By Denis Sheehan MIH, Publisher, H&C News: The Treasury go vague on energy support for businesses 2023.
The Treasury has delayed their decision on whether they will extend support for hospitality businesses, and every business trying to deal with the spiralling cost of energy until the new year.
Ministers promised to make a statement before the end of 2022, which would have eased tension and worry around uncertainty. Government policy currently is to try and fix wholesale gas and electricity prices for businesses from this October through to March 2023, but energy suppliers have implemented in piecemeal fashion. For many in hospitality renewing contracts has been a nightmare.
Commenting on the delay to an announcement UKHospitality CEO, Kate Nicholls, said: “The Government’s postponement of an announcement on future energy support until the New Year, comes at a time when businesses are facing rising bills and rates that fluctuate daily. Operators thus need urgent clarity in order to make business critical decisions for 2023 and, in the meantime, we urge OFGEM to continue to pressure energy suppliers to deal fairly with commercial customers and to clamp down on poor practices and unfair terms.”
Businesses are not ordinarily covered by a price cap, which limits the amount energy suppliers can charge per unit of energy. Following unprecedented energy price hikes this year, the Truss government created the Energy Bill Relief Scheme to provide some security to businesses. But Truss and her Chancellor Kwarteng’s policies now seem as hollow as their economics.
Earlier this week On Monday, the Treasury said its final decision on continued support would not be announced until the start of 2023. The new Chancellor and The Treasury delaying their decisions will not aid business confidence.
Following the announcement the British Chambers of Commerce urged government to make an announcement before Christmas, as many of its members are already, and will continue to struggle paying energy bills.
The director general of the British Chambers of Commerce Shevaun Haviland said: “Just over a month ago, the chancellor promised businesses that they would receive a plan on the future of the energy support package before the end of the year. With 24 hours left until parliament rises, businesses have one simple question: ‘Where is this plan?
“Businesses now face an anxious and uncertain festive period, unable to plan for the New Year.”
A spokesperson for The Treasury said: “We are protecting businesses from high energy costs this winter, caused by Putin’s invasion of Ukraine, through the six-month £18bn Energy Bill Relief Scheme.
“However, this is very expensive, and we need to ensure longer-term affordability and value for money for the taxpayer.
“That is why we are currently carrying out a review with the aim of reducing the public finances’ exposure to volatile international energy prices from April 2023. We will announce the outcome of this review in the New Year to ensure businesses have sufficient certainty about future support before the current scheme ends in March 2023.”
