Lib Dems pledge windfall tax on banks to lower household energy bills

The Liberal Democrats have vowed to tax banks to raise money that could help people lower their energy bills.

Daisy Cooper, the Lib Dems' deputy leader and Treasury spokesperson, said the party would impose a windfall tax on banks that would fund a new energy security bank that would offer loans to those wishing to make their homes more efficient. Politics latest: Starmer set to recognise Palestine as a state today Speaking at the party's conference in Bournemouth, Ms Cooper said: "Conference, you will remember that we were the first party to call for a windfall tax on the big oil and gas companies when they made profits they weren't expecting due to Putin's illegal full invasion of Ukraine.

"Well now conference, the big banks are making similar windfall profits too, due to an unintended consequence of the quantitative easing programme that was more than a decade ago." She said taxpayers were "shelling out billions of pounds to the shareholders of the big banks simply because interest rates have remained so high for so long". "Banks never expected to receive this windfall," she added.

"They never relied on this windfall, and they never took on any risk to reap this windfall. "So today conference, I can announce that we Liberal Democrats will raise the capital to underwrite our new energy security bank through a new time limited windfall tax on the big banks." The energy security bank would use one-off initial £2bn in capital, raised through the bank windfall tax, to create affordable loans of up to £20,000 for homeowners and £50,000 for small businesses and community energy groups, the party said.

Those loans could be used to pay for items that boost energy efficiency such as solar panels and insulation. The party believes its new energy bank could cut energy bills for a typical household by around £500 a year.

Read more from Sky News:What will the UK's recognition of Palestine achieve?What we know about row between Corbyn and Sultana Asked what impetus there is for people to take up the proposed loan, Ms Cooper told Sky News: "The number of people who write to me, they want to do the right thing, they want to bring their energy bills down permanently, they want to provide their own energy so they have energy security. "They don't want to have their energy bills going up and down all the time.

"People want to take this action. I think that when I hear from households, from families, from small businesses, they are hungry to take action on this issue.

They just need the means to be able to do so." The proposed tax on the banks would be time-limited and targeted specifically at the unexpected interest payments received by the big banks due to Quantitative Easing. It would not require the Bank of England to make any changes.

The Lib Dem conference began on Saturday and will run until Tuesday. The party's leader, Sir Ed Davey, has already called for Elon Musk to be prosecuted for "allowing online harm to children" on his social media platform X.

He branded Mr Musk, the owner of electric car-maker Tesla, a "criminal" and said he could be prosecuted under the Online Safety Act, under which social media companies have a legal duty to protect children from harmful content and their directors are liable for criminal prosecution for breaching it..