Andy Burnham’s first Labour Party Conference speech promised cheaper energy, but do businesses currently feeling the squeeze have time to wait?
- Burnham pledged to bring energy costs in line with neighbouring countries within ten years, with a publicly owned Great British Grid to help get there.
- The BCC and CBI both want more detail on the Grid, and warned that state control shouldn’t be the default answer to poor utility performance.
- VAT on electricity is being scrapped from this week, which the BCC said will help the very smallest businesses.
Andy Burnham has used his first Labour Party Conference speech as prime minister to promise cheaper energy for British businesses. The catch: it could take up to ten years.
He also announced the launch of the Great British Grid, a publicly owned company that will compete with private-sector operators. Business groups have welcomed the focus on energy costs, yet for small businesses already struggling with high bills, a decade is a long time to wait.
With few details published so far, the 28 October Budget is the next real chance to see what’s on the table. But for now, here’s what the speech means for small firms, and what you can do about your bills in the meantime.
Energy bills will be lowered, but there’s a wait time
The clearest pledge for business in Andy Burnham’s speech was about energy costs.
Burnham addressed that high energy costs are one of the biggest barriers to growth, with British businesses and bill payers paying some of the highest prices in Europe – driven by a mix of soaring grid prices and the conflict in Iran.
His promise is to bring down costs in line with neighbouring countries within ten years. To achieve this mission, he announced the creation of the Great British Grid, a publicly owned company that will compete with private-sector operators.
The major caveat is the timeline. With everyone from restaurants to office spaces facing high bills today, the British Chambers of Commerce points out a decade-long target will do little to address immediate concerns, and is calling for more detail on the new public body.
There is one nearer-term change. VAT on electricity is being scrapped from this week, which the BCC said will benefit consumers and the very smallest businesses. For anyone bigger, the 28 October Budget is the next chance for relief.
Business groups raise concerns about increasing public control
Burnham also confirmed a strengthened Water Bill, which will repeal the ban on public ownership of water companies.
He said it will begin a ten-year shift towards a different system, with mayors given new powers over water companies and the option of taking back control from those that repeatedly fail.
However, some business groups have urged caution. The BCC warned that state control shouldn’t be the default answer to poor utility performance, saying firms need certainty, and the CBI said public investment in the Great British Grid should crowd in private capital, not push it out.
Their opponents argue, however, that the volatile prices and infrastructure failings, which have become the norm in Britain, are a direct result of years of fragmented private ownership. Either way, on Burnham’s current timeline, it seems like small businesses are going to be waiting for a while for a final answer.
Ultimately, while the speech offered some breadcrumbs of optimism, the BCC stressed that the 28 October Budget will be the “critical test”, and that it must cut costs and unlock growth. Until then, small businesses are left waiting to see what relief, if any, arrives.
While the long-term reforms take shape, there are steps you can take now to keep energy costs under control:
- Check your contract end date – If you let a fixed-term energy contract lapse, you can be moved onto a more expensive default rate.
- Compare suppliers regularly – Use a comparison service or get quotes directly from suppliers to ensure you’re getting the best deal possible.
- Submit regular meter readings – Estimated bills can overstate what you owe. Regular readings, or a smart meter, help you pay for what you actually use.
