Queen’s death won’t affect energy bills freeze, No 10 insists

Emergency legislation won’t be needed – as government also confirms people on fixed tariffs will benefit automatically

No 10 has said it does not believe the mourning period for Queen Elizabeth II’s death will have any impact on Liz Truss’s new policy to stop annual household energy bills soaring past £2,500.

The prime minister’s official spokesman said on Friday that the two-year energy price guarantee will be ready for households from 1 October, as scheduled.

There had been concerns that the 10-day parliamentary recess for mourning could prevent emergency legislation needed to stop the energy price cap rising automatically to just over £3,500 on 1 October.

But a No 10 spokesman said: “We’re implementing that guarantee initially through private contracts with suppliers rather than through legislation – so this mourning period doesn’t impact that introduction.”

He added: “We’re working urgently now on the wider aspects of the policy to ensure it can be delivered. As it stands, we do not believe the mourning period would impact on delivery of the policy.”

It comes as the Department for Business, Energy and Industrial Strategy (BEIS) confirmed that people on fixed-rate tariffs would be able to benefit from the £2,500 energy price guarantee.

There had been fears that people on fixed-rate tariffs would have to cancel their deal and switch to a variable rate, after money-saving expert Martin Lewis flagged the issue.

But such fixed-rate tariff customers “do not need to take any action to get the benefits of this scheme”, a spokesperson for BEIS told the BBC on Friday.

Energy suppliers have said that they would soon be contacting customers about what the government plan will mean for their bills. E.On has made clear fixed tariff bill payers would not need to change their contract to benefit from the guarantee.

Government officials will keep on working with the energy firms to finalise the details of the plan to support both households and businesses through the cost of living crisis.

Chancellor Kwasi Kwarteng – who has yet to set out how much it will cost the government to subsidise energy suppliers for extra wholesale costs – still needs to find a date to reveal his emergency package.

It had been expected to come on 19 September. But the suspension of parliament for 10 days of mourning could run almost immediately into the recess for party conference season – leaving open the prospect that MPs may not return until 17 October.

Meanwhile, a crucial decision on whether to increase interest next week has been delayed by the Bank of England as a mark of respect for the Queen.

The Bank’s Monetary Policy Committee (MPC), due to finalise the decision on Thursday 15 September, was widely expected to hike interest rates in a bid to curb soaring inflation.

Officials said the meeting will now be held a week later instead, after the 10-day period of public mourning for monarch. The decision will now be made public on 22 September.

Ms Truss announced the strategy on Thursday in the hours before the Queen’s death. Paid for with tens of billions of pounds of borrowing, it guarantees that for two years bills for the average home will not increase past £2,500, saving typical households around £1,000.

A YouGov published after the PM’s announcement on Thursday found little enthusiasm for the plan, with just 24 per cent of people believe it provides the right amount of help. Some 3 per cent of people believe the cap provides too much help – but the majority, 56 per cent, say it is too little.

The PM also announced an immediate lifting of the fracking ban in England, despite the Tory manifesto pledging not to do so unless it was scientifically proven to be safe amid concerns over earthquakes.

The government was due to publish a British Geological Survey review into extracting shale gas on Thursday, which officials said showed more drilling is required to establish data.

But Downing Street said this will now not be published until after the mourning period, with the official spokesman saying it will come “as soon as that period has concluded”.