Carmichael calls for energy price hike to be scrapped to avert ‘cataclysmic’ hit to family finances

Orkney and Shetland MP Alistair Carmichael.

Alistair Carmichael has called for the UK government to block to latest energy price hike to avert a “cataclysmic hit to family finances”.

The Orkney and Shetland MP commented after yesterday’s (Friday) announcement that regulator Ofgem would be again lifting the energy price cap in October.

It means the typical household energy bill will reach £3,549 a year – up 80 per cent on the current cap.

Fuel poverty is already a huge concern in Shetland, with CAB reporting a massive increase in demand from families seeking help with costs. 

Even before Ofgem’s announcement, Scottish health secretary Humza Yousaf told The Shetland Times that with people having to choose between “heating and eating” the cost of living crisis was set to become a public health emergency this winter.

Mr Carmichael has urged the government to adopt the Liberal Democrats’ plan to block the price rise – and meet the costs by expanding the windfall tax on oil and gas profits, and VAT revenues.

“The new figure for the price cap is roughly what had been predicted in recent days but it still represents a massive shock to the system and to families already struggling with their bills,” he said.

“A near-£1600 increase – not far off doubling the cap – will put the median household into fuel poverty across this country. That is a cataclysmic hit to family finances and the government must respond.

“It is unconscionable that there is not a single minister out on the airwaves this morning to talk about the price cap rise.

“This is an entire government skipping school because they forgot to do their homework. People across the UK are crying out for some leadership and they are not getting it from the Conservatives.

“Life does not go on hold just because the Tories are having an internal bun fight. The only response that meets the scale of the challenge would be to follow the Liberal Democrat plan of stopping the price rise before it happens

“That is no small feat but we need bold action now to give families reassurance and stability going into the winter. We cannot wait any longer.”

Energy prices have risen sharply in recent months, fuelled in part by the war in Ukraine.

But with the Conservative party engaged in a leadership contest, Mr Carmichael said the government’s response to the crisis has largely been put on hold.

Chancellor Nadhim Zahawi said he knew the energy announcement will be causing “stress and worry” but that support was on its way.

He highlighted the second instalment of the £650 cost of living payment for vulnerable households, extra help for pensioners and those with disabilities, and the £400 energy bills discount.

“In the face of rising energy prices, driven by Putin’s brutal and illegal war in Ukraine, we must work together in a spirit of unity,” he said. 

“That is why I have sat down individually with some of the UKs largest energy companies this week to make sure that we are doing all we can to help people and I’ve been working flat out to make sure that the new prime minister can deliver support to those who need it most, as soon as possible.”