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Kwasi Kwarteng has insisted there is “absolutely no question of the lights going out” this winter, as he said the government will not be bailing out failed energy companies due to the escalating price of gas.
Seeking to allay fears after crisis talks with the industry, the business secretary also dismissed “alarmist, unhelpful and completely misguided” suggestions of three-day working week or people being unable to heat homes.
Insisting Britain had “sufficient capacity”, he also told MPs the energy price cap, would remain in place, saying: “It’s staying – it’s not going anywhere”.
His remarks came after No 10 said the government was “confident of the security of supply” and was not a cause for “immediate concern” when asked whether the country faced a “winter of discontent”.
Wholesale prices have spiked 250 per cent since the start of 2021 leading to calls for support from some in the energy industry and the collapse of some smaller firms.
But Mr Kwarteng insisted the government will “not be bailing out failed companies”, adding: “There will be no rewards for failure or mismanagement.
“The taxpayer should not be expected to prop up companies which have poor business models and are not resilient to fluctuations in price.”
However, with rising bills, and an imminent cut to universal credit for some of the lowest income families in the UK, the government is also facing further calls to re-think the decision to end the £20-per-week uplift.
Ed Miliband, the shadow business secretary, warned some families faced a “triple whammy” of fuel costs, the cutting of universal credit and the manifesto-busting decision earlier this month to hike national insurance tax.
“I want to make two points extremely clear,” Mr Kwarteng added in his statement. “Firstly I must stress that protecting consumers is our number one, our primary focus and will shape our entire approach to this important issue.
“Secondly, I also want to reassure the House that while the UK like other countries in Europe has been affected by global prices, Britain benefits from having a diverse range of gas supply sources.
“We have sufficient capacity, and more than sufficient capacity to meet demand and we do not expect supply emergencies to occur this winter.”
“There is absolutely no question of the lights going out or people being unable to heat their homes. There will be no three-day working weeks or a throw back to the 1970s – such thinking is alarmist, unhelpful and completely misguided,” he said.
The cabinet minister added that as economies re-open across the globe following the Covid-19 pandemic, “we are seeing a dramatic uptick in global gas demand” and “much faster” than anticipated.
Mr Kwarteng also told MPs he would making a joint statement later on Monday with the energy watchdog, Ofgem – a move that prompted criticism from the Commons speaker, Sir Lindsay Hoyle.
“If you want to make a statement afterwards, I’m hoping you’ve got it covered by someone making it at the same time [in the Commons],” the speaker said.“
This House deserves its respect. People here on all sides are elected, elected to hear from you to be told here first. Not second hand by the media. It’s not right, it’s not acceptable – we’re going to have to get this right.”