Energy Bills: Govt Gives £50 Savings Breakdown

Written By Unknown on Senin, 02 Desember 2013 | 16.12

The Government says it has outlined how it will cut household energy bills by £50 - as Ed Miliband prepares to dismiss the plan as "smoke and mirrors".

The Labour leader will insist in a speech today that the "cosy deal" reached with the 'big six' power firms will still see bills going up this winter, saying ministers do not "get" the cost-of-living crisis.

Chancellor George Osborne will announce full details of how the Government will achieve its pledge of reducing energy bills by £50 a year in his Autumn Statement on Thursday.

But a breakdown has been released in advance of that speech, which says £12 of the figure will come in the form of a government rebate.

A reduction of between £30 and £35 will be achieved through cutting green levies, ministers say, while voluntary action by energy companies to cut network costs will mean a one-off £5 saving.

Ed Miliband Mr Miliband wants a 'real price freeze'

Some of the large energy companies released statements in the wake of the Government's announcement, detailing how they would contribute to savings.

The energy issue has dominated the political agenda since Mr Miliband promised to freeze prices for 20 months if he wins the next general election.

Mr Miliband is due to launch his attack when addressing staff at the VW National Training Centre in Milton Keynes.

"A lot of people think that David Cameron and George Osborne are trying to catch up with One Nation Labour on the cost-of-living crisis: from pay-day lending to energy bills," he will say.

"But the truth is they are struggling to catch up with the British people who live at the sharp end of an economy where the link between the wealth of our nation and family finances has been broken. That is the cost-of-living crisis that is happening in our country today."

Mr Miliband will say the Autumn Statement should feature "a real price freeze and action to reset the market to stop them overcharging again in the future".

George Osborne Mr Osborne will reveal the full details of the plan on Thursday

He will add: "It's right that the debate in Britain is now about the cost-of-living crisis. Political leaders need to understand the new challenges our country faces. That is the test of this Government this week. All the signs are that they simply don't get it."

But Mr Osborne has insisted that families will benefit from the plan.

He told BBC's Andrew Marr Show: "There is going to be an average of £50 off people's bills. We are absolutely insistent that this is going to be brought in."

Mr Cameron and Nick Clegg confirmed on Sunday the plan to reduce the burden on consumers by cutting the green taxes, which add £112 to each bill.

The cost of the Energy Company Obligation Scheme, which funds energy efficiency measures for low-income households and makes up the vast majority of the environmental levies, will be halved under the plan.

Around £12 of the £50 savings to bills will come from a reworking of the Warm Home Discount in a £300m deal. The remainder will come by switching the funding for energy measures to general taxation.

A £1,000 grant for energy efficiency measures for anyone buying a new home, which will be funded by a fresh crackdown on tax avoiders, will be included in the plan.


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