Nicola Sturgeon warns a third of Scottish households face ‘extreme fuel poverty’

Nicola Sturgeon has warned almost a third of Scottish households face living in “extreme fuel poverty” by October as she announced an emergency budget review to help combat the growing cost-of-living crisis.

The First Minister called for an immediate doubling of the direct financial support provided by the UK Government and said the energy cap price rises shouldn’t go ahead.

She said there would “undoubtedly” be loss of life unless urgent action was taken.

It came as Boris Johnson urged electricity companies to act “in the national interest”.

Prime Minister Boris Johnson urged energy companies to act in the "national interest".

Following roundtable talks in Downing Street, the Prime Minister said the Government would continue to work with the sector, but failed to announce any new measures.

Ms Sturgeon accused the UK Government of being “missing in action” on the issue.

After chairing a meeting of the emergency Scottish Government resilience committee, she said the crisis was on a similar scale to the pandemic.

She said: “In the absence of substantial and urgent action, this emergency will cause acute deprivation and suffering. It will affect access to practical necessities for millions of people across the UK. Bluntly, it will cost lives.

“To illustrate the severity of the situation, the Scottish Government estimates that, even with current UK Government mitigations, at least 700,000 households in Scotland – 30 per cent of all households – will be living in extreme fuel poverty by October.

"That number could be even higher, if the Ofgem price cap for October 2022 is above £2,800.”

Ms Sturgeon said the necessary powers and resources lay with the UK Government, but added: “At the same time, the Scottish Government will continue to do everything within our resources and powers to help those most affected.”

The Scottish Government said it would undertake “an emergency budget review to assess any and all opportunities to redirect additional resources to those most in need, reduce the burdens on business and stimulate the Scottish economy”.

Among other measures, it also called for the urgent introduction of an energy price cap for smaller businesses and support to prevent closures, as well as a further windfall tax “to ensure nationalisation of the profits being made out of the current pressures”.

Earlier, UK Chancellor Nadhim Zahawi insisted ministers were continuing to monitor the “extraordinary profits” some companies were making, but Mr Johnson made clear any “significant fiscal decisions” would be for his successor.

The Prime Minister stressed that in the face of Russia’s illegal invasion of Ukraine, which is driving prices to record levels, it is important the energy sector works with the Government “in the national interest”.

Officials said he made clear in talks that it is vital the Western world continues to stand by the Ukrainian people in their fight for survival.

Mr Johnson said in a statement: “Following our meeting today, we will keep urging the electricity sector to continue working on ways we can ease the cost-of-living pressures and to invest further and faster in British energy security.”

Mr Zahawi added: “In the spirit of national unity, they agreed to work with us to do more to help the people who most need it.”

The crisis meeting was called amid a dire new warning that annual energy bills could top £5,000 by the spring.

Analyst Auxilione said regulator Ofgem could be forced to raise the price cap for the average UK household to £5,038 from next April.

While the talks – which were also attended by business secretary Kwasi Kwarteng – had been billed in advance, the Prime Minister’s presence had not been announced beforehand.

The Treasury said the discussions had focused on how the Government and industry could collectively drive forward reforms to ensure the market worked better for consumers.

Officials said ministers had made clear that it was not always functioning in the interests of consumers and the “extraordinarily high bills” would ultimately damage the companies themselves.

At the same time they emphasised the need for continued investment in domestic energy sources – including North Sea oil and gas, renewables, biomass and nuclear – to strengthen UK energy security.

Mr Zahawi said the Government was continuing to evaluate the “appropriate and proportionate steps to take” in the face of the “extraordinary profits” being racked up by some in the sector.

Speaking as she visited the Lowson Memorial Church’s breakfast club in Forfar, Angus, Ms Sturgeon said she agreed with many of the proposals made by former prime minister Gordon Brown in an intervention earlier this week.

Mr Brown told the Guardian the Government should “pause any further increase in the cap” on bills, and negotiate lower rates with each individual energy company after examining their balance sheets.

He also suggested ministers should temporarily nationalise any providers that go bust.

Ms Sturgeon said: “I stand ready as First Minister to work with the UK Government, but they are missing in action right now while people suffer and suffer in an increasingly severe way.”

The SNP leader said “we perhaps need to hear more from Keir Starmer as well” on action that could be taken at Westminster.

After cancelling the energy bill price cap, she said the UK Government should examine the “root causes” of price rises.

Following the Downing Street roundtable meeting, Liberal Democrat leader Sir Ed Davey condemned the failure of ministers to come forward with new support.

He said: “It is appalling that the Conservatives still haven’t announced any extra support for families and pensioners facing the hardest winter in decades.

“The cruellest element of this chaos is that those who could actually help, [Liz] Truss and [Rishi] Sunak, are more interested in speaking to their party than taking the action our country needs.

“That is why the Liberal Democrats are calling on the Government to cancel the energy price hike to avoid a country-wide catastrophe.”

Ed Miliband, Labour’s climate change and net zero shadow secretary, added: “Britain faces a national emergency with rising energy bills and a cost-of-living crisis.

“Families are worried about how they will pay their bills. But instead of showing leadership, the Conservatives are missing in action.

"The Prime Minister and Chancellor have gone AWOL, whilst the candidates for the leadership have no substantive ideas about how to help working people meet the challenges they face.

“Labour will take the action that’s needed to get us through this crisis, with real action to bring down energy bills for families, and build a stronger economy for our country.”

Earlier this week, Ms Sturgeon wrote to Mr Johnson calling for a meeting of the UK’s heads of government council to be brought forward.