There is no one to help us: Business owners say government inaction will be the death of many firms

Families and businesses in Scottish Conservative leader Douglas Ross’s Moray constituency reacted with fury to a decision by the UK regulator Ofgem to increase the energy price cap by 80% – a 178% increase on last winter’s levels.

The latest blow comes in the wake of predictions that inflation will hit 18% early next year. And with no sign of help from the UK Government before a the leadership race for a new Prime Minister is over, businesses in Elgin – Moray’s major town – are demanding immediate action. They say the unprecedented hike could be the last straw for some small firms who are still trying to recover from Covid-related closures.

Mum-of-one Laura Scott, 41, who with husband Leigh, 41, owns the Ditsy Teacup cafe, told The Sunday Post: “I am furious. They are not looking out for their customers or businesses. How can they think that they can go on putting the price up and up like this. Where are we going to find the money to pay?

“And if this is the cost to domestic energy users, what will it be for businesses who have no cap? The domestic charge is bad enough but as yet, we have no idea of what our commercial energy bill will be. We just have to prepare for the worst.

“This is a very worrying time. The UK Government needs to act now.”

The Scotts started their business nearly four years ago and have worked hard to come through the pandemic. But Leigh, who also runs Northgate Accounting Services in Elgin, revealed: “Our commercial gas and electric has gone up 85% in the last 12 months. We are struggling through no fault of our own or our customers.

“Our customers are being really supportive but every single cost line has gone up. Our coffee has gone up 28% and chocolate by 30%. There is a cap on what you can charge for a scone and a cup of coffee, and you can’t keep passing that on because people won’t pay it.”

His wife added: “My fear is that we will not be able to keep our doors open. There is no help. No one steps in to protect small local independent businesses.”

Richard Cumming, 41, who runs Sirology, a men’s grooming store in Elgin, warned that, the latest energy hike will spell the death knell for some firms.

He said: “It is hard enough to pass on to customers increases in business costs, now with the hike in energy prices it is impossible.

“Businesses do not benefit in advance from the information and clarity around gas and electric costs domestic customers receive, but we will be hit hard.

“This will send some businesses to the wall.”

to domestic energy users, what will it be for businesses who have no cap? It will be astronomical. The domestic charge is bad enough but as yet, we have no idea of what our commercial energy bill will be. We just have to prepare for the worst. We should not have to wait until we have a new Prime Minister to know what help will be available. This is a very worrying time for people – families and businesses. The UK government needs to act now.”

The Scotts – who have daughter Abigail, 9 – started their business nearly four years ago and have worked hard to come through the Covid-19 pandemic, even increasing their floor space. But Leigh, who also runs Northgate Accounting Services in Elgin, revealed: “Our commercial gas and electric cost has already gone up 85% in the last 12 months. We are struggling but it is through no fault of our own or our customers. Our revenue is going up and our customers are being really supportive but every single cost line has gone up. Our coffee has gone up 28% and our chocolate by 30%. There is a cap on what you can charge for a scone and a cup of coffee, you can’t keep passing that on because people won’t pay it.”

His wife added: “Businesses are fighting tooth and nail. We are busy but the average spend per customer is down because they are facing the crunch. The customers are doing everything they can to support us, they are trying to stretch that pound as far as they can, but it is only going to get worse.

“My biggest fear is that we will not be able to keep our doors open. There is no help. No one steps in to protect the future of small local independent businesses.”

The Scotts believe Rishi Sunak, former Chancellor of the Exchequer and previously Chief Secretary to the Treasury, is better placed than Foreign Affairs Secretary Liz Truss to help ease the crisis, based on his performance during the pandemic. They cite his “quick response” with the furlough scheme and ideas like the 50% Eat Out To Help Out initiative, along with the temporary reduction in VAT.

The couple want to see a repeat of the VAT cut during the current energy crisis, a cap on commercial gas and electricity prices and they also want a reduction in business rates – set by the Scottish government and levied by their local authority.

Like many Moray constituents, they are curious as about their MP’s leadership choice. Ross has so far failed to reveal who he would like to see as PM. “He is never going to say who he wants to win the leadership race,” said Laura. “It doesn’t make a difference to us. Ultimately, he will do what his government wants him to do. All I want or hope from him is that he gives consideration to his local constituents, whether domestic or commercial, when he is thinking about where he wants to go.”

And of the candidates she said: “No matter what they promise, the problem we face is trusting them to stick to their word.”

Richard Cumming, 41, who runs Sirology, a men’s grooming store in Elgin, warned that without appropriate intervention, the latest energy hike will spell the death knell for some firms.

He said: “It is hard enough to pass on to customers increases in business costs, now with the hike in energy prices it is impossible. Businesses do not benefit in advance from the information and clarity around gas and electric costs that domestic customers receive, so it’s difficult to quantify just how hard we will be hit. But we will be hit hard. You cannot budget for what is uncapped and this will send some businesses to the wall.”

In the leadership race, he sees more “cons” that “pros” in both frontrunners and feels Ross is letting the side down by not declaring which he supports. He said: “He should be duty bound as leader of the Conservatives to lead and also to share with the people who elected him which of the candidates he thinks would do the best job as PM and why. He is sitting on the fence.”

The businessman wants the party to quit its “continual loop of in-house squabbling and back stabbing” and “get jobs done.” He claimed: “I am disappointed with politics across the board. Voters have just been left by those they elected to represent them and who have an unrealistic view of what day to day life is like for most people.” He urged all levels of government, UK, Scottish and local, to “forget party lines and work for the people” who voted for them.

Elgin man Grant Anderson, 33, started his business Anderson & Sim Plumbing and Heating Services six years ago with business partner Andrew Sim, 40. He is not interested in the outcome of the leadership race or MP Ross’s stance on it. He said: “It doesn’t matter who is in power, what they promise isn’t usually what they deliver. It is hard to take them seriously. Ross is not the most popular person and his views on the leadership contenders are not likely to change anyone’s opinion.”

However Anderson – like many other tradespeople he knows – is concerned about the cost he is paying for energy use at home and the effects of the hike on his business. He said: “I am paying just about double for energy bills compared to what I was paying before. Now there is another huge rise in October and it will go up again in January. We will be about £4,200 for a year for our domestic bill. We don’t have business premises but we do have business costs.

“We have three vans and had to fill all three with fuel in one week. That cost £540. And if we are not working locally we have to fill up more frequently. A lot of the trades are taking a hit on their profit.

“And tradespeople worry about the work not being there. We are in private houses all the time, and if they are feeling the pinch, they will not want to be paying for a new kitchen, bathroom, boiler or a new central heating system. If the general public are hit hard, then down line the tradesman will be affected. Realistically if the UK government really wanted to do something about the energy crisis, they could.”