Sunday, August 7, 2022

Johnson’s ‘zombie government’ urged to help with energy bills as Centrica raked in a £1.3billion profit

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The company is now reintroducing a progressive dividend, initially offering an interim payout of 1p per share

The UK’s biggest utility saw a sharp rise compared to the £262m in profits it posted in the same six months last year.

Centrica has been criticized for benefiting from the cost of living crisis as it reported rising profits, which quintupled to £1.34 billion, in the first half of this year.

It said this was boosted by asset sales and rising energy prices, allowing it to restore its dividend.

But the company’s record profits come at a time when millions of consumers are facing record-high energy bills this winter.

Now Boris Johnson has been criticized for his ‘zombie government’ with consumer champion Martin Lewis, who claimed it is not doing enough to help consumers with soaring energy bills.

It comes after the Prime Minister said in a speech in Birmingham today: “I know the pressures people are facing in terms of their cost of living and the global inflation issues we are seeing, the energy shortages, the cost of gas in every country around the world feels it.

“But my argument to you would be that sometimes you have to go through tough times and remember that they’re just inevitable.”

In response, Mr Lewis said: “The problem is that right now we have this zombie government that can’t make big decisions.”

He urged the Prime Minister, Mr Sunak and Ms Truss to put together an emergency package of support and said decisions should not be delayed until the Tory leadership contest is complete.

At that point, households will start getting higher bills sooner before the energy price cap rises to £3,500 or more in October.

He dismissed the extra help promised by Mr Sunak and Ms Truss during their leadership bids as “trivial” amid bills that are expected to be £2,300 a year higher than last October.

He said: “Either you have to lower the prices for the people or you have to put more money in their pockets, especially at the poorest level.”

Ed Davey, MP, leader of the Liberal Democrats and former Secretary of State for Energy and Climate Change, agreed with Mr Lewis.

“Conservatives are too busy fighting among themselves to do anything about it. In fact, those gains aren’t even covered by the windfall tax, which Mr. Sunak ended up supporting.

He added that energy companies are “enjoying a bonanza” while millions are experiencing the harshest winter “in generations”.

“Millions of people and businesses face financial disaster while oil and gas companies revel in booming profits.

“We need a much tougher windfall tax to get the funds to help millions of people through the harshest winter in generations.”

Centrica, the UK’s largest utility, has seen its profits rise significantly this year compared to the £262m profits it posted in the same six months last year.

It’s also reintroducing a progressive dividend, initially offering an interim payment of 1p per share.

The British Gas owner halted dividends in 2020 and embarked on significant cost-cutting, selling upstream assets and attempting to reinvent itself as an energy service provider.

British Gas’s operating profits fell 43 per cent to £98m over the period as the company had to buy more energy on the wholesale market than expected to meet customer demand.

It said it made £6 of profit per customer after tax in the first half of the year.

In May, Centrica completed the sale of its 69% stake in Spirit Energy’s Norwegian oil and gas assets to Norwegian private equity firm Sval Energi for around £560m.

Chris O’Shea, CEO of Centrica, said, “We have made significant strides in de-risking the group and building a stronger business for the benefit of all stakeholders.”

“We are very aware of the difficult environment of many customers and will continue to support them.”

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