London Daily

Focus on the big picture.
Thursday, Sep 04, 2025

Labour calls for emergency budget as energy cap set to top £3,500

Labour calls for emergency budget as energy cap set to top £3,500

Ofgem announcement will ‘strike fear’ into hearts, says Rachel Reeves, amid accusations of profiteering at oil and gas firms

The energy regulator is set to approve a record increase in household bills on Friday as pressure mounts for an emergency budget to tackle the cost of living crisis.

The industry price cap, which sets the maximum rate suppliers can charge, is expected to top £3,500 a year from October for the average dual-fuel tariff, an increase of more than £1,500 from April.

The Ofgem announcement, which Labour said would “strike fear” into hearts across the country, will lend new urgency for calls on government to step in to expand on the £15bn package to tackle rising household costs announced in May.

Wholesale gas prices have risen even further since then and touched new records on Thursday, signalling little respite in the relentless rise in energy prices. Experts have predicted that average annual bills could top £5,000 from January with rising power prices pushing inflation up past 18% next year.

Stark data showed that Britons have already fretted over bills this summer despite low energy usage compared with the winter peak. A YouGov poll showed about 40% of 1,700 adults surveyed have struggled with food and energy bills over the past three months. Around three-quarters of those polled said the government is doing too little to help those struggling with the recent rise in the cost of living, including two-thirds of Conservative voters.

The shadow chancellor, Rachel Reeves, said: “The only people resisting measures to help people are the government. We wanted parliament to be recalled ahead of the [Ofgem] announcement but that did not happen.

“We want an emergency budget. We want the government to say what they are going to do. This announcement is going to strike fear into the hearts of families up and down the country. Urgent action is needed. Everyone has come up with plans for action apart from Liz Truss and Rishi Sunak – the two people who can actually do something about it – who have been silent.”

Despite warnings that two-thirds of households, or about 45 million people, will have been pushed into fuel poverty by January, the two contenders to replace Boris Johnson as prime minister and leader of the Conservative party have so far declined to set out any significant new measures to shield the most vulnerable families. Sunak has promised to scrap VAT on energy bills and an as yet uncosted increase in help for households on benefits, while Liz Truss has pledged assistance “across the board” for companies and households. Both Truss and Sunak have ruled out a freeze on the energy price cap. Labour leader Keir Starmer has laid out a £29bn to freeze the cap funded, in part by a beefed-up £8bn windfall tax on energy company profits.

The outsized profits enjoyed by oil and gas companies since Russia’s invasion of Ukraine were underscored on Thursday when the North Sea’s biggest oil and gas producer announced a 12-fold rise in profits. Harbour Energy said half-year earnings had reached $1.5bn (£1.3bn). Harbour said it would hand an extra $200m to shareholders on the back of the bumper revenues. Eye-watering profits at large oil and gas producers since the war have sparked accusations of profiteering by and led in May to Sunak introducing a windfall tax.

The union Unite said major energy suppliers, distributors and generators had made a combined £15.8bn in profits in the past year. Unite general secretary Sharon Graham claimed “rampant corporate profiteering is at the very heart of soaring energy bills”.

Fuel poverty charity National Energy Action (NEA) estimated that the cap’s rise above £3,000 would push the number of UK households in fuel poverty from 6.5m to 8.5m.

Adam Scorer, chief executive of the NEA, said: “The scale of harm caused by these price rises needs to sink in. A warm home this winter will be a pipe dream for millions as they are priced out of a decent and healthy quality of life.

“Even with a mild winter, millions are facing a big freeze. Action is needed now to prevent the bleakest of winters.”

Don’t Pay, the campaign group attempting to organise a mass non-payment of bills this autumn, said Ofgem’s announcement would lead to millions of people “facing either a mountain of debt or a death sentence this weekend”.

Alex, a Levenshulme resident who signed up to the Don’t Pay campaign, said: “We’ve been left with no other choice but refusing to pay. This bill hike is going to hit people like a sledgehammer – meaning many millions are facing either a mountain of debt or even a death sentence this winter.

“The tragedy of the situation is that it doesn’t have to be this way – and other countries are showing that these monstrous energy bill hikes aren’t inevitable.”

In Poland, households can now apply to purchase coal, the country’s biggest heat source, using a government subsidy while Spanish citizens have seen gas canister prices fixed until next year. Italians have received a €200 (£168) “cost of living bonus”.

Graham Duxbury, chief executive of the charity Groundwork, which attempts to reduce poverty, said: “What we need is simpler, more stable funding models so that we can help those worst off to make best use of the help they’re getting and preserve as much warmth as they can this winter, but also help those who are being pitched into fuel poverty for the first time to make the practical and behavioural changes needed to minimise their bills.”

Environmental campaigners have said the government should redouble efforts to improve the energy efficiency of homes in light of the energy crisis. Mike Childs, head of policy at Friends of the Earth, said: “A nationwide, street-by-street home insulation programme, focusing on those most in need, would slash energy use, reduce climate-changing pollution and could cut energy bills by £1,000 or more each year.”

Newsletter

Related Articles

0:00
0:00
Close
Putin Celebrates ‘Unprecedentedly High’ Ties with China as Gazprom Seals Power of Siberia-2 Deal
China Unveils New Weapons in Grand Military Parade as Xi Hosts Putin and Kim
Queen Camilla’s Teenage Courage: Fended Off Attempted Assault on London Train, New Biography Reveals
Scottish Brothers Set Record in Historic Pacific Row
Rapper Cardi B Cleared of Liability in Los Angeles Civil Assault Trial
Google Avoids Break-Up in U.S. Antitrust Case as Stocks Rise
Couple celebrates 80th wedding anniversary at assisted living facility in Lancaster
Information Warfare in the Age of AI: How Language Models Become Targets and Tools
The White House on LinkedIn Has Changed Their Profile Picture to Donald Trump
"Insulted the Prophet Muhammad": Woman Burned Alive by Angry Mob in Niger State, Nigeria
Trump Responds to Death Rumors – Announces 'Missile City'
Court of Appeal Allows Asylum Seekers to Remain at Essex Hotel Amid Local Tax Boycott Threats
Germany in Turmoil: Ukrainian Teenage Girl Pushed to Death by Illegal Iraqi Migrant
United Krack down on human rights: Graham Linehan Arrested at Heathrow Over Three X Posts, Hospitalised, Released on Bail with Posting Ban
Asian and Middle Eastern Investors Avoid US Markets
Ray Dalio Warns of US Shift to Autocracy
Eurozone Inflation Rises to 2.1% in August
Russia and China Sign New Gas Pipeline Deal
China's Robotics Industry Fuels Export Surge
Suntory Chairman Resigns After Police Probe
Gold Price Hits New All-Time Record
Von der Leyen's Plane Hit by Suspected Russian GPS Interference in an Incident Believed to Be Caused by Russia or by Pro-Peace or by Anti-Corruption European Activists
UK Fintechs Explore Buying US Banks
Greece Suspends 5% of Schools as Birth Rate Drops
Apollo to Launch $5 Billion Sports Investment Vehicle
Bolsonaro Trial Nears Close Amid US-Brazil Tension
European Banks Push for Lower Cross-Border Barriers
Poland's Offshore Wind Sector Attracts Investors
Nvidia Reveals: Two Mystery Customers Account for About 40% of Revenue
Woody Allen: "I Would Be Happy to Direct Trump Again in a Film"
Pickles are the latest craze among Generation Z in the United States.
Deadline Day Delivers Record £125m Isak Move and Donnarumma to City
Nestlé Removes CEO Laurent Freixe Following Undisclosed Relationship with Subordinate
Giuliani Seriously Injured in Accident – Trump to Award Him the Presidential Medal of Freedom
EU is getting aggressive: Four AfD Candidates Die Unexpectedly Ahead of North Rhine-Westphalia Local Elections
Lula and Putin Hold Strategic BRICS Discussions Ahead of Trump–Putin Summit
WhatsApp is rolling out a feature that looks a lot like Telegram.
Investigations Reveal Rise in ‘Sex-for-Rent’ Listings Across Canada Exploiting Vulnerable Tenants
Chinese and Indian Leaders Pursue Amity Amid Global Shifts
European Union Plans for Ukraine Deployment
ECB Warns Against Inflation Complacency
Concerns Over North Cyprus Casino Development
Shipping Companies Look Beyond Chinese Finance
Rural Exodus Fueling European Wildfires
China Hosts Major Security Meeting
Chinese Police Successfully Recover Family's Savings from Livestream Purchases
Germany Marks a Decade Since Migrant Wave with Divisions, Success Stories, and Political Shifts
Liverpool Defeat Arsenal 1–0 with Szoboszlai Free-Kick to Stay Top of Premier League
Prince Harry and King Charles to Meet in First Reunion After 20 Months
Chinese Stock Market Rally Fueled by Domestic Investors
×