Tory minister Nadhim Zahawi has been criticised for defending "struggling" North Sea oil and gas giants while hard-pressed families face soaring energy bills.
The Education Secretary rejected Labour's plans for a one-off windfall tax on the fossil fuel firms to help support consumers claiming they "don't add up".
Mr Zahawi, a former oil industry advisor, claimed the rise in the national living wage would help people cope with rising energy costs which are set to add hundreds of pounds to average bills.
The biggest British energy firms, BP and Shell, raked in £10.2bn in three months last year and the boss of BP has called the market a "cash machine".
Mr Zahawi told LBC: "I was a businessman before I entered Parliament and I can tell you what Labour are putting out just doesn't add up.
"A windfall tax on oil and gas companies, who are already struggling in the North Sea, is never going to cut it."
He said the Government had poured £4.2million into helping those most in need - and said looming National Insurance hike was a progressive way to raise funds for the NHS and social care.
But Shadow Financial Secretary to the Treasury James Murray said: "Rather than supporting hard-working people facing huge energy bill rises, Government ministers are pleading poverty on behalf of oil companies who are enjoying record profits.”
Labour would impose a windfall tax on North Sea oil and gas producers to fund measures to ease the cost of living squeeze, by reducing the average household energy bill by £200.
The £6.6bn plan would include removing VAT on domestic energy bills for a whole year, as well as expanding and increasing the warm homes discount for those most at risk.
Shadow Chancellor Rachel Reeves blamed ministers for creating a “price crisis” by responding to surging wholesale energy costs with “dither and delay”.
Under Labour's plan, fossil fuel giants would be forced to contribute £1.2bn to help fund the proposals, through a year-long increase to their corporation tax of 10%.
Ms Reeves told Sky: "The Prime Minister was the biggest advocate for cutting VAT on gas and electricity bills during the European referendum.
"But now when cutting those bills would make more difference than ever, the Prime Minister says no".
The Shadow Chancellor said that if now was not the time to cut VAT on energy bills then "frankly I don't know when is".
She added: "Bills can't be paid on broken promises."
Labour announced a £600 million contingency fund to support businesses struggling to cope with soaring energy costs.
Analysis shows that nearly one in four businesses say they have been affected by higher gas prices, with more than 800,000 affected.
The Opposition plans to force a vote in Parliament tomorrow [TUES] to pressure the Government to set up the fund, as well as scrapping business rates.
