Liz Truss will replace her predecessor Boris Johnson in Downing Street on Tuesday, a day after she won the Conservative Party’s race to take over the British government over her rival, former finance minister Rishi Sunak.
The new prime minister used her victory speech to pledge to “end the energy crisis” by dealing with bills as well as supplies.
It is known that freezing energy bills is one of a number of options being worked out to help families who are struggling to cope with the high costs. It is expected that energy suppliers will be able to obtain subsidized loans from the government to support the bills.
The heads of energy companies had met with government officials on this issue. Energy companies last month proposed a £100 billion plan to freeze home bills.
“I will present a bold plan to cut taxes and grow our economy. I will tackle the energy crisis, I will deal with people’s energy bills, I will also address the long-term problems we have with our energy supplies,” Truss said after the result was announced.
According to “Bloomberg”, Truss has prepared a 130 billion pound plan for 18 months to reduce energy bills that are due to start at the beginning of next month under the current pricing system. Bloomberg said Truss has drawn up plans to fix the annual electricity and gas bills of a typical British family at or below the current level of 1971 pounds ($2,300).
Truss takes the reins as the country grapples with a cost-of-living crisis, industrial unrest, recession, and war in Europe, with Britain being one of Ukraine’s main backers.
Bank of England
In this context, a member of the Monetary Policy Committee of the Bank of England, Catherine Mann, said Monday that the bank should be prepared to raise interest rates quickly to reduce the possibility that it will need to constrain the economy for an extended period in order to bring down inflation.
The Bank of England’s “gradual” approach, which included four quarter-percentage point rate hikes this year followed by a half-percentage point increase last month, failed to dampen people’s price expectations, an important driver of inflation in the medium term.
The Bank of England said last month it was ready to “move aggressively” if needed in the future after it raised interest rates to 1.75 percent when it decided on its first 50 basis point increase since 1995.
Mann was asked whether the Bank of England should consider raising interest rates by three-quarters of a percentage point at its September 15 meeting, and she replied, “An important question.”
