills Labor says removing “a big tax loophole” in the windfall tax announced by Rishi Sunak when he was chancellor earlier this year will help fund their plans. The party adds that new investment subsidies under the policy mean that for every £1 invested, £91.25m will go back to companies for extra tax breaks – despite oil and gas producers posting big profits. Labor says scrapping these new investment allowances and pushing back the start date to January, when the party called for a windfall tax, would raise £8bn, which could reduce household living costs. Read more: Who is proposing what to tackle the rising energy bills facing struggling households? Subscribe to the Daily Podcast on Apple Podcasts, Google Podcasts, Spotify, Spreaker However, the Institute for Fiscal Studies (IFS) questioned Labour’s explanation of how it would fund the support package. The think tank’s director, Paul Johnson, told BBC Radio 4’s Today show that the party’s plan to scrap the energy price rise – if extended from the proposed six months to a year – would cost as much as the COVID leave scheme . The government has announced that households will receive £400 to help pay their fuel bills this autumn. The prime minister admitted on Friday that the plans do not go far enough, but also reiterated his insistence that it is up to his successor to “make important fiscal decisions” after talks with energy bosses ended without new measures being announced.
