Lib Dem Leader Sir Ed Davey has urged ministers to scrap April’s planned rise in the energy price guarantee and cut bills, instead.
Sir Ed warned the new price hikes will be a “hammer blow” to families and businesses, arguing action is needed now to save people from a “cost-of-living cliff edge”.
Average bills are expected to rise from £2,500 to £3,000 if the cap is amended.
But the Liberal Democrats would scrap the hike and reduce the average energy bill to £1,971 – the level it was last April.
They would fund the move with their windfall tax plan and by imposing a one-off “bonanza bonus” tax on oil and gas bosses making millions from energy bills, similar to the bankers’ bonus tax in 2009-10.
According to the party, this would save the average household an estimated £400 on their energy bills over the next 12 months.
For the least well-off households, the Liberal Democrats would also introduce extra targeted support, including doubling the Warm Homes Discount to £300.
Sir Ed said: “The Conservatives’ plan to hike energy bills in April will come as a hammer blow to families already struggling with soaring mortgages and rents, shopping bills and tax rises.
“With no plan to deal with this cost of living crisis for people or businesses, this chaotic, out-of-touch Government is instead making it much worse because they just don’t get it.”
The Conservatives’ plan to hike energy bills in April will come as a hammer blow to families already struggling with soaring mortgages and rents, shopping bills and tax rises.— Sir Ed Davey
He insisted Rishi Sunak “must act now to save families from a cost-of-living cliff edge, by cutting energy bills instead of increasing them”.
Sir Ed added: “If there’s no extra energy help for businesses, it will be more than salad and vegetables in short supply as firms, as well as farms, are forced to close.
“To add insult to injury, it’s just obscene that Rishi Sunak is happy for energy bosses to rake in millions of pounds in bonanza bonuses, while families struggle to put food on the table or heat their homes.
“People deserve a fair deal – with a large cut to their energy bills, paid for by a proper windfall tax and a one-off levy on the bonuses of oil and gas bosses.”
The party also called on the Government to perform a U-turn on its plans to reduce energy bill support for businesses, schools and hospitals by 85%, and instead extend current levels of support for another six months.
They said their plan would mostly be funded through money already budgeted for energy support, but now unspent due to falling energy prices.
The additional funds would be raised by a windfall tax on the record profits of oil and gas companies, including removing the fossil fuel investment loophole and raising the rate of the windfall tax from 35% to 40%.
This, they said, could raise at least £15 billion more than the Government’s current Energy Profits Levy.
