The business secretary will outline support on Wednesday for companies, charities and public sector organizations for six months from October 1, after Liz Truss said they would get equivalent help to households whose costs have been capped. Rees-Mogg is expected to cut electricity and gas rates for non-residential users by around 50% and 25% respectively, compared to current winter contracts, in a plan first reported by Bloomberg and confirmed by government officials sources. But the cap may not be enough to prevent permanent scarring of Britain’s high streets, as pubs, shops and schools looking to sign up to new electricity contracts have been hit with prices up to 10 times their current prices. The Federation of Small Businesses (FSB) said that without significant intervention, the UK faces a “lost generation” of traders, adding that a cap would not affect the high charges levied by suppliers. Larger businesses also raise concerns. On Tuesday, pub group Fuller’s said its annual electricity bill was likely to jump from £8m to £18m, warning that the increases facing the hospitality industry were “unsustainable”. Some Labor and even Conservative MPs are understood to be disappointed that Rees-Mogg will not announce the plans on Wednesday in the House of Commons. It means there will be no opportunity to be questioned about support in the chamber because parliamentary business is conducted by oath to King Charles III. Details of the scheme emerged as Truss confirmed pubs will get help with their energy bills for more than six months, but many other vulnerable businesses and public services will have to wait until the winter to find out if they are eligible for longer-term support. Ahead of the government’s announcement on energy help for businesses, Truss said pubs were one of the types of businesses that would be vulnerable enough to receive support in the long term. He said vulnerable businesses would be told in another three months if they were eligible for longer-term support beyond the next six months, but singled out pubs as a group of businesses likely to qualify. Others – including schools and charities as well as small shops and traders – will have to wait. In an interview from the UN General Assembly in New York, the prime minister said: “The most I can say is that for businesses that are vulnerable, that don’t have the means to … invest in their own energy supply, they will we are providing support for the long term. “This includes businesses such as pubs. The business secretary is carrying out a review of exactly which businesses will be included – this review will be completed within three months. I can assure people who own pubs that they are exactly the kind of businesses that will get this long-term support.” Truss has previously faced criticism for failing to detail how businesses would be helped, beyond providing equivalent help to consumers. Household energy bills will be capped at £2,500 a year on average from October. Energy suppliers have also expressed concerns that the government may let them decide how to pass on state support to troubled businesses. Executives are understood to have told officials they would face a backlash if they were asked to decide how best to provide financial support to businesses to deal with rising energy bills. As Truss announced the freeze, the government said it would “launch a new scheme for all non-domestic customers who would otherwise be at the mercy of high prices due to Russia’s illegal war in Ukraine”. He noted that “the majority of UK non-domestic customers are on fixed price energy deals”. Archie Bland and Nimo Omer take you to the top stories and what they mean, free every weekday morning Privacy Notice: Newsletters may contain information about charities, online advertising and content sponsored by external parties. For more information, see our Privacy Policy. We use Google reCaptcha to protect our website and Google’s Privacy Policy and Terms of Service apply. It was expected that the scheme would offer businesses a fixed price for a unit of energy and that suppliers would receive a subsidy to cover the difference between this and the wholesale price. However, there are concerns that suppliers may be required to ensure that businesses actually need the support. Some companies will have bought their power in advance at relatively low prices, protecting them from rising bills. One supplier said: “There’s a huge amount of complexity here when you look across the board, from heavy industrial users to small businesses. There is an option to reduce the energy unit rate, but then there is the question of whether all companies will get this support, if some have bought their power years ago. “We don’t want to be the referees. We can never win in this scenario. It has to be universal, otherwise there is always the possibility that businesses will fall into mistakes.” Another major energy supplier said: “The government wants to give money and then we will figure out how to spend it. We are not going to make those decisions. “We are also concerned about the firms that are gaming the system – selling their valuable hedge contracts to other firms and then taking the support as well.” Under the plan, which is expected to be announced, suppliers will be able to impose their own fees on top of that and will be reimbursed for the wholesale price cap by the government. This would be around 21p per kilowatt hour for electricity and 7.5p per kWh for natural gas. There would be a different cap for those paying variable rates. Government sources said this was the most likely model and scale of supporting energy bills for businesses, without saying how much the overall package would cost the Treasury. Craig Beaumont, the FSB’s head of external affairs, said: “If the government wants a fixed wholesale price, tomorrow we have to figure out how it will be implemented in practice on small businesses’ energy bills. A small business should be told by their supplier, quickly, what their new account will be. “However, there may be no regulation of the other important element of small business energy bills – the fixed charge. “While consumers will have a cap on fixed charges, small businesses will not, and this means that energy providers could continue to increase fixed charges, and therefore mean that small businesses see their energy bills rise range”.
