Liz Truss, frontrunner to be the next prime minister for Britain, has pledged to help small businesses after the news of the sharp increase in the energy price cap that Ofgem is preparing to announce, raising bills from £1,971 to £3,600 monthly, with a further rise in January to £4,200. The Treasury has also hinted at presenting options to the next prime minister when they take their seat at Downing Street September 5th. Some of these plans being offered by the Treasury include retooling of Covid-19 loan schemes to help those business facing the terminal rise in energy bills, as well as grants to small companies, business rate holidays and some temporary exemptions from VAT.
Across the board, the energy crisis is already eating into a majority of businesses’ profit margins, with SMEs across the country facing an average bill increase of over 250% in the last year alone, according to Cornwall Insight. In addition, a report by the Federation of Small Business found that 53% of small businesses will stagnate, decline or fold in the next 12 months. This is even more concerning when you consider that 53% of SMEs in the UK are not doing anything to monitor their energy efficiency, and are likely spending far more than they may need to on energy costs. Britain’s leading sustainability experts, SaveMoneyCutCarbon, explain that shopping around and switching tariffs to reduce energy bills has become obsolete.
The British Chambers of Commerce project that less than half (43%) of UK firms are expecting profitability in the next 12 months, whilst 1-in-4 hospitality and leisure businesses fear closing this year due to the inability to afford energy costs, according to eEnergy. In the wake of this setback, a new study from SaveMoneyCutCarbon has found that over half (51%) of employers in the UK still don’t know where or how to start reducing their carbon emissions. This is supported by research from Ecologi, which found that 42% of SME owners in the UK believe that it’s important to be sustainable, but struggle because of a lack of guidance.
