Tories Cost The Working person £1000s In Energy Bills

Labour has accused the Conservatives of costing British households nearly £1,000 in extra energy costs over the past seven years by failing to stop electricity and gas firms raising prices.

While the government is now imposing an energy price cap, the opposition attacked what it said was a record of inaction by successive Tory governments.

The government defended its record, saying a freeze on prices as energy companies faced growing costs in recent years would have damaged investment and businesses.

Rebecca Long-Bailey, shadow business secretary, said: “The government has been promising action on energy bills since 2010 yet energy costs are still spiralling.”

In 2010, a household with typical energy consumption paid £1,038 for an annual dual fuel bill. In 2017 it was £1,116, but in some years it has been more than £1,200.

Adding up the annual amount consumers have paid above the 2010 level, the total cost to an average household is £957, figures compiled by the House of Commons library show.

Labour said this extra cost could have been avoided if the Conservatives had intervened earlier to stop suppliers raising prices.

The result was big six profits had continued to thrive, leaving around 2.5m households in fuel poverty, the party said. Labour’s proposed price cap would keep typical bills below £1,000, lower than the £1,050 that some analysts expect the government’s price cap to come in at

“The next Labour government will radically reform our broken energy market, creating publicly owned, locally accountable energy companies and co-operatives to rival existing private energy suppliers,” Long-Bailey said.

The government responded by pointing out that Ofgem had referred the energy market to the competition watchdog four years ago, and had since taken steps to put in place a price cap.

A spokesperson for the Department for Business, Energy and Industrial Strategy said: “Energy prices have gone up and down since 2010, driven by external factors including wholesale and network costs, and policies that have led to investment in networks, energy efficiency and low-carbon generation.

“Freezing energy prices would have meant a lack of important investment in infrastructure and would have damaged businesses when market-driven costs went up.”

The analysis assumed that energy use has remained constant when in reality it has been falling over the past seven years due to more efficient products. The real amount consumers have paid due to tariff increases is therefore likely to be lower than £957.

Ministers took the decision to move ahead with a cap last autumn after a series of price rises by the big six across 2017. The companies blamed the increases on a variety of reasons including rising wholesale prices and government policy costs.

Analysts have warned that another round of price rises is imminent. E.ON was criticised last week for announcing a backdoor way of increasing energy bills for a million customers.

The legislation underpinning the government’s price cap passed its second reading in the Houses of Commons on Tuesday, and a committee of MPs will take evidence on the draft law from experts next week.

If the cap comes into force by the year’s end, as hoped, it will not stop prices going up periodically, but will put a ceiling on the amount suppliers can charge consumers.