Government ministers have been urged to make a decision on the industries that will receive energy support from spring 2023, as businesses brace themselves for price hikes which could see their energy bills more than double.
The Guardian reports that the Confederation of British Industry (CBI) has called on the government to outline their plans pertaining to how the Energy Bill Relief Scheme will be extended beyond its current end date on March 31st 2023.
Introduced in October 2022, the scheme set out to discount wholesale energy costs for companies, charities and public sector organisations.
This was due to replicate the support offered to households, following the enormous rise of global energy costs.
The government had previously announced that support will continue for certain industries. However, with the new year fast approaching and companies currently slating their financial plans for the coming year, business owners across the UK are seeking clarity fast.
Rising Energy Costs for Businesses in 2023
With companies across the UK already enacting cost-saving measures, such as reducing headcount, pausing capital investments and passing rising costs onto their customers, a further rise in energy prices would be a hammer blow to businesses.
The Federation of Small Businesses have reported that half of SMEs expect to raise prices further if energy support ends in March. Moreover, a third of businesses have already paused growth plans for 2023, in the face of financial uncertainty.
In a survey of over 700 members, the CBI revealed that businesses expect their bills to more than double without additional assistance from the government.
“The high cost of energy is dominating the decisions that businesses are making each and every day” said Matthew Fell, the Chief Policy Director at the CBI.
Continuing, Fell said: “There are no easy answers in all this, but the government will have to keep supporting the most vulnerable firms to help them stay competitive, to build resilience and in some cases to avoid collapse.”
“We must also take heed of the lessons from the pandemic, where providing additional cashflow support, especially to [small to medium-size enterprises], was critical to seeing businesses through this period”.
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