Written by Marcos Margarido
Tuesday, 10 December 2013 14:02
After Miliband’s speech at the Labour Party conference pledging a 20 month price freeze on energy suppliers should his party win the 2015 elections, the energy issue has become a heavily commented subject in the media.
From the right, Miliband was accused of “Leninism” and his “Red Ed” 2010 epithet was resurrected. The Energy Minister, Greg Barker, said that the proposal would lock out competition, raise the cost of capital and drive away foreign investors. It was no coincidence that the big six energy companies expressed the same opinion. Not to mention that the more exalted, Centrica chairman, argued that a price freeze would lead to “economic ruin”.
The Guardian, in turn,hurried to defend Miliband’s “saying something” attitude for“at last showing voters who fits into this nation. And who doesn’t: namely, multinationals that don’t invest in Britain or that don’t play fair.”
The ISL, on the other hand, has argued in October’s Socialist Voice issue that Labour was moving fast to the right. Has his speech proven we were wrong? For us, Labour has not changed its position. His speech, on the contrary, reaffirms what we said.
The prices rise and Labour’s answer
The Tories’ forecast became reality: the “big six” firms, which control 90 per cent of the energy supplying market, increased their prices by an average of nine per cent in average.
Cameron reacted with predictable hypocrisy. After the first of the “big six” raised its price, he urged the “hardworking people” to find cheaper options rather than passively accept an increase in the cost of living! Now, when all of them have done the same, he wants to roll back the “green charges” claiming they are driving the energy bills up. The problem is that his government has always insisted the “green charges” would help cut energy bills in the long run. Has he forgotten his own assertions?
In response, Miliband merely says that Cameron is not forcing the energy suppliers to freeze prices and that “27 million families would benefit from Labour’s price freeze”. But “would benefit” is very different from “is benefiting”, and he makes it clear that Labour are not going to do anything to stop rising bills now. It is, after all, a tactic to win labour votes.
The Ipsos Mori poll shows that 36 per cent are satisfied with Miliband’s leadership, an improvement on September’s 24 per cent. But Miliband’s boost has not helped Labour; they are tied with the Tories on 35 per cent. So, we await further false promises from now until the general election.
The fuel poverty
One in four UK households now live in fuel poverty, that is more than five million. Fuel-poor households will have to spend, on average, £450 more on fuel, 50 per cent more than they can afford. On average households spend £9 a week on fuel bills in the summer, but it can jump to over £30 in the winter months.
Since 2004, according to the government, fuel poverty is getting worse. The Energy Conservation Act 2000 was meant to prevent it, but since 2008-09 the funds for Warm Front, the primary policy on energy efficiency, has been cut.
But there is no lack of money. Since 2004 VAT income from energy bills has risen by at least £1bn a year, and sales of carbon emission permits, required by the energy firms, bring in a further £4bn a year for the Treasury. This could be used to end fuel poverty and alleviate the hard choice that poor households have to make between heating and eating, and leading to an appalling increase in the numbers using food banks. But the government preference is to use that money to bail out the banks, through quantitative easing or to fund private business, such as the Help to Buyprogramme or public-private partnerships (PPP).
Lower prices now and nationalise the energy sector
It’s easy to see that Miliband’s pledge cannot solve any of the problems that afflict the population. First, because it’s only a promise for 2015, second, it’s a temporary and not permanent freeze of prices and, lastly, it won’t resolve the problem of fuel poverty that already exists.
What the English working class and the poor need is an immediate reduction in energy prices to an affordable level for everyone, investment of tax income in the Warm Front programme to end fuel poverty; and, which is linked, food subsidies so that poor families do not have to resort to the degradation of food banks.
What we do know that this cannot be done while the “big six” control energy. Giving money to the capitalists, while waiting for a social return is like putting Dracula in charge of the blood bank.
The only way out for this situation is the nationalisation, without compensation and under workers’ control, of the entire energy sector – from production to supply.
Nationalisation is supported by 69 per cent of the population, but this will never be a Labour campaign promise. It can only be achieved by the organized struggle of the working class – native and immigrant, communities and oppressed sectors, which is everything the Labour and their aides – the TUC and union bureaucracy – don’t want to happen.