The Cost of Delay.
Not only is this Windfall Tax too little, it is too late.
The Liberal Democrats first called for a Windfall Tax in October of last year.
Ed Davey first proposed the Tax in October of last year. Since then, our MPs have continually raised the concept in the House, in response to spiking energy bills.
Every Liberal Democrat MP voted in favour of a Windfall Tax last week.
Over 300 Conservative MPs were whipped to vote against the Motion. A week later, when Sue Gray's report is spilling tales of misdeeds in Downing Street, the landscape seems to have changed.
The money will land in bank accounts in two portions, in July and Autumn. For communities facing the most significant cost-of-living crisis in living memory, we need immediate support.
The Liberal Democrats have called for an overnight cut of VAT to 17.5%, saving households £600 on average. In turn, given the impact of inflation facing so many working families, a VAT cut will help to keep inflation lower.
When the Government last cut VAT in December 2008, inflation fell from 4.1% to 3.1%. A similar decrease today would cut inflation from 7.8% to 5.9%. The energy price cap rise projected for this October will represent a 14% inflation rate for the poorest tenth of UK households.
The cash payment to households does nothing to address the underlying issue - costs are too high, and wages too low.
Handing a bucket to someone trapped on a leaking boat will only briefly keep them from going under.
We need to reform our approach to energy, subsidise production that cuts costs and carbon, and introduce targeted support that addresses the cost-of-living crisis whilst ensuring that profiteers pay their fair share.