Tories deny seeking Big Six energy price freeze
Downing Street is on the back foot over Ed Miliband's energy price freeze policy
Andrew Grice has been Political Editor of The Independent since 1998. He was previously Political Editor of The Sunday Times, where he worked for 10 years, and he has been a Westminster-based journalist since 1982. His column, Inside Politics, appears in The Independent each Saturday.
Friday 29 November 2013
Labour claimed the Government was in “complete disarray” after energy companies suggested ministers are trying to stop them raising their charges while condemning the price freeze proposed by Ed Miliband.
Downing Street and the Treasury denied the claim but it threw the Government on to the defensive as it finalised a package to cut gas and electricity bills to be announced in George Osborne’s autumn statement on Thursday.
Ministers hope the reduction will be worth about £50 a year. But industry sources claimed that, in private talks with the “big six” energy firms, the Government sought assurances that they would not wipe out the benefit by raising their charges. Unless there was an unexpected rise in wholesale energy prices, the sources said, ministers wanted to see charges pegged until mid-2015 – after the general election in May that year. That would mean a freeze of about 18 months, very similar to the 20-month freeze offered by Mr Miliband, which the Government has dismissed as a “con.”
The Government blamed the embarrassing setback on a “misunderstanding”. They said the firms were being asked about the impact of switching some green and social levies from energy bills.
David Cameron said: “I want to help households and families by giving getting sustainably low energy prices. The only way you can do that is by increasing competition and rolling back the costs of some of the levies on people’s bills. I said that’s what we were going to do. That is what we’re going to do, and I think that’s a very positive step forward.”
He insisted: "That’s worlds away from making a vague promise on something you might do in 20 months’ time, with no idea about how you’re going to do it. That’s a con. What we’re dealing with is real policy that can make a real difference."
But Labour claimed the Government was a “shambles” because it had no defining purpose other than being in power. Mr Miliband said: “What we now know is that while David Cameron has in public been opposing an energy price freeze, in private he has been pleading with the energy companies to get him off the hook.
"This is a weak and flailing Prime Minister. What Britain needs is Labour's strong, credible plan that we're publishing today to freeze energy prices until 2017 and reform a broken energy market so it properly works for business and families."
Mr Osborne may reduce bills by introducing the Energy Companies Obligation (ECO) scheme, which provides free insulation to low income households, over four years rather than two. The warm homes discount, which cuts annual energy bills by £135 for pensioners and vulnerable groups, is likely to be funded from general taxation. He may also bring down the cost of transmitting energy.
Angela Knight, chief executive of Energy UK which represents the “big six”, said the firms only controlled about 20 per cent of the bills consumers face, with the rest down to wholesale costs and levies.
Exclusive: World’s most pristine waters are polluted by US Navy human waste
Missing Malaysia Airlines Flight MH370: Any terrorist seizure of the plane ‘would have required one hell of a piece of planning’
Croatia's second city to close 'worst zoo in the world' after reports of 'nightmare' conditions and 'depressed' animals
Missing Malaysia Airlines Flight MH370: Hijackers, pirates or suicide – the theories surrounding the mystery
Oscar Pistorius trial: Photographs of Paralympian splattered in blood after Reeva Steenkamp shooting shown in court
Katie Hopkins continues campaign to become Britain's most hated talking head with poorly timed Bob Crow tweet
No EU referendum under Labour: Ed Miliband to reveal that vote on membership is ‘unlikely’ in next Parliament if party wins power
Grace Dent: Who cares if she spells it Barraco Barner? Gemma Worrall is more employable than some bookish arts graduate
The rise of Ukip: Study warns Labour that Eurosceptic party's electoral base now 'more working class than any of the main parties'
Europeans have ‘got whiter’ due to natural selection in past 5,000 years, scientists say
Fracking is turning the US into a bigger oil producer than Saudi Arabia
- 1 Is your name now 'banned' in Saudi Arabia?
- 2 Exclusive: World’s most pristine waters are polluted by US Navy human waste
- 3 Nemanja Matic interview: My family were in tears when we left Lisbon
- 4 Missing Malaysia Airlines Flight MH370: Jet ‘hijacking’ began soon after take-off
- 5 'Missing Malaysia Airlines Flight MH370 plane found in Bermuda Triangle!' Facebook links are profiting hackers
£50000 - £60000 per annum: Charter Selection: This well respected and exciting...
£40000 - £50000 per annum: Charter Selection: This exciting company and market...
£40000 - £60000 per annum + EXCELLENT SALARY: Austen Lloyd: Senior Private Cli...
£25,000 to £35,000: IT Connections Ltd: Signal Processing Engineer / Acoustics...