Energy bills – latest: Cost of support for businesses ‘could be up to £48bn’

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Good morning, and welcome to The Independent’s live coverage of UK politics, as the government prepares to announce a package of support for businesses facing huge energy bill increases.

Millions of businesses across Britain are set to have their energy bills capped for six months from as early as October.

Unlike the cap for household bills, which will last two years, the scheme for businesses will initially be limited to six months.

However during a visit to New York, Liz Truss told reporters on Tuesday that some some “vulnerable” businesses, such as pubs, will be offeredd longer-term support.

Hospitality groups wrote to chancellor Kwasi Kwarteng on Tuesday, warning that the failure to provide enough detail could cause some businesses to collapse.

Our Whitehall editor Kate Devlin and political correspondent Adam Forrest have more details here:

Businesses will welcome an intervention by the government, but must be given clarity on how the energy crisis support will work, a business leader has said.

Kitty Ussher, the chief economist at the Institute of Directors, told BBC Newsnight: “It is essential to have the details because businesses obviously have to be able to plan for the future, not just the next few months but the next few years.

“If they are unable to have the clarity there is hardly any point making the announcement in the first place.”

The energy support packages for households and businesses are “something of almost a panic reaction,” the director of the Institute for Fiscal Studies has said.

Speaking as the government prepares to release details of a major support package for businesses facing soaring energy bills, Paul Johnson told the BBC’s Today show: “I think something like this was inevitable.

“Some businesses were seeing their energy bills going up by five times – or certainly that was likely to happen from October. Just as households were going to need some protection, so were businesses.

“I think one of the positive things about the business announcement is that they appear to be looking at reviewing this and coming back with something more targeted in six months’ time.

“I rather wish they had done the same for households because for households and for businesses this is something of almost a panic reaction.

“You have got to do something and the only thing that they can do immediately is protect everybody, whereas in the medium term if this goes on we really want something that is more targeted.”

The support package from Jacob Rees-Mogg’s department is “going to have to be huge” to save the high street – and the Conservative government, a Tory MP has warned.

While one senior Tory MP said that businesses “have to be able to see the cavalry coming over the hill”, another told The Independent that the support package “is going to have to be enough to save the high street and save consumers and businesses.

“It is going to have to be huge,” he said, adding: “If it is, it also might just save the Conservative government.”

The government’s new energy bills support “must not result in a cliff-edge after six months”, a business chief has said.

Tina McKenzie of the Federation of Small Businesses (FSB) told The Independent: “Energy help must not result in a cliff-edge after six months.”

She also warned there are “no such things as ‘vulnerable sectors’ and ‘non-vulnerable sectors’ when it comes to these energy hikes”.

Michael Kill, chief executive of Night Time Industries Association, which has warned that seven in 10 pubs will close this winter without an urgent rescue package, said: “Without a very clear understanding of how this works, many will go over the edge in the next couple of months.”

Our Whitehall editor Kate Devlin and political correspondent Adam Forrest have the full report:

The government is reportedly planning to cut stamp duty in a mini-budget later this week as Liz Truss attempts to drive growth.

The plans set to be unveiled by chancellor Kwasi Kwarteng on Friday are said to be aimed at stimulate further growth in the property market and helping more young people buy their first home.

Whitehall sources told The Times that stamp duty cuts were the “rabbit” in the mini-budget, and government officials had been working on the plans for more than a month.

But former Lib Dem leader Tim Farron warned the move would make the housing crisis “even worse” in his Cumbria constituency, by giving “an extra incentive for people to buy homes they don’t need, pushing them even further out of reach for those who do need them”.

My colleague Tom Batchelor has more details:

A day after US president Joe Biden attacked “trickle-down economics” ahead of his meeting with Liz Truss, a UK government minister has insisted that tax-cutting policies will help everyone.

Gillian Keegan said on Wednesday morning that the government did not “believe” Mr Biden’s comments were based on the UK economy, but instead on domestic opposition he faces in the US, and insisted there was “no way you could describe our approach as ‘trickle-down’.

Asked how letting bankers have bigger bonuses helps people struggling to pay their bills, the Foreign Office minister told BBC Breakfast: “It does help everybody to be pro-growth and pro-business.

“Of course, the packages that we have there are just exactly for those situations that you have described – people who are concerned, people who are, you know, looking at the rising cost and thinking how are they going to manage. That’s why we’ve put this considerable package in place already to freeze bills and there’s also additional support that was already in place beyond that as well for certain groups.”

She added: “We can’t just sit there and, you know, just leave it there, because we do have to look at what’s next and how we get our economy moving again.”

Joe Biden lashed out at “trickle-down economics” yesterday, ahead of a meeting with Liz Truss at the UN summit in New York.

In a message on Twitter ahead of the talks, Mr Biden said: “I am sick and tired of trickle-down economics. It has never worked. We’re building an economy from the bottom up and middle out.”

It came as Ms Truss told reporters atop the Empire State Building that her own tax-cutting plans will initially benefit the rich more than the rest of Britain – insisting that economic growth would “benefit everybody” in the long run.

Our political correspondent Adam Forrest has the report here: