Millions of people would not be able to cope, charities said. Even those on low or middle incomes who had some savings could see them completely wiped out. It was a full-blown national crisis, though long foreseen. Consumer champion Martin Lewis tore through central London giving breathless interview after breathless interview, starting on BBC Radio 4’s Today program at 7.30am. Lewis appeared at 11 separate stores before 2 p.m. But while Lewis was everywhere and Labour’s shadow ministers were stacking up unopposed, the government was nowhere to be found. Where was Energy Secretary Greg Hunts, news producers asked? Or perhaps another minister of the crown? Is Prime Minister Boris Johnson back from his second summer holiday or the chancellor for at least another week, Nadeem Zahawi? Hours earlier Hands, whose responsibilities include retail energy markets, tweeted that it was “great to visit the Los Alamos National Laboratory here in New Mexico,” where he had “useful discussions” about nuclear fusion. When asked, mid-morning, if Hands was back in his office, officials at the Department for Business, Energy and Industrial Strategy at first appeared unaware. He was then said to be traveling to Indonesia for a G20 meeting. This despite the fact that he had been spotted late in the morning at his departmental office between flights, clearly with no time at all to entertain media offers. In the absence of the government, the Joseph Rowntree Foundation (JRF) has released its own analysis showing that energy bills would exceed many people’s incomes to the point where paying them would become a “fantasy”. It was, JRF made clear, terrifying. “In all my years, I’ve never worked so hard on an analysis like this because it’s so shocking, it seems wrong,” said Peter Matejic, the institute’s chief analyst. Greg Hunts, the energy secretary, was one of those absent from the public eye after the price cap was announced. Photo: Michał Wachucik/PA “It is impossible to think that a care worker or a shop assistant will have to struggle to come up with hundreds of extra pounds to pay for their heating, or that their total income for a whole year will be less than their energy bill. But that is what this evidence suggests will happen if significant further steps are not taken quickly.” However, the growing sense of national anxiety that Matejic shared with millions will not be addressed or alleviated for some time yet by anyone running the country. There are still eight days left before the name of the next prime minister is announced. Then, when Liz Truss or Rishi Sunak are in No 10, the date for the emergency budget needs to be set, the options discussed and, finally, options made. The events of Friday morning reinforced the sense that the six-week Tory leadership contest has not only left a void at the heart of power, but that it has taken place in a world some distance from reality. Not only has the left-wing government’s search for a new Conservative leader and prime minister effectively stalled (initially the cabinet agreed not to make major economic decisions until it was over, despite the cost-of-living crisis), but the candidates’ desire to play on what what they believe to be the views of the tiny Tory ‘electorate’ has made it impossible to formulate realistic policy. Truss, the hot favorite, has spent weeks committing to potentially inflationary tax-cut pledges while vowing to avoid the “handouts” that everyone now knows are inevitable if they are to get the help they need with their energy. accounts. Both candidates have also leaned away from green solutions to the energy crisis. At several hustings Truss has won applause from Tory MPs by rejecting solar power. But reality is coming. Economists and MPs see the danger and say something has to give. Paul Johnson, director of the Institute for Fiscal Studies, said Truss should walk away from some of what he was saying. He said: “It is certain that he will have to make significant donations and he has committed to significant tax cuts. This will clearly be many tens of billions in additional borrowing, which will pose risks to the long-term stability of public finances and potentially to the short-term outlook for inflation or interest rates.” All governments are struggling to find solutions. But there is a sense of urgency in the EU that has been lacking in the UK. European governments are scrambling to find ways to protect households and businesses, and the Czech Republic, which holds the rotating EU presidency, is weighing calling an emergency energy summit to discuss price caps across the bloc. Many countries have already taken action. Spain has capped gas prices for a year, halved VAT on energy bills and cut another tax on electricity to 0.5%, and is taxing power companies more, shifting the money to needy customers. Italy this month approved a new energy aid package worth 17 billion euros, on top of the 35 billion euros earmarked since January for cost-of-living subsidies, and also aims to tax companies that benefit from higher energy prices. People with a low income receive an additional 200 euros. France forced state electricity company EDF to limit wholesale price increases to 4% for a year and cut its tax on electricity consumption from €22.50 per megawatt hour to €1 for households and €0.50 for businesses. Further individual assistance is decided upon. Germany introduced several energy-saving measures last week: temperatures in public buildings will be limited to 19 degrees Celsius from September and heating will be turned off in public areas such as corridors. The private sector is encouraged to follow suit. In the last couple of days Truss has said she will provide help whenever needed but will need a turnaround before she even becomes Prime Minister. David Gauke, the former Tory Chancellor of the Exchequer, said he believed he would have to announce some face-saving tax cuts, but that they would not be anywhere near enough help. In fact, he believes that after six weeks of saying one thing he will have to do another, raising more questions about Tory leadership contests in times of crisis. “He’s trying right now to present what he’s going to do as very conservative, whereas I suspect what he’s going to end up doing is something that has at its heart a very substantial intrusive, pamphlet measure, which is not the kind of policy he wants he does, but I can’t see that he has any choice.”
