Rishi Sunak opened the door to an unforeseen tax on oil and gas companies, although he had previously rejected the policy, as Labor accused the government of burying its head in the sand over spiraling bills.
The chancellor hinted at a possible reversal of the tax on oil and gas suppliers, after repeatedly refusing to support the idea in the past, when it was proposed by Labor and the Liberal Democrats.
This comes when Keir Starmer called Boris Johnson “The Comic Ali of the Cost of Living Crisis,” suggesting that the government denies the financial pressures facing households and is devoid of new ideas.
Speaking to Mumsnet, Sunak said he had not taken the path of an unforeseen tax because he did not want to delay investing in new oil and gas production, stressing a recent £ 25 billion investment by a company in the North Sea.
But he added: “What I would say is that if we do not see this type of investment moving forward and companies will not make these investments in our country and energy security, then, of course, this is something I would consider and nothing is always out of the table in these things. ”
Hours earlier, Dominic Raab dismissed the idea of an unforeseen tax as “catastrophic” and “harmful”, while Boris Johnson dismissed the prime minister’s questions Wednesday as a “business tax”.
However, the Tories are under strong pressure due to their lack of ideas on how to deal with inflation, which exceeds 7%, and energy bills are rising even higher.
Johnson held a cabinet cabinet meeting on Tuesday, at which ministers proposed easing rules on how many children can be cared for by crèche staff and allowing less frequent maintenance to help people save money.
But the ideas were criticized as inadequate by Labor, while Thorsten Bell, chief executive of the Resolution Foundation’s think tank, said the government had “lost the plot” if it thought its ideas would make a significant difference in people’s lives.
“Our problem is the large increase in spending for almost everyone, which is more difficult for low / middle income households. So the answer is either to reduce this increase in spending, or to increase the income of these households. The benefit system is the easiest way to do this. “Obviously,” he said.
Starmer made a comparison between Johnson and Comical Ali – the former Iraqi minister who gained cult status for his scandalous lies – during the Prime Minister’s irritating questions, with Starmer saying Johnson was pleased with the “blindingly obvious” economic problems of the people. .
The Labor leader said the discussed plan to allow motorists to receive two-year maintenance instead of one made the ill-fated ’90s cone hotline look’ visionary and inspiring ‘. He said Johnson was “just waking up to the cost of living crisis” and was behaving like an ostrich.
Johnson accused Starmer of “bunny” and rejected his call for an unforeseen tax on oil and gas companies to help reduce people’s energy bills, saying: “This man is doomed to be a regular viewer.”
In their last public speeches before local elections next week, the two leaders exchanged blows during a session that focused mainly on the economy. Starmer said the UK was on track to have the slowest growth and highest inflation in the G7, and said Johnson was failing to run the economy properly.
In a series of targeted questions aimed at blaming the government for the cost of living crisis, Starmer said ministers were making life worse for workers with last month’s “tax increase budget” and failing to help those whose accounts for fuel have increased. “They are the party of super-profits, we are the party of working people,” Starmer said.
He said his party would ask oil and gas companies to pay their fair share, insulate homes to reduce bills and close tax evasion schemes by removing the status of homeless.
Johnson dismissed the unforeseen tax on offshore energy companies, saying it would “hit the very businesses we need to invest in energy to reduce prices for people in this country.”
Expenditure in the North Sea is expected to reach £ 21 billion over the next five years, according to a report published in September 2021 by the UK’s oil trading organization Offshore Energies UK, which shows a higher annual rate of £ 3.7 billion of investments reached in 2020
Shell is considering reversing a plan that would lead it to abandon the Cambo oil field in UK waters after being encouraged by the improving political, regulatory and economic picture. It was revised after the shock of 2021, thanks to higher oil and gas prices, which increased profits to $ 19.3 billion compared to $ 4.85 billion the previous year.
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The company said this month it plans to invest £ 20 billion to £ 25 billion in the UK’s energy system over the next decade, although 75% will be in offshore wind, hydrogen and electric vehicle infrastructure, not in oil fields in the UK. North sea.
BP chief Bernard Looney called the company a “money machine” after gains rose to $ 12.8 billion from a loss of $ 5.7 billion a year earlier. “We plan to continue investing in the North Sea,” BP said in its latest annual report.
Sunak hinted at more help for people’s energy bills in the fall, but said it would be “stupid” to support households now. “We’ll see what happens to the price cap in the fall, I know people are worried about that and wonder if it will go up,” he said. “Depending on what happens to the bills then, of course, if we have to act and support people, we will do it, I’ve always said that. But it would be foolish to do that now. “
The comments drew criticism from Labor. Tulip Sidick, the shadow finance minister, said the chancellor was “out of touch” as families were already feeling the crisis with the cost of living, hit by record energy prices, record high petrol prices and a staggering sharp rise in energy prices. the price of food and basic things. ”
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