Energy price crisis: SNP must stop sniping from sidelines and help Tories tackle soaring cost of living – Murdo Fraser MSP
By this time next week, the UK will have a new Prime Minister putting together a fresh government. It is clear what the first item at the top of a very large in-tray for her or him will be: tackling the energy crisis which is engulfing the country.
Friday’s announcement by Ofgem of an 80 per cent increase in the energy price cap from October, whilst not altogether surprising, is nevertheless a cause of real fear and alarm for households across the country.
Most of us are left wondering how we will be able to afford to heat our homes this coming winter with bills set to rise so dramatically.
It is not just households we need to be concerned about. The price cap does not apply to businesses which have had to weather the storm of Covid restrictions for the past two years and are now facing another existential threat.
I was contacted at the weekend by a care home operator in Fife who told me that their bills for gas for the coming year are set to increase from £13,000 to a staggering £133,000, with electricity also set to rise from £23,000 to £131,000.
At that level, the care home is simply not sustainable. The doors will have to close with dreadful consequences for residents and staff. It is a tragic prospect repeated right across the country.
Even if you are able to find the cash to meet increased bills, this will come at the expense of spending on other essentials. With hundreds of pounds a month more going out to pay for electricity and heating, the weekly shop for food will become a trial. Going out? Home improvements? A new car? A holiday? Off the agenda for most of us. A dramatic recession looms.
All this is a direct consequence of Russia’s invasion of Ukraine, but that is immaterial to those fearful about what the coming months will bring. All eyes will be on the new Prime Minister and what action she or he will take to address the coming pressures on household budgets.
Already the UK Government has shown that it can act to assist those facing rising bills. With a more generous package than most people predicted, the then Chancellor Rishi Sunak provided a series of measures back in the spring to provide direct financial support to all those affected by rising bills, at a total cost of £37 billion. This package is worth more than £1200 to the least well-off households.
Whilst immensely welcome, it is now clear that this does not go far enough and much more action is needed to assist both individuals and businesses. I expect we will see very early action from a new Chancellor to address public concern.
It is not just the UK Government which needs to act here. Power companies have been generating billions in profit as a result of the rise in wholesale gas prices, and they need to play a role in supporting their customers.
I understand the calls that are being made for more punitive taxation of excessive profits, but we do need to be aware of the need to invest in the future of our energy supply, to reduce our reliance on imported gas, and our energy producers have to provide the renewable and low-carbon nuclear energy that we will need to rely on.
The Scottish Government, in typical style, has been quick to criticise Westminster and demand urgent action on energy bills, but slow to take any positive steps itself. The First Minister seems to think that embassies will make her powerful though unemptied bins will bring us rats.
This is a government which has a budget in excess of £41 billion, the highest ever in the history of devolution, both in cash and real terms (if we discount the additional Covid support last year) and rather than just sitting on the sidelines sniping about what others are doing, it needs to step up and use some of its own resources to assist those in need. The First Minister is supposed to be a leader, not just a commentator.
Let me give just two practical examples of where the SNP government has already let people down. By the start of the new school term just last week, we should have had free school meals offered to all school pupils in primary school, a measure which would have helped those families with stretched household budgets. This policy has been delayed – another broken promise from Nicola Sturgeon.
It was the same Nicola Sturgeon who back in 2017 told the SNP conference, to rapturous applause, that her government would be setting up a not-for-profit, publicly owned energy company, delivering lower bills to people across Scotland.
Five years later, that policy has long since been abandoned – well before Covid – but not before half a million pounds of taxpayers’ money was squandered on preparatory work. That is a measure which, the First Minister herself claimed, could have helped all those struggling to pay rising heating and electric bills.
We heard at the weekend that the SNP’s latest plan is to increase income tax for the better paid, who already pay substantially more on their income than those in other parts of the UK.
Only in the topsy-turvy world of SNP economics would a proposal to take more money out of people’s pockets, at a time when they are struggling to pay rising costs and the economy could be tipping towards recession, make any sense whatsoever.
I am sure that the UK Government will be stepping up to support those in need, but it cannot act alone. A little less overblown rhetoric and finger pointing from the SNP, and a little more direct financial help for those in need, would be welcomed by all.
Murdo Fraser is a Scottish Conservative MSP for Mid-Scotland and Fife
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