SNP demands 'real freeze' on energy bills in Kwasi Kwarteng's maiden fiscal statement

The SNP has urged Chancellor Kwasi Kwarteng to introduce a “real freeze” on energy bills when he unveils his mini-budget today, arguing that the previously announced energy price guarantee does not go far enough.

Prime Minister Liz Truss set out plans to freeze household bills at an average of £2,500 a year on the day the Queen’s death was announced. This week Kwarteng announced that similar measures would be put in place to help businesses.

SNP shadow chancellor Alison Thewliss has called on the UK Government to go further to help consumers, pointing out that freezing bills at £2,500 includes a rise from current levels and takes average bills to double where they were at this time last year.

The Westminster package includes a £400 discount on all household energy bills, but Thewliss said bills should be frozen at today's prices rather than being allowed to rise first while additional targeted support should be provided to low- and middle-income families.

She has also called on the government to reconsider its decision not to introduce a windfall tax on energy company profits so its support package does not have to be funded via borrowing.

"The UK already had the highest levels of poverty and inequality in north west Europe before energy prices started to rise, and millions of families were already struggling to get by under the damaging policies of Westminster control,” Thewliss said.

"Today, the Chancellor must U-turn on unacceptable Tory plans to raise the energy price cap yet again to £2,500, and instead introduce a real freeze on bills as part of a comprehensive package of support for families and small businesses.

"Instead of wasting billions of pounds of taxpayers' money in tax breaks for the rich and big business, the UK Government must focus on ordinary families, with targeted support for low- and middle-income households and small businesses.”

The detail of what households and businesses will receive under the energy scheme was announced earlier this week, but Kwarteng is expected to outline estimates of what it will cost when he delivers his fiscal statement – his first as chancellor – this morning.

It has already been trailed that the scheme will be funded via borrowing rather than increased taxes, with Kwarteng widely expected to announce freezes and cuts rather than increases to rates of corporation and income tax.

Like Thewliss, Scottish Liberal Democrat leader Alex Cole-Hamilton has called on the government to fund the energy price guarantee through increased taxes on oil and gas companies so that “future generations” of taxpayers do not foot the bill.

“The government should be imposing a windfall tax on the obscene profits of global oil and gas giants, rather than making our children and grandchildren pay by increasing borrowing,” he said.

“Just like Boris Johnson before them, the new prime minister and chancellor are hopelessly out of touch.”

Kwarteng is also expected to provide details of planned reforms to the welfare system, having said that around 120,000 more benefit claimants will be ordered to “take active steps to seek more and better paid work or face having their benefits reduced”.

The aim is to have people on benefits fill the 1.2 million jobs the Treasury says are currently vacant across the UK. Kwarteng said claimants will be sanctioned if they do not “fulfil their job-search commitments without good reason” when the changes come into effect in January.

“Our jobs market is remarkably resilient, but it is not perfect. While unemployment is at is at its lowest rate for nearly 50 years, the high number of vacancies that still exist and inactivity in the labour market is limiting economic growth,” he said.

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“We must get Britain working again. These gradual changes focus on getting people back into work and maximising the hours people take on to help grow the economy and raise living standards for all.

“It’s a win-win. It boosts incomes for families and helps businesses get the domestic workers they need, all while supporting economic growth.”

The Chancellor will deliver his statement in the Commons at 9.30am.