Liz Truss has faced calls to correct publicly her comment that households will not have to pay more than £2,500 for their energy bills this year after government intervention.
It’s less than a month since she announced the Energy Price Guarantee, designed to insulate Britons from the worst of the energy crisis caused by rising wholesale gas prices. However, Truss has already created confusion about her own policy. Here, we unpick the situation.
On 8 September, the government announced it plans to cushion the blow from rising energy bills through a revamped energy price cap. Regulator Ofgem’s price cap, which was introduced in 2019 in an attempt to protect loyal consumers from being ripped off, had been due to rise by 80% to £3,549 from 1 October, and was forecast to surpass £5,000 in January. Instead, under Truss’ policy an average annual bill will be capped at£2,500 for two years from 1 October.
During her bruising round of local BBC radio interviews on Thursday, the prime minister was repeatedly asked about household finances as the cost of living crisis squeezes budgets. She told BBC Radio Nottingham: “The biggest part of the package we announced is the support on energy bills, making sure that people across this country are not facing energy bills of more than £2,500 and that businesses can get through this winter.” On BBC Radio Kent, she said: “We have taken action by the government stepping in and making sure that nobody is paying fuel bills of more than £2,500.” She made a similar claim last weekend on CNN.
The £2,500 relates to an average bill for a typical household based on 2019 consumption figures. For those paying by direct debit and on a standard variable tariff their usage costs will be limited to 34p per
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