Treasury reprimands Kwarteng after support for firms claim 

According to The Guardian, the treasury has issued an extraordinary reprimand to Kwarteng, after he suggested he was consulting with the chancellor about support for firms struggling with soaring energy prices.

Sources at the department have also denied it had received any proposals or even discussion about support for ailing essential industries, despite claims made by Kwarteng to broadcasters on Sunday morning (10 October).

On Sunday, Kwarteng told the BBC’s The Andrew Show the situation was “critical” and said he was “looking to find a solution”. He added: “We already have existing support and we’re looking to see whether that’s sufficient to get us through this situation.”

Speaking to Sky News’ Trevor Phillips On Sunday, when asked if the UK would have uninterrupted gas supplies this winter, Kwarteng said: “I’m as certain as I could be.”

He added: “Because obviously this is a global issue, so we’ve seen right across the world real supply chain pressures, you’ve seen the Chinese have power blackouts, they’re rationing supply. Here in the UK our job is to make sure there is minimal disruption, and I’m very confident.”

It comes after representatives from firms in key industries told Kwarteng at a meeting on Friday that many are “days away” from having to halt production because of rapidly increasing costs. According to The Guardian, one industry boss who attended the meeting said the business secretary had at first seemed blasé about the potential problems for the industry.

However, after pressure from businesses, he had promised to examine their suggestions and ask the treasury to consider some of their demands. These included reducing green levies and the request that regulator Ofgem replicates the network tariff discounts offered in the European Union.

Sources close the chancellor, however, cautioned the business secretary against making any promises to companies and said there had been no approach to the treasury.

And, while Kwarteng suggested struggling companies would not get much support from the treasury but was liaising with Sunak, one treasury source said it was wrong to suggest the pair were already in discussions about potential support.

They told The Guardian: “Kwasi was mistaken. The facts are that, to date, the treasury and the chancellor have not been involved in any talks on this topic. They did not rule out any further support but said the treasury could not assess what may be necessary without seeing proposals.

On Monday, it emerged Number 10 was backing Kwarteng, with Prime Minister Boris Johnson’s spokesman telling The Guardian: “As you would expect, ministers from BEIS [Business, Energy and Industrial Strategy] are working across government, including with treasury, on this important issue, the challenges that are currently facing industry in light of global gas prices, and that will continue.”

He also said it was “right to continue to listen to industry” and “see if further mitigations are necessary” on top of an existing scheme to help heavy industry with high energy prices. He added: “We recognise they are facing a particular challenge at this point and we’ll continue to discuss that with them.”

One thing Kwarteng has ruled out is the lifting of the energy price cap, describing it as a “non-negotiable for me”. Writing in the Sunday Express, he added: “The safety net that we have in place to shield consumers from instant price hikes in Christmas, and ensure everyone gets the supply they need.

“Despite some pushing me to lift the cap, I am absolutely clear it is here to stay and will remain at the same level throughout winter. Keeping this protection in place is non-negotiable for me.”

It comes after some firms have been lobbying for an increase to prevent collapses due to the energy crisis, with some saying it would not protect households from an expected rise in costs.