Energy crisis could mean £796 increase for Harrogate households as district is among hardest hit

The Lib Dems have hit out at government proposals to deal with soaring energy bills and urged Chancellor Rishi Sunak to scrap the planned National Insurance tax hike which will pile further pressure on household budgets from April.

Their calls come as figures show Harrogate will be the 12th hardest hit area in England during the energy price hikes.

Councillor Bryn Griffiths, leader of the Lib Dems on North Yorkshire County Council, said: "Residents across North Yorkshire have been sorely let down by this Conservative government, they are shouldering the financial pain of Chancellor Rishi Sunak's poor decisions.

"The Lib Dems demand better and object to the Chancellor's approach, he is not fit to lead."

The Lib Dems are also calling for a windfall tax on big profit oil and gas companies, something Spain's left-wing government has already announced.

However, the UK government has argued that a one-off tax like this would stop companies investing as it also defended its own plans for a repayable £200 discount on all energy bills and a further £150 council tax rebate for most households

Harrogate and Knaresborough MP Andrew Jones said: "I understand the arguments for a windfall tax and can see it is superficially attractive.

"But we can only tax UK companies and the current tax rate on oil and gas profits is already 40% – double that on most other sectors of the economy.

"In the gas and oil industry we have investment needs of £11bn in an industry and supply chain which supports almost 200,000 jobs.

"Putting that investment and those jobs at risk would be a very dangerous and potentially hugely damaging blow to British industry."

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Mr Jones added: "Global gas prices are high due to various factors but primarily driven by an increase in demand, a reduction in the availability and because the number of suppliers and the length of the supply chains has decreased.

"Many expect these changes to be medium-term effects and that the factors that have driven the price increase will ease but not totally disappear.

"Anyone claiming that there is a way of avoiding these global higher energy prices for domestic customers going forward is simply making it up."

The council tax rebate will apply from April to homes in council tax bands A to D, benefiting around 52,000 households in the Harrogate district.

It will be made directly by Harrogate Borough Council and will not need to be repaid.

The further £200 discount on energy bills will apply to all domestic electricity customers from October, with the government meeting the costs.

However, unlike the council tax rebate, this discount will be automatically recovered from people's bills in equal £40 instalments over a five year period from 2023, when it is hoped global wholesale gas prices will have come down.

Announcing the measures earlier this month, Chancellor Rishi Sunak said: "I know the number one issue on people’s minds is the rising cost of living.

"That’s why the government is stepping in with direct support that will help around 28 million households with their rising energy costs over the next year.

"We stood behind British people and businesses throughout the pandemic and it’s right we continue to do that as our economy recovers in the months ahead."

By Jacob Webster, Local Democracy Reporter