Starmer Adviser Calls for Profits Cap on Energy and Petrol Firms Amid Rising Costs

A senior adviser to UK Prime Minister Keir Starmer has urged government ministers to consider imposing a temporary cap on the profits of energy and petrol companies to protect consumers from surging costs. The call comes as households across the country struggle with rising energy bills and the ongoing cost-of-living crisis.

Lord Richard Walker, Labour peer and newly appointed cost-of-living adviser, stressed that while companies should be allowed to make reasonable profits, excessive earnings during a crisis amount to profiteering. Walker, who also serves as executive chairman of Iceland supermarkets, argued that the government should explore measures to prevent businesses from exploiting high prices while families face financial pressure.

“I have asked the government to consider a temporary profit cap… to stop producers and retailers exploiting the crisis to make windfall profits at the expense of consumers,” Walker said. He added that profit is essential for investment and job creation, but it should not come at the expense of vulnerable households struggling to pay bills.

The proposal comes amid ongoing pressure on energy markets, particularly due to geopolitical tensions in the Middle East, which have contributed to higher oil prices and increased costs at the pump. Analysts warn that continued volatility in energy prices could prolong inflationary pressures and slow economic growth.

Currently, the UK has a windfall tax targeting North Sea oil and gas producers. Walker’s recommendation would expand the approach to include both producers and retailers, potentially covering companies supplying fuel directly to consumers. Government officials have not confirmed plans to implement the measure but acknowledge that it is under active discussion as part of broader strategies to ease household financial burdens.

Supporters of a temporary cap argue that it would protect consumers during extraordinary market conditions without permanently interfering in business operations. Critics, however, caution that such a move could discourage investment or complicate market dynamics.

The government is also facing mounting calls to reconsider a planned increase in fuel duty later this year. Consumer groups and motorists are pressing ministers to act quickly to alleviate the strain on household budgets. With public scrutiny intensifying, discussions over a profits cap are expected to continue in the coming weeks as the government weighs options to balance consumer protection with market stability.