Business Secretary accused of 'making things up' by the TREASURY

Business Secretary Kwasi Kwarteng is accused of ‘making things up’ by the TREASURY in astonishing row after he claimed in TV interview Rishi Sunak was planning bailout of firms hit by gas rises

  • Several companies have reported struggling to survive soaring energy costs
  • Kwasi Kwarteng told TV news outlets he was working with Treasury on gas prices
  • But source in the department said Business Secretary was ‘making things up’
  • Comes as firms slammed ministers for failing to help them with price shock

A government minister has been accused of ‘making things up’ in an extraordinary briefing war after claiming he was in talks with the Treasury over high energy prices. 

Business Secretary Kwasi Kwarteng yesterday said he was looking to see whether ‘existing support’ was ‘sufficient’ despite warnings that some factories could shut in weeks.

But in a shocking rebuttal, the Treasury accused him of ‘making things up’ by claiming its departments were in talks about helping industry. 

Mr Kwarteng told Sky News he was ‘constantly’ in conversation with the Treasury to see what support can be given to manufacturers and energy firms.

Business Secretary Kwasi Kwarteng has been accused of ‘making things up’ in an extraordinary briefing war after claiming he was in talks with the Treasury over high energy prices

The Business Secretary said he is ‘convinced’ the nation ‘will have full energy supply’ in the colder months but he could not give a cast iron assurance. Wholesale gas prices have spiked in recent months

But a Treasury source hit back, saying: ‘This is not the first time the [Business] Secretary has made things up in interviews. To be crystal clear, the Treasury are not involved in any talks.’

When he appeared on Times Radio after the Treasury’s comment, Mr Kwarteng insisted there were ‘lots of conversations’ taking place with Treasury – although he had not ‘asked him (Rishi Sunak) for anything’. 

Firms have slammed ministers for failing to help protect companies from an energy price shock that could see factories shutting down within weeks.

Heavy-industry leaders, covering steel, brick manufacturing, chemicals, ceramics and papers, are furious at the inaction.

UK Steel director general Gareth Stace warned of possible ‘long-term damage’ to the industry. He said: ‘Currently, UK steel-makers face energy prices five times higher than the average of last year, in addition to remarkable price volatility.

The surge in wholesale gas prices has already forced many small suppliers in the UK out of business

‘As such, longer and more frequent pauses in production are becoming a fact of life. These circumstances are simply not sustainable for the sector.

‘We urge the Government to take action, as has been done in Italy and Portugal, to support the sector.’

Warring in Whitehall

Kwarteng tells Sky News:

‘I spoke very extensively with the energy intensive users industry on Friday.

‘We’ve already over the last few years given lots of support on electricity pricing – in particular power – and we’re speaking constantly with them to see if there is a way through, and also engaged the Treasury as well.

‘I can’t promise anything as yet but we are absolutely focused on solving this problem.’

Asked if he had asked the Treasury for a subsidy, Mr Kwarteng, pictured, said: ‘No I haven’t… but we are constantly, as you would expect, in conversation with them to see where we can support.’

Treasury source hits back:

‘This is not the first time the BEIS [Business, Energy and Industrial Strategy] Secretary has made things up in interviews. To be crystal clear the Treasury are not involved in any talks.’

Dr Laura Cohen, chief executive of the British Ceramic Confederation, said: ‘I am really concerned that the Secretary of State hasn’t understood the urgency of what we’re asking for.

‘We need practical gas emergency measures that keep enough gas available and our factories going when supplies get tight.’

Experts have warned consumers to brace for the next review of the cap in April amid fears soaring wholesale energy prices could push average annual bills through the £2,000 barrier for the first time. 

Mr Kwarteng guaranteed he will keep the energy price cap for consumers in place throughout the winter but said he will not ‘bail out failing energy suppliers’.

Asked if he had approached the Treasury about subsidies for industry, said: ‘No, I haven’t.

‘We’ve already got subsidies in place and it’s very clear that a lot of those are working.’

Labour Treasury spokesman Bridget Phillipson called on the Government to ‘get a grip’.

‘The two key government departments responsible for the current cost of living crisis have spent this morning infighting about whether they were in talks with each other. What a farce,’ she said. 

‘If government ministers can’t even tell the truth about each other, then what hope do we have for the challenges facing our country?

‘We need urgent answers on who exactly is running the show.’

Shadow chancellor Rachel Reeves added to the criticism, saying: ‘If the Treasury isn’t in talks with BEIS to help our vital industries during this Conservative government’s energy crisis, then why on Earth aren’t they? What is the Chancellor actually doing?’ 

A Department for Business, Energy and Industrial Strategy spokesman said: ‘We are determined to secure a competitive future for our energy intensive industries and in recent years have provided them with extensive support, including more than £2 billion to help with the costs of energy and to protect jobs.

‘Our exposure to volatile global gas prices underscores the importance of our plan to end Britain’s dependency on fossil fuels and build a strong, home-grown renewables sector so we can protect consumers into the future from gas prices set by international markets.’

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