Inside Politics: Freeze

Labour leader Keir Starmer sets out plan to tackle soaring energy bills, writes Matt Mathers

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Hello there, I’m Matt Mathers and welcome to The Independent’s Inside Politics newsletter.

Manchester United slumped to a second consecutive defeat at the weekend, thrashed 4-0 by Premier League minnows Brentford. It really is the end of days, at Old Trafford at least. Fresh from his summer break, Keir Starmer is hoping to score a victory today as he sets out Labour’s plan to tackle the energy crisis.

Inside the bubble

Parliament is not sitting.

Starmer is on BBC Radio 4 Today at 8.10am.

Tory MP and Liz Truss backer Brandon Lewis is on Sky News Breakfast at 8.30am.

Daily briefing

Extend windfall tax

After facing accusations that his party has been too quiet lately on the cost of living crisis, Keir Starmer today sets out Labour’s plan to tackle soaring energy bills. So what’s in it? The main plank of Labour’s offering is to freeze the price cap at its current level of £1,97 for six months, which it says would save the typical family £1,000.

How would it be paid for? The party says it would fund what it says is its fully costed proposal, totalling £29 billion, by extending the windfall fall tax imposed on oil and gas giants by the government earlier this year, following pressure from Labour.

Starmer says Labour would also close what it described as an “absurd loophole” in the tax by backdating the start date to January, to account for higher oil and gas prices, which would raise £8 billion rather than the £5 billion the exchequer expects to take in from the current plan. The party says it would also use the £14 billion of non-targeted funding announced by Rishi Sunak, the former chancellor and Tory leadership hopeful, to prevent bills from rising.

In addition to saving the average family £1,000, Labour claims its plan would bring down inflation by 4 per cent, thereby reducing interest on government debt racked up through borrowing, raising a further £7 billion.

What do the economists think, and what does Labour’s plan mean in practice? The Institute for Fiscal Studies, the respected think tank which has its own research out today saying that the government needs to raise £14bn to tackle the crisis, has picked up on the latter point about interest rates, saying these would only be reduced over the longer-term if the subsidies continue for longer than the six months Labour is proposing. It has said, however, that Starmer has gone much further than either Sunak or Liz Truss, the foreign secretary and frontrunner to replace Boris Johnson as prime minister, in costing their plans.

Labour, the SNP and the Lib Dems are all now calling for the price cap rise to be scrapped, which will pile pressure on Sunak and Truss to take more drastic action. The problem is that none of them is in power at Westminster. And until the zombie government in Downing Street is replaced families will continue to struggle. Labour’s plan makes the front of several news outlets this morning, including The Times, which carries a poll saying 3 in 4 Tory voters back Starmer’s proposals.

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You can’t keep a Big Dog down

Much has been said and written about the Tory love affair with Truss. But there is only one person the Tory faithful love more – and that is the Big Dog himself.

Boris Johnson still has the biggest bark as far as the party faithful are concerned, with the latest Opinium poll showing that a majority of members still prefer him to Truss or Sunak.

Opinium’s survey shows that Truss has a healthy lead over Sunak in the race to replace Johnson, ahead 61 per cent to 39 per cent among Tory members.

The poll shows signs of regret at the PM’s political demise over the Partygate scandal, and an apparent lack of enthusiasm for either of his would-be successors.

It will be good news for Johnson, who is reportedly enjoying his second holiday in as many weeks – which critics might argue says a little something about why he is on his way out of No 10 Downing Street.

On the record

Starmer says Labour’s ‘fully costed’ plan would fix energy crisis.

“Labour’s fully-funded plan would fix the problems immediately and for the future – helping people get through the winter while providing the foundations for a stronger, more secure economy.”

From the Twitterati

Sky politics correspondent Liz Bates asks if anyone will listen to Labour’s plan.

“Keir Starmer will tomorrow call on the govt to freeze the energy price cap to protect consumers from massive prices increases this winter… He’s been accused of being quiet over the past few weeks. Will they listen now?”

Essential reading

• John Rentoul, The Independent: Will Liz Truss be able to put the Conservative Party back together again?
• Adam Forrest, The Independent: Will Truss be the ‘war on woke’ prime minister?
• Clare Foges, The Times: All this bluster and boosterism is dangerous
• Hamish McRae, The Independent: Is inflation on its way to being beat? US markets say yes

Inside Politics first appeared in our daily morning email. You can sign up via this link.