United Kingdom: Liz Truss announces the freezing of energy prices for individuals

Two days after receiving the keys to Downing Street, Liz Truss unveils this Thursday a massive aid package for British households and businesses, hit by soaring inflation and energy prices.

The new Prime Minister of the United Kingdom has announced a two-year energy price freeze for individuals, at 2,500 pounds (over 2,800 euros) a year for an average household, in the face of soaring energy costs. life.

The long-awaited measure corresponds to a saving of around 1,000 pounds a year compared to the price increases which were expected on October 1, said Ms Truss, who was speaking before Parliament and also announced that prices would be frozen. energy for six months for businesses.

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Among other measures, the new Prime Minister also announced a review by the end of 2022 of the country's trajectory towards the 2050 carbon neutrality objective, to ensure that it is achieved "in a business-friendly way". and growth”.

Ms. Truss, who claims to remain "completely committed" to this objective of carbon neutrality, also announced to British MPs the lifting of a moratorium on hydraulic fracturing in the country.

A cost of 150 billion pounds

These measures were not quantified on Thursday but will cost tens of billions of pounds, financed by borrowing.

According to several media, the addition would amount to 150 billion pounds.

That's more than the £70bn spent on paying the wages of furloughed workers throughout the pandemic.

“It's a time to be bold.

We are facing an energy crisis (…) and these interventions will have a cost”, justified the leader in Parliament.

Pressure was mounting for the government to halt soaring energy bills and the cost of living crisis, with economists, NGOs, unions and even energy companies warning of a humanitarian disaster this winter.

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The United Kingdom is very dependent on gas prices, which have increased sevenfold over one year, in particular because of supply tensions since the start of the war in Ukraine.

The wholesale prices of electricity and gas were hitherto entirely passed on to businesses and households, despite the aid granted by the previous government, which quickly proved to be very insufficient.

Thursday's announcements notably come on top of a £400 reduction in bills for individuals that had already been announced by the previous executive.