Businesses could face a delay of several weeks in accessing the financial support promised by Liz Truss to help ease the burden of spiraling energy bills this winter, Downing Street has admitted.
Amid reports the package for businesses would not be in place by October 1, the Prime Minister’s spokesman said there could be a “weeks delay” but insisted businesses would receive backdated payments .
They said this was not due to the 10-day period of national mourning following the Queen’s death, but because businesses did not have a price cap system, unlike households, meaning they had to build a “brand new” scheme.
The government has contacted energy companies and their representatives to urge them not to cut off supplies to companies that cannot pay their energy bills, if support takes longer to arrive than expected.
“We will confirm further details about the business support scheme next week,” Truss’s spokesman told reporters on Wednesday, after reports in the Financial Times of a delay appeared. They added that they acknowledged there were “concerns about support” but promised it would arrive before November.
Pressed on whether the scheme would start from October 1, when the energy price cap for households will freeze average annual bills by £2,500, the spokesman said: “At the moment I don’t have a date fixed for you It can come in parallel with the home support scheme.
“If there is a delay … we will push it back to cover October energy bills so businesses don’t miss out.”
Truss last week promised that a six-month plan for businesses and public sector bodies such as schools and charities would offer “equivalent support” to that for households, with a review in three months’ time on how it could be targeted better
But businesses across many sectors of the economy have warned for weeks that they may not survive the winter as a result of rising energy bills, with fixed-price tariffs set to end and quarterly rent bills for many at the end of the month.
Pubs and breweries are among those sounding the alarm that any delay in the government’s support package could force more businesses to close, leading to deep job losses.
Emma McClarkin, chief executive of industry body the British Beer and Pub Association, said these businesses “will not be able to wait days, let alone months, to get clarity on their energy bill”.
“Many are making decisions now about whether to close this winter,” he said.
“We need urgent clarity on whether this cap will work for businesses and help them get out of a crisis that has been brewing for months, and urge the chancellor to seriously consider what immediate reassurance it can give to thousands of business owners who are currently desperate.”
Archie Bland and Nimo Omer take you through the top stories and what they mean, free every weekday morning
Privacy Notice: Newsletters may contain information about charities, online advertisements and content funded by third parties. For more information see our Privacy Policy. We use Google reCaptcha to protect our website and Google’s Privacy Policy and Terms of Service apply.
While business support is likely to require legislation to be enacted, the spokesman said the government was “still working out exactly” whether or not this would be necessary.
However, there has been no further clarity on whether the support payments will be the same, which would be a relatively small amount for companies that have much higher bills, or higher to ensure a network is maintained of security for those companies at risk of failure. .
“At this stage I am not able to set out the exact details of the scheme,” the spokesman said when asked how the support would be equivalent.
Ministers and officials are reportedly struggling to find a mechanism to set a cap on business energy costs, with companies in complex contracts often protecting themselves from future price rises.
A “fiscal event” is expected to be held later next week detailing the full details of the energy support package, as well as Truss’ tax cut plans. However, the exact date has yet to be chosen, with the situation complicated by Truss attending the UN General Assembly in New York for most of next week and parliament having to go to the conference break.
The government is looking to shorten the recess, both at the start and end, amid concerns about inaction over the energy bill crisis, but has pledged not to encroach on Labor or Conservative party conference dates.