Four in five businesses expect to increase their prices over the next two years in response to higher energy costs, a survey showed.

Research by PwC showed 81pc of companies plan to up their prices, while 70pc think they will be less competitive over the period.

Over the last two years, 77pc of businesses said high energy costs had already driven up the price of their products and services, at least moderately, while 67pc blamed energy costs for negatively impacting profits and margins.

A quarter believe Government support on energy costs is “essential for survival”.

Chancellor Jeremy Hunt offered taxpayer money to businesses to cope with the energy shock caused by the war in Ukraine during the winter of 2022-2023 but opted not to do so this year as bills declined rapidly.

Vicky Parker, Sector Leader for Power and Utilities at PwC UK, said: “Government support has provided a helpful and much needed short-term buffer, but has allowed transformational thinking to become less of a priority for businesses. 

“Despite over half of respondents saying the support has been either very important or essential for survival over the last two years, funding of this kind could impede wider economic growth - whilst in operation - and cannot be a permanent coping solution for volatile energy costs.”

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