Earl Russell
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Electricity Bills: VAT Removal
Earl Russell Excerpts(6 days, 17 hours ago)
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Lord Wilson of Sedgefield (Lab)
The priority of this Government is the cost of living. We want to bring the cost of living down to give people breathing space over the coming years. The OBR stated that we were due to spend £1.8 billion over the next three years on digital ID, funded from within existing settlements through reprioritisation. We are still going to find that money from within existing budgets through reprioritisation, but we will now use it for other things. The amount of money is relatively small when you consider that the last Government, as my noble friend Lord Livermore would say, left this Government with a £22 billion black hole.
Earl Russell (LD)
My Lords, may I take a moment to welcome the noble Baroness, Lady Curran, and thank the outgoing noble Lord, Lord Whitehead? We look forward to his continuing contributions. We support this measure. As a day-one action, it is welcome—it will save about £40 off a typical fuel bill for about six months—but as a policy lever of government, it is costly and ineffective. What further action will the new Administration take to remove policy costs from electricity bills to help support further energy market reforms? They are the real policy levers we need so that we can make progress on reducing bills and continuing the energy transition.
Lord Wilson of Sedgefield (Lab)
I echo the noble Earl’s comments about my noble friends Lady Curran and Lord Whitehead. I worked closely with them both. The issue of future help for the energy market et cetera is something we will have to wait for until we do the Budget next year. In the meantime, we will continue to help people with the cost of living. I want to point out the measures we have taken that will help people in the short term: we have frozen rail fares, cut energy bills by £150, cut VAT on electricity bills to zero and we are cutting business rates for 32,000 small venues, pubs and clubs. Obviously, that is not a silver bullet, but the intent is there to do everything we can to help people who are suffering.