Liz Truss insists upcoming energy support plans will save businesses this winter

Business owners have warned they could go out of business if the government doesn't help with energy bills. Credit: PA

Liz Truss admitted that rising energy bills could have forced thousands of British cafes, pubs and shops out of business this winter, but insisted that her government will intervene to prevent that from happening.

Plans expected to be outlined tomorrow (Wednesday) will aim to give businesses support equivalent to the £2,500 price cap being put in place for households. But the support is only likely to last for six months, instead of two years.

Speaking during a trip to New York for the UN General Assembly, the prime minister said the policy was necessary because there was a “very real danger” of companies collapsing under the strain of spiralling prices.

Asked if higher energy bills were a “price worth paying” to take on Russia in defence of Ukraine, she said they were for her government, but not for individual bill payers.

The “point I’m making is, it is a price worth paying for Britain because our long term security is paramount. What I don’t want to happen is for that to be passed on to bill payers beyond that," Truss said.

That is why, she said, she had put together an “energy price guarantee”.

“We do need to make sure we are guaranteeing people are not paying fuel bills that are unaffordable,” she added.

However, critics point out that the price cap gives more money overall to the richest than the poorest.

Truss pointed to additional support for the poorest this winter - put in place by the previous chancellor, Rishi Sunak - that can mean some people receiving up to £1,200 in support. But she has never said whether that support will be extended into the spring.

She also insisted there would be no energy rationing in the UK - despite other countries like Germany urging consumers to reduce their energy use this winter.

Truss said there was an incentive for households and businesses to invest in insulation but said she wouldn’t tell people how to behave.

"Ultimately everyone makes their own decisions about how they decide to do those things," she added.

Politics is back today with Liz Truss in New York, the day after attending the Queen's funeral. Credit: PA

Outside of the energy support, Truss’s economic package is heavily focused on tax cuts - which will be set out during a mini-budget this Friday and plans to deregulate a number of markets. One policy idea that she is considering is removing the cap on bankers’ bonuses.

Asked about the controversial policy on her way to New York and whose side she was on, Truss said she would not confirm what the chancellor, Kwasi Kwarteng, would set out on Friday, but added that she was totally focused on growing the economy.

“We are on the side of delivering a higher wage economy. That’s what we need to do,” said Truss. “We’ll take every measurement… not every measure will be popular."

She said there would always be “vested interests” who would oppose measures to boost economic growth - although it was not clear what those interests might be in those opposing higher wages for bankers.

“What is important to me, what is important to the Chancellor, is that people have more opportunities, there is more investment, there are jobs with higher wages," she said. "And we are prepared to make that argument. This is about growing the size of the pie."

On the question of tax cuts she insisted that would boost the economy, Truss said: “Lower taxes lead to economic growth. There is no doubt in my mind about that.

"Now there are other measures that we have to take to spur economic growth as well… but having the highest taxes in 70 years and putting up corporation tax at a time when we’re trying to attract investment to this country isn’t going to deliver growth. We need to be competitive.”