By Denis Sheehan MIH, Publisher, H&C News: Chancellor confirms end of current energy support scheme for businesses in March.
Chancellor Jeremy Hunt has now confirmed the worst fears of many hospitality businesses, government are set to announce plans to reduce energy support for businesses beyond the existing scheme ending in March.
In the Commons next week he will tell MPs it is “unsustainably expensive”.
The chancellor met business groups yesterday and told them he will reduce existing support with an alternative “lower level” package of measures to be available after March.
The new ‘support’ scheme will impact all non-domestic energy customers including businesses, hospitals, schools and charities.
Government insists the existing energy support scheme for businesses is one of the most generous in Europe, but they cannot continue to protect businesses from energy price fluctuations.
Following the meeting with business groups a government spokesperson said: “Extending the scheme at current levels could cost tens of billions of pounds, with costs potentially doubling or tripling if international energy prices increase further than expected. It is vital that taxpayer’s exposure to volatile international energy prices is reduced.
“However, the chancellor also heard the concerns of the business community who are facing high energy prices, and explained that any future support, while at a lower level, would be designed to help them transition to the new higher-price environment and avoid a cliff edge in support.”
The full detail of the reduction in financial support are promised by Hunt next week.