Non-domestic Energy Support

Caroline Lucas Excerpts

Monday 9th January 2023 Commons Chamber

[James Cartlidge]

The hon. Gentleman is right about the need to be swift. I have responded to a number of Members by referring to the letter to Ofgem that the Chancellor was sending today, asking it to produce an urgent update, before the Budget, on the review of the non-domestic energy market, because of all the stories we are hearing from colleagues about the way in which some non-domestic providers are behaving. I will ensure that the letter can be found on gov.uk. It must be said that there are many excellent providers in the market, but it is less regulated than the domestic side, so I think it important for Ofgem to consider these many points. I should also say to the hon. Gentleman that there have been some recent changes in the cost of connecting to the grid, and I am happy to write to him with further details about that.

[Caroline Lucas (Brighton, Pavilion) (Green)]

I appreciate that balances must be struck, but I think that small businesses, including many in my constituency, will have listened to this announcement with deepening anxiety. Research from the Federation of Small Businesses suggests that one in four small businesses are expected to close, downsize or radically change their business models when the Government reduce energy support. Obviously, that research was conducted before we knew the shape of this proposal, and it is much less supportive than the FSB and others hoped.

Let us be clear: this decision poses an existential threat to small businesses, many of which think that, in a sense, they are being left vulnerable to wholesale energy price hikes while the Government wash their hands and walk away. Will the Minister look at it again, and, in particular, will he look at other ways of supporting small businesses with the multiple challenges that they face, for example by suspending covid loan debt repayments so that they have some hope of surviving this year?

[James Cartlidge]

I understand why colleagues are concerned when they receive correspondence, whether it involves the FSB acting at a national level or individual businesses in their constituencies. These have been incredibly challenging times. I ran a business before I came to the House, and I went through the credit crunch, which was unbelievably stressful. We were a mortgage company, and mortgages disappeared on a far greater scale than they did some months ago. It is good to see them returning, and with lower rates in recent days.

Let me say to the hon. Lady, however, that this remains generous support. It is not as generous as it might be—I have been clear about that—but it will still be significant for businesses. Let me also stress a point that I made in an earlier answer. If we go back to the beginning of the EBRS and then up to the end of the discount scheme in April 2024, we see that there are 18 months in which businesses can adapt. I know that it is not easy, but significant funds are available to support efficiency. I think that, in circumstances such as these, all of us—people who run charities or businesses, and Ministers —must look at what more we can do to run our operations more efficiently in the face of huge changes in energy prices.