Government poised to cut energy support scheme for businesses

The government is poised to cut the amount of support it provides to help businesses with soaring energy costs.

The energy relief scheme, which was introduced last autumn to help public sector organisations and charities as well as businesses, expires at the end of March.

Chancellor Jeremy Hunt is expected to announced what will replace this scheme this week, and could unveil the new package in the House of Commons as early as Monday.

But following a round of meetings with business organisations last week, it is now widely expected that Hunt will cut the support significantly. Hunt has warned that the current scheme - which is expected to cost more than £18bn by the time it expires - was "unsustainably expensive".

It is thought the replacement scheme will provide a discount on wholesale prices, rather than a fixed price, with heavy energy-using sectors getting larger discounts.