Government delays decision on further energy support for businesses

A decision on whether government support for businesses dealing with high energy bills should be extended has been delayed until the new year, it has been confirmed.

In September, the government announced an £18 billion Energy Bill Relief Scheme (EBRS), which promised fixed wholesale gas and electricity prices from 1 October 2022 to 31 March 2023. The announcement was welcomed by many in the sector, who feared the unprecedented energy bill price hikes could force venues across the country to close.

At the time of the announcement, ministers promised an update before the end of the year, which was expected to detail what – if any – support would be available after the end of the March, and whether that would take the form of an extension to the scheme or targeted support for the most vulnerable businesses.

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But the Treasury has now confirmed there will be no update before 2023.

A government spokesperson told the BBC the scheme “is very expensive and we need to ensure longer-term affordability and value for money for the taxpayer”.

“That is why we are currently carrying out a review with the aim of reducing the public finances' exposure to volatile international energy prices from April 2023,” they added.

“We will announce the outcome of this review in the new year to ensure businesses have sufficient certainty about future support before the current scheme ends in March 2023.”

Sector disappointment

Co-CEO of Society of London Theatre and UK Theatre, Hannah Essex, said the coalition is “extremely disappointed” by the delay.

“Like businesses across the economy, the theatre sector depends on this announcement to forecast its energy costs into the next financial year,” Essex said.

“With the theatre sector being particularly vulnerable to energy price hikes, venues and producers will likely be making tough decisions on how to respond to the expected increase, in some cases running at 175% even with the current support in place.”

Essex added that organisations selected to be part of Arts Council England’s next National Portfolio have an obligation to present business plans to the funder by 20 January, but “will not be able to accurately assess the impact of energy costs on their planning until it is potentially too late to be considered as part of their portfolio offer”.

The National Council for Voluntary Organisations (NCVO) has said the uncertainty around energy costs after March is “making it impossible” for charities to plan ahead, adding that it has urgently appealed for continued EBRS support for all voluntary organisations.

“Ending support is not an option – half of charities are using reserves to pay for day-to-day costs, opting to support more people now at the risk of needing to shrink or close in the near future,” a statement from the body said.