Lib Dems propose legislation to freeze energy bills

The energy price cap is due to rise 80% in October

Lib Dem leader Sir Ed Davey said his party will put forward a bill in Parliament aimed at freezing energy bills (Andrew Matthews/PA) (PA Wire)

The Liberal Democrats said they will propose legislation this week which would freeze energy bills by preventing the price cap rise due in October.

Party leader Sir Ed Davey accused the frontrunner in the Tory leadership election, Liz Truss, of “leaving people worried sick” by her “refusal to come clean on her plans” on how to support households with soaring energy bills.

The energy price cap is due to rise 80% in October, after the regulator, Ofgem, said the average household’s yearly bill can be raised from £1,971 to £3,549.

The Lib Dems said they would present a bill to Parliament this week that would prohibit Ofgem from increasing the cap above its current level.

The country is facing a social catastrophe the likes of which we’ve not seen in decades

Lib Dem leader Sir Ed Davey

The bill, which the party said could be presented on Tuesday, would also call on the Government to provide funding to energy providers to cover the cost shortfall, which would be paid for in part through expanding and backdating the windfall tax on oil and gas producers, the party said.

And proposals would see small businesses helped with their costs by providing grants worth 80% of their expected energy bill increase.

The Lib Dems said the measure could be funded by cancelling proposed tax cuts for banks.

Presentation bills are introduced without debate in the House of Commons, and the Liberal Democrats are unlikely to be able to force a vote on it in the immediate future.

Labour is pushing for a six-month freeze on energy bills at the current £1,971 price cap, also funded in part by expanding the windfall tax on oil and gas profits.

Ms Truss, who is tipped to take over as prime minister on Tuesday if she wins the Conservative leadership election against her rival Rishi Sunak, was asked about the idea of freezing energy bills on BBC’s Sunday with Laura Kuenssberg programme.

Ms Truss said: “I’m not going to go into details of what a putative announcement would be before, because I think it would be wrong to do that.”

The leadership hopeful said that if she wins and takes over as prime minister she will make an announcement “within one week” about how “we are going to deal with the issue of energy bills and of long-term supply”.

Ms Truss was pressed several times during the interview to say what kind of support she intends to provide if elected, but the Foreign Secretary would not be drawn.

“Before you have been elected as prime minister, you don’t have all the wherewithal to get the things done.

“So, this is why it will take a week to sort out the precise plans and make sure we are able to announce them,” she said.

But the Lib Dem leader said Ms Truss is refusing to “come clean” on her plans.

Sir Ed said: “The country is facing a social catastrophe the likes of which we’ve not seen in decades.

“Liz Truss’ refusal to come clean on her plans is leaving people worried sick about how they will afford to heat their homes this winter.

“Liberal Democrats have drafted a bill to freeze energy bills, which could be brought in on day one by the new prime minister.

“Liz Truss or Rishi Sunak must make it their first act to cancel this eye-watering energy price rise, to save millions of families from being plunged into poverty.”