No one should be cut off if they can’t pay their energy bills, says Zahawi | UK cost of living crisis
Chancellor Nadhim Zahawi has said households shouldn’t be cut off if they can’t pay their energy bills, as the Treasury looks at a range of options to help consumers cope with the coronavirus crisis. Cost of life.
Zahawi promised the government would expand the £37billion aid package announced earlier this year to help households cope with soaring energy costs. He told Sky News: “Nobody should be cut off because they can’t pay their bills.
“I work with the [energy] businesses…to make sure people who are really struggling get that help both financially and personally.
Consumers aren’t automatically cut off if they don’t pay their energy bills, but UK charities have warned a group urging customers not to pay this winter that there could be serious consequences.
Zahawi said he was “deeply concerned” about vulnerable people freezing this winter as they cannot afford to turn on their heating.
He said a new support package would ‘go beyond’ £37bn ‘because we know we have to send the message to Mr Putin that this strategy is not going to work, that’s why we have to targeting aid to the most vulnerable to enable us to extend that aid as far as we can”.
Gas prices were forced higher as Vladimir Putin’s regime cut supplies from Russia to Europe in retaliation for sanctions imposed following the invasion of Ukraine, driving up prices for consumers and raising fears of power outages this winter. Last week, energy regulator Ofgem raised the next price cap, taking effect in October, to £3,549.
Zahawi said there were “no easy options” to deal with the crisis but the Treasury was “preparing all options”.
Asked if there were two separate plans being worked out, depending on whether Liz Truss or Rishi Sunak would become prime minister next week, Zahawi replied: “No, what we do is we ensure that we examine the promises of the two candidates, but also to everything that we have said by the energy sector.
He added: “I am working with the Bank of England to see how we can provide better liquidity in the wholesale energy market. They tell me it would actually help with around £400-500 off the energy price cap.
He also said he was considering trying to strike a deal with companies developing electricity from other sources such as renewables for “a voluntary contract for the difference…at a lower price”, but added: “It won’t be ready until next winter”.
Truss, the widely tipped Tory leadership candidate to replace Boris Johnson as prime minister, has indicated she will suspend green levies on energy bills.
When asked if the action would be taken, Zahawi replied: “Not necessarily because in fact we have some leeway at the moment, certainly if you look at the capital side of the balance sheet.
“There are no easy options. That’s the only thing we know,” he said.
Zahawi is expected to be replaced as Chancellor by Business Secretary Kwasi Kwarteng if Truss becomes Prime Minister next week.