London Daily

Focus on the big picture.
Friday, Aug 01, 2025

Liz Truss’s energy costs package lacks important details

Liz Truss’s energy costs package lacks important details

Prime minister bows to political and moral pressure with £150bn state effort –but how it will be financed still unclear

There are two main things to note about Liz Truss’s energy costs package. First, there is much detail to come. Also, it is an undeniable paradox that the first move of a prime minister surrounded by former Taxpayers’ Alliance staff is a £150bn state effort to fix commercial prices.

Much like Boris Johnson would never have wanted to be the prime minister to curtail people’s liberties more severely than anyone since wartime, it is fair to say Truss would rather not have begun her tenure in No 10 with what is known as the energy price guarantee.

One of the defining elements of Truss’s successful campaign to succeed Johnson was her repeated talk of tax cuts and suspending green levies as the primary way of helping people with soaring bills.

An early Truss campaign interview with the Financial Times even airily dismissed the idea of “handouts”. Future campaign messaging was less clear, but still resistant to what was disparagingly referred to as “Gordon Brown economics”.

As it has turned out, Truss has ended up more or less with what Brown argued for in early August: a call for a freeze on prices that pre-empted not just the government but even Brown’s Labour party.

What changed was the sheer weight of political and, what you might even term, moral pressure.

Truss was told by an array of experts that failing to take bold action would create a humanitarian disaster, with millions of households cold or hungry or both, businesses collapsing en masse, with the impact on the economy, and especially on public health inequalities, felt for a generation.

One effect of the sheer one-sidedness of the argument is that it made Truss’s decision to U-turn (whatever her aides might argue, it is a U-turn, even a gradual one) politically easier.

Responding to Truss’s statement in the Commons, Keir Starmer noted the change of stance, but made much more of Truss’s refusal to extend a windfall tax on energy firms’ unexpectedly high profits to part finance it.

It is another political paradox that Truss is not only committing about the same as the annual NHS England budget on price controls, she is doing so with little apparent plan to pay for it, beyond borrowing. An extended windfall tax would arguably have only contributed a bit, but its absence is notable, and could become a millstone for the government.

It is not only the financing that remains opaque. A lot of the mechanism for the domestic help is barely sketched out, not least how ministers will help people outside the mainstream energy market, such as those who use heating oil or people living in flats with communal energy sources that fall outside the price cap.

The plans for businesses are, so far, little more than a broad commitment: a sixth-month scheme will offer “equivalent support”, to be made more targeted after that.

There is a final political lesson from Truss’s statement, and that is that the climate emergency sceptics have much more sway in government than before, with the restoration of fracking and a commitment to 100 or more new North Sea drilling projects.

Officially, Truss remains committed to the UK’s net zero target by 2050, but her announcement of a review into how this can be met in a way that is “pro-business and pro-growth” tells another story – even if that review is led by the green-inclined Tory MP Chris Skidmore.

Time, again, will tell how much the public side with Starmer, who told MPs that “doubling down on fossil fuels is a ludicrous answer to a fossil fuel crisis”. But fracking, at least, has been repeatedly shown to be unpopular with the public.

There is, of course, one final and entirely exterior factor. With the Queen gravely ill, all of this might get forgotten amid a long period of national mourning.

Newsletter

Related Articles

0:00
0:00
Close
Trump Administration Finalizes Broad Tariff Increases on Global Trade Partners
J.K. Rowling Limits Public Engagements Citing Safety Fears
JD.com Launches €2.2 Billion Bid for German Electronics Retailer Ceconomy
Azerbaijan Proceeds with Plan to Legalise Casinos on Artificial Islands
Former Judge Charged After Drunk Driving Crash Kills Comedian in Brazil
Jeff Bezos hasn’t paid a dollar in taxes for decades. He makes billions and pays $0 in taxes, LEGALLY
China Increases Use of Exit Bans Amid Rising U.S. Tensions
IMF Upgrades Global Growth Forecast as Weaker Dollar Supports Outlook
Procter & Gamble to Raise U.S. Prices to Offset One‑Billion‑Dollar Tariff Cost
House Republicans Move to Defund OECD Over Global Tax Dispute
Botswana Seeks Controlling Stake in De Beers as Anglo American Prepares Exit
Trump Administration Proposes Repeal of Obama‑Era Endangerment Finding, Dismantling Regulatory Basis for CO₂ Emissions Limits
France Opens Criminal Investigation into X Over Algorithm Manipulation Allegations
A family has been arrested in the UK for displaying the British flag
Mel Gibson refuses to work with Robert De Niro, saying, "Keep that woke clown away from me."
Trump Steamrolls EU in Landmark Trade Win: US–EU Trade Deal Imposes 15% Tariff on European Imports
ChatGPT CEO Sam Altman says people share personal info with ChatGPT but don’t know chats can be used as court evidence in legal cases.
The British propaganda channel BBC News lies again.
Deputy attorney general's second day of meeting with Ghislaine Maxwell has concluded
Controversial March in Switzerland Features Men Dressed in Nazi Uniforms
Politics is a good business: Barack Obama’s Reported Net Worth Growth, 1990–2025
Thai Civilian Death Toll Rises to 12 in Cambodian Cross-Border Attacks
TSUNAMI: Trump Just Crossed the Rubicon—And There’s No Turning Back
Over 120 Criminal Cases Dismissed in Boston Amid Public Defender Shortage
UN's Top Court Declares Environmental Protection a Legal Obligation Under International Law
"Crazy Thing": OpenAI's Sam Altman Warns Of AI Voice Fraud Crisis In Banking
The Podcaster Who Accidentally Revealed He Earns Over $10 Million a Year
Trump Announces $550 Billion Japanese Investment and New Trade Agreements with Indonesia and the Philippines
US Treasury Secretary Calls for Institutional Review of Federal Reserve Amid AI‑Driven Growth Expectations
UK Government Considers Dropping Demand for Apple Encryption Backdoor
Severe Flooding in South Korea Claims Lives Amid Ongoing Rescue Operations
Japanese Man Discovers Family Connection Through DNA Testing After Decades of Separation
Russia Signals Openness to Ukraine Peace Talks Amid Escalating Drone Warfare
Switzerland Implements Ban on Mammography Screening
Japanese Prime Minister Vows to Stay After Coalition Loses Upper House Majority
Pogacar Extends Dominance with Stage Fifteen Triumph at Tour de France
CEO Resigns Amid Controversy Over Relationship with HR Executive
Man Dies After Being Pulled Into MRI Machine Due to Metal Chain in New York Clinic
NVIDIA Achieves $4 Trillion Valuation Amid AI Demand
US Revokes Visas of Brazilian Corrupted Judges Amid Fake Bolsonaro Investigation
U.S. Congress Approves Rescissions Act Cutting Federal Funding for NPR and PBS
North Korea Restricts Foreign Tourist Access to New Seaside Resort
Brazil's Supreme Court Imposes Radical Restrictions on Former President Bolsonaro
Centrist Criticism of von der Leyen Resurfaces as she Survives EU Confidence Vote
Judge Criticizes DOJ Over Secrecy in Dropping Charges Against Gang Leader
Apple Closes $16.5 Billion Tax Dispute With Ireland
Von der Leyen Faces Setback Over €2 Trillion EU Budget Proposal
UK and Germany Collaborate on Global Military Equipment Sales
Trump Plans Over 10% Tariffs on African and Caribbean Nations
Flying Taxi CEO Reclaims Billionaire Status After Stock Surge
×