Keir Starmer unveiled Labour’s new plan to freeze the energy price cap at its current rate on Monday, and was very quick to take on the criticism it has already faced.
The leader of the opposition has just returned from a family holiday, during which time he was accused of missing in action during a national cost of living crisis.
Labour’s new proposals would prohibit the energy price cap from reaching their new forecasted high of £3,582 in October for at least another six months, using a windfall tax on gas and energy companies. But, minutes into his media round, Starmer was asked why Labour did not come forward with this strategy sooner.
On BBC Breakfast, Sally Nugent asked: “How awkward is it that the Lib Dems and the SNP got to this idea first?”
Starmer said his team started looking at this in July, and that he was “very pleased” with their “serious proposal”.
“We’re the only party that has put out there a fully-costed, comprehensive plan.”
He also tried to push past concerns from the director of the Institute for Fiscal Studies, Paul Johnson, who claimed Labour’s plan to secure £7.2billion savings on interest payments on national debt is an “illusion”.
Johnson said inflation – which is already at a 40-year-high – will continue to climb unless Labour is happy to continue subsiding energy bills beyond the six month period it has proposed.
He told The Daily Telegraph: “It’s an illusion in the sense that it will reduce interest debt payments in the short term. But unless you maintain these kinds of subsidies permanently, it won’t reduce them in the long run. Inflation will be higher later on.”
He also told BBC Radio 4′s Today programme that Labour’s plan to cancel the rise in energy price cap would be “looking at the cost of furlough” if extended from six months to a year.
He added: “If this goes on for a very long time, you cannot protect everyone.”
In response, Starmer told BBC Breakfast: “What Paul Johnson isn’t disputing is that our plan will reduce inflation. So he’s absolutely clear that isn’t the case.”
He said he agrees that what happens after April (when the six-month subsidiary period is up) does matter, but the situation will have to be reassessed then.
Starmer also responded to queries about nationalising the energy companies, a move Labour decided not to incorporate into its new strategy.
“Every single penny that is needed for this plan will go directly to reducing the bills of families up and down the country,” he explained.
“If you go down the nationalisation route, money has to be spent on compensating shareholders, and I think in a national emergency where people are struggling to pay their bills, I think the right choice is for every single penny to go to reducing those bills.”
The Labour leader suggested his plan has the potential to cut inflation from 13% to 9% too, as the energy bill hike is dragging prices up everywhere.
Asked why he didn’t prioritise an uplift for people on benefits, he said this strategy benefitted everyone across the country and reduce the “anxiety” of people having to go through the energy price rise in the first place.