Business
Why high energy bills look like they are here to stay
In the long-term, the government and Ofgem wants to shift the country away from our reliance on gas, with its volatile international pricing.
Expect lots of fanfare over the sale, for the first time in the UK, of plug-in solar panels.
In the short-term ministers – and the new prime minister – say they are helping where they can, and promising that there is “more to do”.
VAT will be cut on electricity bills in October. It means the price of electricity will fall, but that’s been more than outstripped by an 8% rise in the price of gas.
In the last Budget, then-Chancellor Rachel Reeves cut some so-called policy costs and shifted some onto general taxation instead.
Ministers may be tempted to do more of that, but could face be criticised for simply shifting the burden off bills and onto taxes.
So, the options are limited. The new chancellor, John Healey, has choices to make – with lots of calls for help but with limited room for manoeuvre in the public finances.
All eyes will be on his first Budget, which comes soon after those higher autumn energy bills kick in.
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