Scottish Government urged to bring energy proposals to Holyrood next week

The Scottish Government has been urged to outline how it will spend consequentials to counter rising energy prices in the country as the First Minister said “every single penny” received will be spent on the crisis.

Scottish Labour deputy leader Jackie Baillie made the call during a debate on the soaring cost of living, as regulator Ofgem rose the cap on energy prices by £693 on Thursday.

Chancellor Rishi Sunak announced that all households will get a £200 discount on bills from October, but that will have to be repaid over five years.

Homes in England will also get a £150 council tax rebate for properties in bands A-D.

The UK Government estimates that devolved governments in Scotland, Wales and Northern Ireland are expected to receive approximately £565 million of Barnett funding as a result of the council tax rebate.

“Every single penny must go into the pockets of people who need urgent help, so will the SNP bring proposals before the chamber next week to outline how it will distribute the money?” Ms Baillie asked during the debate.

“This cannot wait, there must be no excuses, no inaction, no hiding behind the constitution.

“They must act and act now in the interests of the people of Scotland.”

The debate pushed for MSPs to support a windfall tax to be levied against the profits of oil and gas companies.

Speaking at First Minister’s Questions, Nicola Sturgeon said it was too early to say where money would be spent, given it was less than an hour after the announcement had been made.

Ms Sturgeon told MSPs: “I’ve not heard all of the detail because he was still on his feet as I came into the chamber, but the Chancellor has just announced what sounded like welcome steps to help mitigate (the rising price cap) but steps that, in my view, do not go far enough.

“They seem to offer around £350 of help against energy bill increases of around £700.

“I also don’t yet know what the position on consequentials will be, but I give a commitment here that – assuming there are consequentials, which I would expect there to be – every single penny of them will go in Scotland to helping people deal with the cost-of-living crisis.”

In a statement released on Thursday afternoon, Energy Secretary Michael Matheson said it was “deeply disappointing” the Scottish Government had not been consulted on the mitigations proposed by the Treasury, adding: “The Scottish Government is using all powers and resources available to us to support people in Scotland from the cost-of-living crisis.

“However, powers relating to the energy markets remain reserved and I, alongside ministerial colleagues, have repeatedly called for the UK Government to urgently take further, tangible actions to support households – including a reduction in VAT, targeted support for those on low incomes and four-nations discussions to develop an effective response to the energy bill increases.”

Under questioning from Labour leader Anas Sarwar – who attacked SNP MPs for voting against proposals to institute a one-off windfall tax – Ms Sturgeon said she was not against the idea, but added the resolution must be “fair and equitable”.

“I am not opposed to oil and gas companies making a contribution because their profits are rising,” she said.

“I am not opposed to that, I’m simply saying these approaches should be fair and equitable. That is the point I’m making, and I’m also making the basic point that I don’t have the power over that.”