Theresa May’s government has just cost millions of us £76 each. Not that she cares

Theresa May Budget Tax
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Theresa May’s government has announced a review into one of the most controversial aspects of modern life. But far from being beneficial to the majority of the public, the government consultation will probably end up costing millions of us money.

Promises, promises…

In May, the Conservative Party pledged an energy price cap on electricity and gas bills. Specifically, as The Canary reported, it promised that the industry regulator Ofgem would set a rate for standard variable tariffs; rates which industry watchdogs often criticise as being a bad deal for consumers. Announcing the policy in The Sun, May said:

Like millions of working families, I am fed up with rip-off energy prices. Gas and electricity bills only ever seem to go in one direction, eating up more and more of your monthly pay packet… So I am making this promise: if I am re-elected on June 8, I will take action to end this injustice by introducing a cap on unfair energy price rises.

Oh, hang on…

But the cap never made the Queen’s Speech, with the government instead opting for a cap on pre-payment meters. Effectively, the Tories shelved the policy. And since then, British Gas has announced a 12.5% increase in energy prices; meaning the average household will see their dual fuel bill increase by £76 a year. The price hike by British Gas followed another sting for customers in February, with many seeing their bills increase by up to 28%.

Hand wringing

On Sunday 6 August, the government quietly sneaked out the announcement of a review into energy prices. The Department for Business, Energy & Industrial Strategy (DBEIS) said that Professor Dieter Helm CBE will conduct a review into “ways to keep energy prices as low as possible”. It went on to say that:

Helm, one of Britain’s leading energy experts, will look specifically at how the energy industry, government and regulators can keep the cost of electricity as low as possible, while ensuring the UK meets its domestic and international climate targets.

Helm has to report back by October 2017. By that time, 3.1 million people will have been hit by the British Gas price hike.

Read on...

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May’s weasel words

Labour has criticised the government, saying that it should introduce the energy price cap it promised before the election. Labour’s Shadow Business, Energy and Industrial Strategy Secretary Rebecca Long-Bailey said:

[Customers] face a bleak winter ahead with soaring and unfair energy costs. They need action, not another review. Ofgem’s recent watered down price cap proposals went nowhere near the promise made by the Prime Minister to adopt Labour’s principle of a price cap. And last week’s energy price hikes clearly showed the government would be nowhere near implementing their election promise anytime soon.

May’s weasel words before the election have now been shown to be little more than hot air. If she had introduced her promised energy price cap, then millions of British Gas customers may not have seen such a heavy increase in costs. But with spiralling inflation [paywall] and warnings that VAT on energy may be increased to 20%, it’s looking like a bleak winter ahead for millions in the UK. Except, of course, for May and those in her government.

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