- Energy bills remain a top business concern, as many face a drastic reduction in their support
- Energy market for businesses must be reformed to protect firms and correct market failures
- Firms are facing a further financial squeeze, with corporation tax, living wage and business rates all changing from April 1st
As businesses face an 85% decrease in energy support from tomorrow, the British Chambers of Commerce (BCC) has highlighted the need for an energy support contingency plan, and is calling for increased, targeted help for firms who desperately need it.
The BCC is also calling on Government to increase Ofgem’s power to strengthen protection for businesses in the energy market.
Alex Veitch, Director of Policy & Public Affairs at the British Chambers of Commerce, said:
“We have been signalling for months that many businesses will struggle to afford their energy bills when financial assistance reduces by 85%, with many receiving a fraction of their original support. Almost half (47%) of firms say paying bills will be difficult from tomorrow onwards.
“But of the seven energy policies we advocated for the Government to include in this month’s Spring Budget, not one was acted upon.
“Flexibility to increase support for those who desperately need it – ignored. Easing the burden of claiming VAT on energy – ignored. Funding for improved business energy efficiency – ignored. And so the list goes on.
“Government also failed to heed our calls to increase regulation of the business energy sector. The energy crisis faced by firms and households are two sides of the same coin. Yet, non-domestic customers do not enjoy the same protection as households.
“To ensure competition in the business energy sector, and solve market failures, Government must ensure Ofgem has the necessary powers to properly regulate the industry. We are also asking Ofgem and Government to introduce a ‘duty to supply’ mechanism to the non-domestic energy market, to ensure businesses can access fixed rates, providing them with certainty and stability.
“Along with the reduction in energy support, businesses are facing several other changes in the business environment from tomorrow. Corporation tax is increasing, as is the national living wage, while a number of firms will see their business rates change due to revaluations.
“These changes will have a significant impact, but Government is yet to offer any meaningful support to offset the challenges currently facing so many UK businesses.”