Sir Keir Starmer has promised people won’t “pay a penny more” on their winter energy bills as he prepares to unveil Labour’s plan to ease the cost of living crisis.
Ahead of a full disclosure on Monday, says the Ap leader the party’s £29 billion energy plan will save the typical family £1,000 immediately, bring energy costs under control for the future and help tackle inflation.
The party says this would be achieved by preventing the energy ceiling from rising this winter, which is paid for an additional tax from oil and gas giants.
The price cap, which is the maximum that businesses in England, Wales and Scotland can charge an average customer for energy costs, should remain at £1,971.
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Energy analysts have predicted that typical energy bills could rise to around £3,500 in October and more than £4,200 in January.
And a new report suggests energy bills are set to cost more than two months of the average take-home pay next year unless the government intervenes.
The plans in Labour’s “emergency package” include:
• Freezing the price ceiling, which the party says will reduce inflation by 4%
• Support for customers who are not protected by the price cap
• Equalization of prices for people on prepaid meters and those who pay bills monthly
• To close a loophole in the state’s energy gains tax
• A pledge to use the already pledged £14 billion in non-targeted funding to prevent bills from rising
• Insulating 19 million are coming across the country over the next decade to reduce energy needs and reduce bills
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Labor has said its energy plans are fully costed and will be paid for by removing “a huge tax loophole” in windfall tax announced by then Chancellor Rishi Sunak earlier this year.
The party says new investment allowances within the policy mean that for every £1 invested, 91.25p will go back to businesses in further tax relief – despite oil and gas producers announcing big profits.
Labor says removing these new investment allowances and backdating the start date to when the party called for a windfall tax in January would raise £8bn, which could ease household living costs.
The party has also detailed a plan for sustainable energy and security, including doubling the UK’s offshore wind capacity, investing in solar, tidal and hydrogen, and promoting new nuclear capacity.
Sir Keir said Labour’s plan “would solve the problems immediately and for the future”, as he warned Britain’s cost of living crisis was “getting worse”.
“We’ve had 12 years of a Tory government that has failed to prepare and refused to invest, leaving bills higher and our country less safe,” he added.
“This is a national emergency. It needs strong leadership and urgent action.”
Timid Starmer goes big on the cost of living crisis
It is a reflection of the power vacuum at the top of British politics that it is the Labor leader who has come under the most pressure to produce a plan for rising energy prices – and not the prime minister, who appears to be on his second holiday in as many. weeks.
After criticism for being too coy about ways to tackle the cost of living crisis, Keir Starmer has gone big.
He proposes a seismic intervention that would freeze the energy price cap, protecting customers by shifting the financial burden back to the energy giants.
It will no doubt play well with those preparing for huge increases in energy costs in the coming months.
And with many charities warning that the most vulnerable simply won’t make it this winter.
It will probably be less enthusiastically received by Liz Truss and Rishi Sunak.
Conservative leadership hopefuls have been under pressure to say how they will help those facing hardship, and will now be expected to explain why a freeze on energy price caps is not an option.
In the coming days, this could shape the campaign – and be the moment when the Labor leader finally makes the impact his critics have been calling for.
The Liberal Democrats called earlier this week for the energy cap to be scrapped entirely.
The Government has announced that households will receive £400 to help pay fuel bills this autumn, but Boris Johnson admitted on Friday that the current plans do not go far enough.
The prime minister also repeated his insistence that it is up to his successor to “make significant fiscal decisions” after talks with energy chiefs ended with no new measures to ease the cost of living crisis.
Johnson’s successor will not be announced until September 5.
How Britain’s skyrocketing bills will become a matter of life and death
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Tory leadership hopes Sunak has unveiled a plan to cut rising energy bills for up to 16 million vulnerable peoplewhich he hopes will propel him to 10 Downing Street.
The ex-chancellor has also said he will pass laws to make Britain “energy independent” by 2045, putting in place immediate support for households – especially the most vulnerable – facing skyrocketing energy bills.
Rival Liz Truss has said cutting taxes is the best way to help with living costs over the winter.
But the foreign minister has rejected demands for an unexpected tax on oil and gas companies’ profits.