May admits energy bills could still rise despite cap pledge

Prime Minister Theresa MayPrime Minister Theresa May
Prime Minister Theresa May
Theresa May has admitted that electricity and gas bills could still go up under a energy price cap scheme proposed by Conservatives.

Tories say the price limit could save 17 million families £100 a year, but energy bosses warned the Tory price cap could undermine competition.

And price comparison site said it was a “red herring” which would “kill competition, push up energy prices and leave consumers worse off”.

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Mrs May was challenged on the scheme by a worker at a factory in Leeds, who demanded to know whether it would stop prices from rising.

She responded: “I don’t think any government can ever promise that no bill is going to go up year on year... It will be making sure that there are not these sudden and unexpected and significant hikes in prices.”

Mrs May denied she was resurrecting an Labour policy derided as “Marxist” by David Cameron when it was put forward by Ed Miliband in 2015. Unlike Mr Miliband’s freeze, which would stop prices falling, her plan would see an independent regulator set maximum prices, reflecting market conditions.

Lawrence Slade, chief executive of Energy UK, said Mrs May’s announcement “effectively risks giving up on competition at a time when we need engaged consumers more than ever”. Energy giant E-ON said it was “concerned” the policy was being “made for political reasons”.

The SNP’s Callum McCaig said the policy was “a screeching U-turn” and an admission of “complete failure in government to make the energy market work”.