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New British Prime Minister Liz Truss on Thursday said domestic fuel bills would be frozen for two years, marking her first week in office with a costly plan to tackle a politically perilous cost-of-living crisis.
The government said it would also review progress towards its legally enshrined target to achieve net-zero carbon emissions by 2050, to ensure the needs of consumers and businesses are taken into account, while stressing it remained committed to the goal.
Households are facing an 80-percent hike in gas and electricity bills next month due to the rise in the cost of wholesale energy made worse by a squeeze on supplies after Russia’s invasion of Ukraine.
Businesses whose bills are not capped have warned they could go to the wall because of even bigger rises, at the same time as inflation is at 40-year highs of 10.1 percent and predicted to go higher.
The government expects the state-backed scheme to cost tens of billions of pounds (dollars), but Truss and new finance minister Kwasi Kwarteng insisted it would have “substantial benefits” to the economy.
It would curb inflation by four to five percentage points, they said in a statement.
