Britain’s new prime minister must slash energy levies paid by businesses to speed up economic ​growth, a leading employers group and an energy ‌trade body said on Tuesday.

With former Manchester mayor Andy Burnham poised to enter Downing Street, the Confederation of British ​Industry and Energy UK said 40 per cent of firms ​were cutting investment due to high energy costs ⁠with electricity prices 45 per cent above the Group of Seven ​median.

The two organisations said in a report:

  • The government should ​remove its Renewables Obligation and Feed-in Tariff costs for all businesses
  • The money could be raised via general taxation or a publicly ​or privately financed Energy Transition Funding Scheme
  • The Climate ​Change Levy should also be taken off non-domestic electricity bills, the ‌CBI ⁠and Energy UK said
  • The changes could cut energy costs by up to 20 per cent
  • Other reforms are needed to reduce the cost of the energy system and support ​electrification of ​the economy
  • “If ⁠we want to tackle the cost of living and invest in public services, we ​need stronger economic growth – and that can’t ​happen ⁠while firms are navigating sky-high energy bills,” Louise Hellem, the CBI’s chief economist, said
  • Separately, the Trades Union Congress ⁠called ​for a hike in a ​tax on bank profits to allow a cut in energy bills for ​most households