Fallon boost to energy industry with tax cut hint
GOVERNMENT minister Michael Fallon hinted at good news for the energy industry in the chancellor’s Budget next week, during a speech yesterday.
The energy and business minister warned that green levies are still crippling the industry and keeping consumer’s bills high. In a bid to avoid job losses, Fallon said the government would look at “other policy costs” on suppliers and manufacturers.
“Existing compensation and exemptions are not enough,” he warned. “The risk to jobs in the steel and chemical industries is now very real.
“There is a clear and present danger that we could lose jobs in these foundation industries just when we are beginning to see other jobs re-shoring to the UK.
“Without further action on energy costs the competitiveness gap between Europe and the US is becoming unbridgeable.”
The chancellor George Osborne is rumoured to be planning a freeze of the UK’s carbon price floor in his Budget statement next Wednesday. The tax on burning fossil fuels has pushed up prices for both industry and consumers and remains a key political battleground for Conservative and Labour MPs.
Last year, Labour leader Ed Miliband announced his party would freeze energy bills if he is elected in 2015.
Manufacturers group EEF has been calling for government help to reduce costs for weeks.
However, it is understood to be concerned that any freeze in the carbon price floor would be set at 2015-16 levels, which would be much higher than 2014.
Last month EEF’s chief executive Terry Scuoler warned that rising costs represent “a major threat to growth,” adding: “The UK cannot afford to pile even more unilateral costs on the manufacturing sector.”