Government announces six-month energy support scheme for businesses

Businesses are to receive an initial six months of support from the government to help combat rising energy costs.

Household energy bills will be capped at £2,500 a year for two years from October through a new Energy Price Guarantee which will limit the price suppliers can charge consumers for units of gas. Businesses will receive "equivalent support", but only for six months.

After this period, Prime Minister Liz Truss said government will introduce targeted measures for vulnerable industries such as hospitality.

Truss said the business secretary will work with businesses on a review to determine where these will be targeted to ensure those “most in need” get support. The review will be completed within three months.

Further details of the support plan have yet to be announced.

UKHospitality chief executive Kate Nicholls tweeted that it was a “positive plan” to start tackling price rises but said businesses could not wait for three months to find out if further support was available.

Nicholls wrote: “Positive plan to start tackling cost of doing business and energy crisis. Really welcome recognition of need for immediate action on commercial energy bills and further support needed to industries like hospitality most at risk - VAT and rate relief quick and effective cash injection.

“But, businesses cannot wait for three months to find out what support is planned nor can they wait until the end of the price freeze to receive it - without urgent details who and how it will be targeted, many hospitality biz will be forced to take difficult decisions.

“We look forward to working closely with the new business secretary on plans to support hospitality recovery to give businesses headroom to survive, return to growth and positive contribution in so many local communities.”

Earlier today almost 300 hospitality companies wrote to the government calling for more support including a cut in VAT and a freeze in business rates.