Five questions answered on Scottish Power’s latest price cuts

By how much is Scottish Power cutting its prices?

Scottish Power has announced it is to become the fourth energy supplier to cut the price of one of its tariffs. We answer five questions on the energy company’s latest price cut.

By how much is Scottish Power cutting its prices?

According to the company, customers on its standard duel fuel tariff will see a reduction of £54 off their annual bill from 31 January.

The price drop will not include customers who are on a fixed rate tariffs. However, Scottish Power has assured 97 per cent of customers on a fixed tariff were already paying less than those on standard tariffs.

Why has Scottish Power cut its prices?

To bring the price of its tariffs in line with government changes to green levies announced in December.

However, the price drop will only partly counteract a Scottish Power price rise of 8.6 per cent which came into effect as of December last year.

What has Scottish Power said about its price changes?

In an online statement Scottish Power’s CEO of Energy Retail and Generation, Neil Clitheroe, said:

“Following the Government’s recent announcement on reducing the impact of green and social levies on consumer energy bills, we will be passing these cost reductions on to customers this month.

“We recognise that we need to continue to work hard to reduce bills for our customers through offering competitive fixed priced products and comprehensive energy efficiency advice. As part of this ongoing commitment, we will try to avoid any further price rises in 2014 but this will depend on whether there are increases in wholesale energy prices or other costs outside of our control.”

Which other energy companies have cut prices recently?

British Gas and SSE have both announced price cuts for customers regardless of what tariff they are on. SSE said it will cut prices by around 4 per cent from the beginning of April.

EDF and E.On have cut prices for those on standard or variable rates, the same as Scottish Power.

Npower has failed to announce price cuts, saying it is still reviewing its prices. In the autumn 2013 the company raised its prices by 10.4 per cent.

What have the experts said?

MoneySuperMarket has called on energy suppliers to follow the example of British Gas and SSE, and cut all their tariffs, not just standard duel fuel tariffs.

The price comparison website has launched an epetition in a bid to get all suppliers to do this.

Work on power cables in Cumbernauld, Scotland. Photograph: Getty Images.

Heidi Vella is a features writer for Nridigital.com

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Theresa May defies the right by maintaining 0.7% aid pledge

The Prime Minister offers rare continuity with David Cameron but vows to re-examine how the money is spent. 

From the moment Theresa May became Prime Minister, there was speculation that she would abandon the UK's 0.7 per cent aid pledge. She appointed Priti Patel, a previous opponent of the target, as International Development Secretary and repeatedly refused to extend the commitment beyond this parliament. When an early general election was called, the assumption was that 0.7 per cent would not make the manifesto.

But at a campaign event in her Maidenhead constituency, May announced that it would. "Let’s be clear – the 0.7 per cent commitment remains, and will remain," she said in response to a question from the Daily Telegraph's Kate McCann. But she added: "What we need to do, though, is to look at how that money will be spent, and make sure that we are able to spend that money in the most effective way." May has left open the possibility that the UK could abandon the OECD definition of aid and potentially reclassify defence spending for this purpose.

Yet by maintaining the 0.7 per cent pledge, May has faced down her party's right and title such as the Sun and the Daily Mail. On grammar schools, climate change and Brexit, Tory MPs have cheered the Prime Minister's stances but she has now upheld a key component of David Cameron's legacy. George Osborne was one of the first to praise May's decision, tweeting: "Recommitment to 0.7% aid target very welcome. Morally right, strengthens UK influence & was key to creating modern compassionate Conservatives".

A Conservative aide told me that the announcement reflected May's personal commitment to international development, pointing to her recent speech to International Development staff. 

But another Cameron-era target - the state pension "triple lock" - appears less secure. Asked whether the government would continue to raise pensions every year, May pointed to the Tories' record, rather than making any future commitment. The triple lock, which ensures pensions rise in line with average earnings, CPI inflation or by 2.5 per cent (whichever is highest), has long been regarded by some Conservatives as unaffordable. 

Meanwhile, Philip Hammond has hinted that the Tories' "tax lock", which bars increases in income tax, VAT and National Insurance, could be similarly dropped. He said: "I’m a Conservative. I have no ideological desire to to raise taxes. But we need to manage the economy sensibly and sustainably. We need to get the fiscal accounts back into shape.

"It was self evidently clear that the commitments that were made in the 2015 manifesto did and do today constrain the ability to manage the economy flexibly."

May's short speech to workers at a GlaxoSmithKline factory was most notable for her emphasis that "the result is not certain" (the same message delivered by Jeremy Corbyn yesterday). As I reported on Wednesday, the Tories fear that the belief that Labour cannot win could reduce their lead as voters conclude there is no need to turn out. 

George Eaton is political editor of the New Statesman.

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