Mark Drakeford has criticised new Prime Minister Liz Truss and claimed her plan to tackle energy costs "does nothing to help families" deal with other soaring costs. The First Minister made a statement on Thursday after Ms Truss, who became Prime Minister on Tuesday, announced a major support package which replaces the energy price cap with an "energy price guarantee" effectively freezing the price cap for an average home at £2,500 – or around £200 a month.
The plan -– worth between £100bn and £150bn – will "offer equivalent support” to businesses, schools, hospitals, other public organisations, and charities and will be financed through borrowing. Mr Drakeford said Ms Truss' announcement "does provide certainty for families and businesses in the short term" and that he welcomed "anything that provides that certainty and whatever relief that will bring to households and businesses faced with the prospects of even further rises in energy prices over the winter”.
But he said the plan “does nothing to help families with the general cost of inflation, in food inflation and in other prices that are rising". Mr Drakeford added: "It does nothing to help families with the very steep increases in energy prices that have already taken place from April of this year.
Read more: Martin Lewis explains what Liz Truss' plans to tackle energy bills mean for you
"It provides no clarity whatsoever on how the package of help is to be paid for. I want to say again that the right way to pay for the costs of energy of households and businesses is to levy a windfall tax on the excess profits of those companies who are making excess profits out of the energy crisis.”
Mr Drakeford also said there would be “no fracking” available in Wales despite Ms Truss’ assertion that the UK government would lift a ban on the controversial practice. You can read more about how ending the fracking ban could affect Wales here.
“Finally, just for the sake of clarity, there will be no fracking available here in Wales," he said. "The way to create energy security for the future is to invest in renewable energy, of which Wales has such abundance. In that way we would not only create a secure supply of affordable energy but we would do so in a way that was making a contribution to, and not a contradiction of, the climate crisis.”
Asked what would be an acceptable level to tax excess profits Mr Drakeford said the government needed to "look at not just the profits companies make in normal times but where those profits have now got to” before deciding what was reasonable to “recycle that money away from excess profits and into the hands of families who will struggle every week this winter simply to heat their homes and keep the light on”.
He said the the Labour Party in the UK had estimated they would have taken up to £60bn in the short term from what could have been up to £150bn in excess profits by energy companies. "The money is there – they were never expecting it," he said. "They are making it because there is a crisis. That money should be put back in the hands of people who need it the most.”
He said Ms Truss had “wrongly” believed that the taxpayer should foot the massive bill for the measures for “years and years to come” and that this was “not the way people in Wales” would think about the economy. He said he had met with his cabinet and confirmed “there will be more” the Welsh Government would do to help those hardest hit. But he said “the major levers remain in the hands of the UK Government".
He added: "They have the ability to borrow money, lever taxation, to invest in the things that will make a difference to the future. We will add to the £380m we have already found in this financial year to help people through this crisis and bend the programmes we already have as a government to help people in what is going to be still a very tough time ahead."
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