Chancellor Rishi Sunak’s team bluntly accused one of his cabinet colleagues of lying over the energy crisis that threatens to shut down factories as household bills soar.
The business secretary, Kwasi Kwarteng, had claimed he was in talks with the Treasury about emergency packages to help struggling firms.
But an official responded by telling Sky News: ‘This is not the first time the business secretary has made things up in interviews.
‘To be crystal clear, the Treasury are not involved in any talks.’
But Home Office minister Damian Hinds denied this morning that Mr Kwarteng had lied.
‘These unnamed sources stories come out from time to time,’ he told Sky News.
‘The fact is Government departments, Government ministers, talk to each other the whole time and of course with an issue like this, with these rising global prices and business having to grapple and deal with it to make sure they break even and can make a margin of course that is something that the business secretary – and of course the energy secretary – is going to be totally focused on.
‘Something that the Treasury, of course, is also very focused on as the economic management department of the nation.’
The row came after the pair’s boss Boris Johnson jetted off to Marbella for his second family holiday in just over a month — with Labour accusing the prime minister of presiding over ‘a farce’.
Mr Kwarteng was unable to rule out gas outages this winter, as experts warned that average household fuel bills could rocket past £2,000 per year for the first time.
Ministers have faced mounting pressure to introduce support for high-energy industries hit by surges in wholesale gas prices, amid warnings some firms could be forced to suspend operations within days.
Makers of steel, glass, ceramics and paper have said they may have to halt production without help.
Mr Kwarteng was asked on Sky News’s Trevor Phillips On Sunday if he had approached the Treasury about possible subsidies for ailing firms.
He said subsidies were in place and it was ‘very clear a lot of those are working’.
He added: ‘We need to help them get through this situation — it’s a difficult situation, gas prices, electricity prices are at very high levels right across the world and of course I’m speaking to government colleagues, particularly in the Treasury to try and see a way through this.’
When later challenged over the Treasury official’s retort, Mr Kwarteng told Times Radio there were ‘lots of conversations’ with Mr Sunak’s team though he had ‘not asked him for anything’.
Labour’s Bridget Phillipson, shadow chief secretary to the Treasury, said: ‘In the teeth of a crisis of its own making, the Government has put its out-of-office on.
‘The prime minister has gone on holiday, no one knows where the chancellor is, and this morning we understand the business secretary has entered the realms of fantasy.’
UK Steel boss Gareth Stace warned a lack of help ‘may result in long-term damage to the future of the industry’.
And Energy UK’s Emma Pinchbeck said she was expecting more household suppliers to go out of business.
The wholesale price of gas is up 400%, partly due to low stocks.
But OVO Energy boss Stephen Fitzpatrick told the BBC’S Andrew Marr: ‘There’s really nothing consumers need to worry about in terms of lights going out this winter or there not being enough power.’
The Department for Business, Energy and Industrial Strategy said energy intensive industries had received £2 billion of support in recent years.
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