ESCALATING energy costs are now a serious concern for the South East’s small and medium-sized businesses, the Institute of Directors has warned.

As many manufacturers and smaller enterprises find it difficult to pass on price rises, any hikes in the cost of gas could put their future at risk.

Chairman of the Kent branch of the IoD, Alyson Howard, said: "Gas prices are so high now that without urgent Government action tens of thousands of jobs in manufacturing could be at risk.

"Already this year we have seen some businesses fail due to these energy price increases. And the supply industry markets in the rest of the European Union is having a detrimental effect on the UK. The structure of supply needs to be more liberal.

"Energy is one of the big infrastructural issues of the day and we recognise there is no quick and easy answers to the problems of pricing, markets and supply. But it is because of this recognition that we call on the Government and the EU to address these issues urgently."