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So he is saying when he wins the next election,(no chance for him, probably a very good chance for labour) he is going to ensure the privately owned and run energy companies are not going to increase the prices of energy to us plebs.
and just how is that going to happen, perhaps make all bike shops not increase the price of inner tubes would be easier. and a lot cheaper.
and neither is going to work in reality, without huge subsidies to shareholders, most of whom are foreign
FREE BEER FOR EVERYONE!
I'm voting for baby!
Drug testing should be extended to politicians.
and just how is that going to happen
Simple, they pass a law to make it happen. Good old fashioned state enforced price controls, probably done through the regulator. I'm not saying I agree BTW, but the mechanism for doing it would be pretty straightforward I would think.
I suspect he will do it through the new regulator he plans to set up
which will have to get thru parliament so its not that likely it will, in which case he can just blame the torries for blocking it
besides which its just an election pledge*
*see clegg and university fees
also cameron and protecting the NHS
which will have to get thru parliament so its not that likely it will, in which case he can just blame the torries for blocking it
Except that he'll have a majority, so it should be no problem?
Price controls of essential privatised services are hardly a new concept, I think they may already exist in law, but successive governments have been rather weak in applying them.
do ofgen not alread regulate prices to an extent and the rail regulator set maximum price rises for train fares
he also included some wriggle room saying that in exceptional circumstances (eg wholesale energy price upheaval) they could still raise them
Its a shot across the bows innit? I doubt it'd be legal to do it, even if it was do-able.
But what it does do is send a long, long overdue message to not just the energy companies, but also the other privatised [s]utilities[/s] monopolies, who've gleefully been bending us all over for years, that the decades of doing whatever they bloody well feel like, with absolutely zero regulation, oversight or sanction may be coming to an end
Here's hoping eh? It is refreshing for someone to finally challenge the neo-liberal consensus that 'competition' is a panacia to everything, as in reality it doesn't actually exist in anything but name in our supposed capitalist utopia
The prices for rail fares (another privatised failed market) are regulated to this degree (and could be forced down under the current system if there was a will for it) the suggestion that it would be illegal or impossible for a government to do this seem misguided at best.
I thought any attempt to stop private monopolies charging whatever they like tended to fall foul of EU competition law
I thought any attempt to stop private monopolies charging whatever they like tended to fall foul of EU competition law
Water prices are regulated by OFWAT.
He has no chance of being elected in 2015. These pledges and policies are merely camouflage so that he can turn to the dissidents in his party fter the GE and say "[i]see - I told you all this left-wing stuff would never work[/i]". Labour and Torys will then go head-to-head to see who can win the most right-wing (i.e. the majority of the UK voting public) votes for the following GE.
one day binners, one day
these are just the sort of controls that shouldve been put in place when the utilities were being sold off
and it turns out Milliband has Balls! not just Ed but real testicular fortitude
he told murdoch to eff off (whatever he did the sun and times were never going to stop attacking him anyway) in a way no UK party leader has told that aussie arse to, ever!
he stood up to David Cameron (and Obama?) over Syria
hes even stood up to the unions and could change the face of labour and party funding forever
and now hes attacking the energy cartels
The policy is so well thought out that even Chukka Ummuna struggled with it on Newsnight last night.
But we still face serious economic and social headwinds in the UK and so far we have had two party conference (three if UKIP counts for anything!) and what serious proposals have we had? De nada....
The LibDems - err, we have done the job of avoiding/moderating Tory excesses. Please vote for us and we will govern with whoever.
Labour's big moment and we get: price controls, shuffling business rates, land banks, bedroom tax (sic) and breakfast clubs. FFS, when will we get away from he politics of focus groups and talk about the real issues facing the UK. I pity the news and newspaper editors trying to make stories from yesterday. Paxman was positively bored. It is seriously depressing when that is the the best an opposition party can come up with.
So now we await the Tories. So who will be the conference wrecker (a la Cable, Bloom, McBride) and what focus group will they try to please? Here's hoping for something a little more profound but probably likely waiting for Godot.
Must be a different Miliband
“We are going to have to see significant infrastructure built in the coming years. We have to understand people's concerns and where they’re coming from but to say no to all of these things isn’t an option because it will be bad for Britain in terms of our security of supply and it’s bad in terms of low carbon as well.”
Give him some credit for trying! But if this is the flagship 'left wing' policy to camouflage the NuLab-Lite then I doubt if it will do him any good.
Scotroutes - interesting points about RW v LW and the positioning of the labour party. Milliband is setting out his target groups clearly in the middle to LW ground (although he avoided the 70s terminology of price controls!). And there is some strategic sense in that given the fact that the economy recovery is not being felt evenly in terms of wages, jobs etc. So all perfectly sensible politics there as in the public's eyes Labour have lost the historic economic debate. But what is the middle ground? Not the ONS's £24k income households. No, even the £60k earners are not "rich". No wonder the low income earners feel disenfranchised when Reeves sets out the economic stall at these levels.
thm you know you are misquoting reeves- she said 2 earners on a combined income of 50-60 in the SE dont feel rich
IMO, that was deliberately left open to interpretation (for political reasons) but nevertheless as was stated on the other thread the message is clear in terms of where Labour are focused. The squeezed middle is the front line rather than traditional Labour voters.
Labour's big moment and we get: price controls, shuffling business rates, land banks, bedroom tax (sic) and breakfast clubs. FFS, when will we get away from he politics of focus groups and talk about the real issues facing the UK.
I'm not usually one to defend the labour party or Ed Miliband, but what 'real' issues would you like them to talk about? Falling living standards for everyone other than the very top, blatantly unfair and punitive benefits changes, and the back-door privatisation of the last remaining public services seem pretty real to me. I for one actually think they're on the right track with a lot of this, although as always they'll probably water it down in the face of tory attacks and a rightwing media frenzy.
But Milliband was 100% correct in the point that he made repeatedly - Britain CAN do better than this - surely, hopefully?!? 😉
The UK has amongst the lowest per unit domestic retail energy costs in Western Europe (of the main countries, only France is lower, because they invested heavily in nuclear). The UK has more competition in its energy supply market than most, leading to efficient supply chains and low margins.
Look at the figures yourself: http://www.energy.eu
The cartels lie outside of our control in Russia and OPEC.
Lets also remember that the government takes far more in tax and VAT from domestic energy supplies than the power companies make in profit!
FFS, when will we get away from he politics of focus groups and talk about the real issues facing the UK.
THM - to be fair, Business rates is a very serious issue*. Businesses - shops, pubs, etc are paying rates calculated on the pre-crash incomes of 2007.
How many shops, bars and cafes (metropolitan Utopia of London excepted) are turning over anything like the income needed to pay rates that were calculated at the height of the boom. Its a major reason loads of shops, pubs etc have gone to the wall in recent years. And will continue to do so at a rate of knots until something changes!
* Not to the real 'Wealth Creators' in The City, obviously. But meanwhile, back in the real world....
The UK has amongst the lowest per unit domestic retail energy costs in Western Europe (of the main countries, only France is lower, because they invested heavily in nuclear). The UK has more competition in its energy supply market than most, leading to efficient supply chains and low margins.
UK prices are low because UK energy tax is low. It's nothing to do with the efficiency of the market.
ninfan is that not because the UK generates more of its own energy and gets more from renewables than the rest of europe?
Its complete bluster, unenforceable, will never happen and is a waste of the publics time considering it. Shamefully the same bull**** that seems to keep erupting from Labours mouths at the moment.
Similar crap was spouted by Ed Balls earlier in the week about HS2, playing to the knee-jerk crowd with absolutly 0% commitment about what they will do.
get off the fence LHS 😉
Similar crap was spouted by Ed Balls earlier in the week about HS2, playing to the knee-jerk crowd with absolutly 0% commitment about what they will do.
Funny how people have such short memories. I seem to remember a couple of years before the last election the main criticism of Cameron and the tories by the Labour party was that they didn't have any policies. Now it's exactly the same but the roles are reversed. It's pretty ridiculous.
🙂
Aye fix prices for two years - that'll work just fine! Energy companies will just whack up rates a month before the freeze and straight away afterwards.
The only sensible thing he said on 'Breakfast' this morning was to stop big companies sitting on land and doing nothing with it. Basic proposal was 'develop it or face compulsory purchase'.
But this should also applies to Councils. Our local town has loads of council owned land that is doing sod-all. All we keep getting are proposals of future development, but nothing happens!
The guy is a joke, he should be providing incentives for the power companies to build a power and supply system fit for purpose and one that is not reliant on ancient old power stations,. But no instead he wants to reduce their ability to do so.
Why not take money from say the supermarkets instead, where there is even less competition.
You seriously think the energy companies are more competitive than supermarkets? 😯
They're all cartels! To varying degrees. The privatised utilities are all essentially operated as extremely profitable monopolies, who when it comes to actually investing in anything, other than dividends for shareholders, or executive bonuses, comes cap-in-hand to the government looking for taxpayer subsidies
Which is exactly why someone needs to point it out and do something about it
Binners - I agree that business rates are a challenge and an issue. Are they in the top 5 pressing issues facing the UK? Debatable. What irritates me (as an economist!) is that yesterday was merely a (weak?) exercise in poltical positioning. * Labour are re-positioning themselves around a "cost-of-living" strategy rather than "the Tories are destroying the economy" argument previously. Politically that makes some sense albeit it is risky given the shallowness of what has been proposed so far. But in terms of making the UK recovery more secure, I think the sugar rush of focus group politics quickly wears off.
Balls to his credit was at least more honest and realistic.
* edit to be fair, that is one of the purposes of a party conference and in that sense, Millband has made a reasonable fist of setting out Labour's political stall.
But what is the middle ground?
problem is each party has its core vote who wont jump ship to the other side and this draws watch party towards some sort of hegemony where they fight for the middle ground and the floating voter
I blame the lack of PR and democracy tbh.
See also Camerons issue with trying to do this whilst keeping the loons and closet racists voting for him rather than UKIP.
It is quite easily enforceable and I dont see what is wrong with Balls going we will evaluate the HS 2 but we aint writing a blank cheque.
Seems reasonable - its not like i have to commit to an extension of my house in 4 years time with no knowledge of what it will cost or whether I need it.
You seriously think the energy companies are more competitive than supermarkets?
It's on Daily Politics at the moment.
Some Labour politician telling Andrew Neil that power companies make 'huge profits', but he doesn't know how much. Andrew Neil pointed out the company that he'd been quoting as the worst offender makes a lower ROI than Tescos.
Andrew then suggested a freeze on food prices. This was apparently ridiculous.
Right.
thm - I don't think any of the political parties have the balls to address the real issues facing us all. ie: the present capitalist system is a busted flush, doomed to forever repeat the boom/bust process, but with increasing bust, after far far less boom. There's none of them would dare to suggest that the whole countries economy needs to be fundamentally restructured. Because then they'd have to suggest how that was going to happen
We'll not hear anything about that next week either. Though at least the labour party don't seem in such a rush to inflate another housing/credit bubble, then call it an economic recovery
A genuine question for Labour members - before the speech yesterday, would you have imagined that the single most important initiative that your party would propose would be a two year price control on energy? Was that top of anyone's list?
JY - I agree on Balls and HS2 (but I also have a vested interest there!!!!)
You seriously think the energy companies are more competitive than supermarkets?
What is an acceptable profit to make on retail energy? IIRC SSE, one of the big six make about 5%, a lot smaller than the profits made by Tesco on food. Clothes are also essential, should the price of pants and socks be set by the government?
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The bizarre thing next week will be Osbourne trying to pretend that he did actually implement Plan A. The actually policy was much closer to Balls' Plan B all along. (check out the purple ties next week)
As for capitalist system - which part of the main policy instrument (whereby risk is deliberately mis-priced by the state in order to force people to make incorrect economic decisions) would be found in a capitalist text book?
I think the free childcare thing is a bigger issue and will benefit the economoy a lot more than the energy price pledge
also the 2000000 homes thing and fining developers for holding on to land was a bigger announcement would love to see the housing crisis sorted
What is an acceptable profit to make on retail energy? IIRC SSE, one of the big six make about 5%, a lot smaller than the profits made by Tesco on food.
It's a bit silly trying to compare supermarkets and energy companies. Energy companies sell one product and rely on a common infrastructure to deliver it, hence the opportunity for price fixing and profiteering is much greater than a supermarket and so requires regulation to prevent it. You can't compare this to a supermarket industry which has completely independent operations selling thousands of products.
Nationalise the lot that would cause a bit of consternation and I dare say some kind of armed revolution. Trouble is the masses are to drugged by X Factor and the like the actually stand up and say no to the type of crap we have been force fed for years.
Revolution Revolution Revolution but start after I have had my tea 😉
Going to declare an interest here, as I work for E.ON. We make 2.3% profit on your gas and electric bills. £2.30 in every £100.00 or just over £32.00 if you are paying about £1400.00 per year.
I'm pretty sure there's not a lot of large business sectors that take such a small percentage. A large proportion of your bill goes towards environmental protection measures, (wind farms, insulation of homes) social support and distribution, all of which are mandated by the government.
And since when has the choice of 6, (large) suppliers been considered a monopoly? No-one complained too much about this "broken" market for years while energy prices were low did they?
edit - And the reason for our creaking infrastructure and lack of investment is primarily because the govenment hasn't developed a coherent energy policy for years.
Tthew - and you noticed how no one talked about ROI or ROCE only profits? Funny that? Chukka was also stunned when asked to comment on future trends in global energy prices!!!
THM - it's the chapter after 'using taxpayers money to bail out bankrupt banks' 😉
Different book again Binners!
would you have imagined that the single most important initiative that your party would propose would be a two year price control on energy? Was that top of anyone's list?
Nope not in our* wildest dreams could we imagine Ed would actually have an initiative let alone an important or a well thought out and useful one
(check out the purple ties next week
I cannot work out if you are toying with us or you know a secret from the Illuminatti!
* I am not technically a labour supporter as I am actually left wing
If he was so worried about the rising living costs then he could have removed the tax on energy, but then that would mean a loss of money for the government, so not a cat in hell chance he'll go for that.
This is the deal breaker for me http://www.bbc.co.uk/news/uk-politics-24218329
I definitely won't be voting Labour.
Fill up already crowded areas with more houses, expand the existing towns, don't worry about the roads. Gridlock.
Scary.
Going to declare an interest here, as I work for E.ON. We make 2.3% profit on your gas and electric bills. £2.30 in every £100.00 or just over £32.00 if you are paying about £1400.00 per year.
[img] http://www.cyclechat.net/attachments/gas-prices-retail-v-whole-001-jpg.29863/ [/img]
This is the deal breaker for me http://www.bbc.co.uk/news/uk-politics-24218329
I definitely won't be voting Labour.
Fill up already crowded areas with more houses, expand the existing towns, don't worry about the roads. Gridlock.
Scary.
I don't they're proposing more people, just more houses.
Does anyone actually beleive what any politician (whatever party they represent) says when they're trying to get elected?
They all sound like they're lying and look like they're dreaming.
Outside of the whole debate of what is or isn't right as an acceptable margin for a company to make, what will the implication be for share values if some kind of fix is put in place?
If share values drop, that in turn would potentially affect the value of pension funds that are corporate investors in the energy companies. How would the people who are saying renationalise or regulate feel if that course of action sliced their pension pot?
It goes a lot deeper than some simple "fat cat making massive profits" argument.
DezB - Member
This is the deal breaker for me http://www.bbc.co.uk/news/uk-politics-24218329
I definitely won't be voting Labour.
thats actually a vote winner for me
Aren't a lot of the privatised utilities now in the hands of private equity anyway? So overall I doubt the impact on pension funds will be significant anyway
This is the deal breaker for me http://www.bbc.co.uk/news/uk-politics-24218329
Is this just outright nimbyism or are you thinking about your buy-to-let investments? I can't for the life of me think how, in the midst of a major housing shortage, anyone could think that building more houses is a bad thing.
Sticking new houses in already existing urban areas is a good idea for transport of goods and people too, public tranposrt (in private hands) is viable in these locations, there are likley to be jobs locally, walking and cycling can be encouraged. It's all good (assuming the appropriate legal agreements are in place to provide suitable amenities as well).
Oh Dezzy baby.....
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Aren't a lot of the privatised utilities now in the hands of private equity anyway? So overall I doubt the impact on pension funds will be significant anyway
Er, where do you think the PE funds get their investments from? Yep, they include institutional investors....
On the face of it, he's pitched this roughly in the right place: on the side of you and me, rather than "big business". It's a differentiator to challenge the Tories.
However, it feels frustrating that, in order to assess whether this is really a workable policy, we're all going to have to do due diligence on the big energy companies to review their EBITDA and determine what proportion comes from retail gas and electricity, and what comes from all the other things they do.
centrica -4.9% today
If share values drop, that in turn would potentially affect the value of pension funds that are corporate investors in the energy companies. How would the people who are saying renationalise or regulate feel if that course of action sliced their pension pot?
Well the pension funds only hold about 6% of the value of the stock market. Maybe we could actually increase that if we didn't have to blow so much of our monthly wedge on energy.
Same goes for building new houses if we can start pushing down house prices maybe the next generation won't be so trapped by the monthly mortgage payment.
It's not the strongest idea really is it? It's a bit worrying that it seems to be being presented as a flagship policy...
The whole UK economy is facing strong headwinds in terms of current and future sources of growth. We're fighting to adjust to globalisation and the increased competition and change in balance of power this is bringing, capitalism clearly needs closer management to tame the swing from boom and bust...
The Tories are not exactly showering themselves with glory in what is supposed to be their strength - managing the economy...
And this is the strongest reason Milliband has given so far to convince us to vote labour...
My monthly outgoings are c£2.5k. The main component of that is my rent at £1k. My gas and electricity combined is £50... so holding down energy prices will save me what, £10-20 at most? I could save that my going out one night less a month...
So even as a populist vote winner it's hardly the strongest idea is it?
The mind boggles about the discussions these guys are having about how to deliver stable economic growth and stable living standards...
"Same goes for building new houses if we can start pushing down house prices maybe the next generation won't be so trapped by the monthly mortgage payment."
lol
You forget one incey wincey little thing....
People.... all people.... every single man jack one of us.... are greedy.
People will always try to better themselves... and thank goodness for that... otherwise we'd still be living in caves.
And if that was the case, guess we would have to worry about iphones/home entertainment/pouncy watches/stupid big cars... or heaven forbid... a bike for p1ssing about in the woods on ... let alone those big mortgage you are worried about.
brooses
This isnt Labours only announcement, its the one the press and in particular the tory press have picked up on and run with
the new home building plan has the potential to seriously affect the housing crisis and lower your rent
MILLIBRANDS lost the plot
I wasn't aware he had a plot to lose.
Frankly I'd prefer another 4 years of the current bunch of incompetents compared to Millibrand.
My monthly outgoings are c£2.5k. The main component of that is my rent at £1k. My gas and electricity combined is £50... so holding down energy prices will save me what, £10-20 at most? I could save that my going out one night less a month...
Lucky you. There are lots of people out there who go hungry so they can keep the lights and the heating on.
A fair point Kimbers. Everyone's on about the price freeze. But he also said he was going to break the big 6 energy companies up (god knows how!), which I would have thought had far more long term implications for the energy market, re: long term investment and pricing
And I really can't see how you could be too bothered about building new houses, unless you're a baby boomer presently using your house (well... its equity) as a cash machine to pay for shiny things and holidays, and are dependent on maintaining the present ludicrously unsustainable pricing, and constant above inflation increases
Kimbers - (to be fair) front page of The Labour Party website today is a summary of Ed's speech. And the first policy annncement is freezing energy prices. So hardly a conspiracy to highlight that this was positioned as the flagship policy and/or one of the top 5 policy initiatives.
Binners - on your favourite topic of the housing market, it is another funny aspect of the capitalist (?!?!) system that we (apparently) live in, [b]that taxpayers money is used to help first time owners buy over-priced properties[/b]. That seems to be another missing chapter!! You couldn't make it up.
I think the biggest thing that the media have ignored (probably cos it's a vote winner) is the childcare announcement. That's going to save a lot of people a lot of money, and a huge amount of hassle, and will be a huge vote winner assuming the tories don't steal it.
Indeed thm - the present taxpayer funded help-to-buy nonsense was described by an EU finance minister as the most insane economic policy he'd ever seen. And he's probably seen a few.
Lets set up the perfect conditions for the next credit fuelled bubble, and subsequent crash, shall we? But how could we make it far worse this time around? Hmmmmmmmm.... we could put the taxpayer directly on the hook for the losses. Brilliant!!!!
In the face of Osbournes answer to the housing crisis, Millibands policy looks like the very model of common sense, and I don't know anyone but the most incredibly stupid or terminally self-interested (both?), could argue for the status quo, with a straight face
And I really can't see how you could be too bothered about building new houses, unless you're a baby boomer presently using your house (well... its equity) as a cash machine to pay for shiny things and holidays, and are dependent on maintaining the present ludicrously unsustainable pricing, and constant above inflation increases
Guess it depends on how far you think they can take this policy … one day confiscating privately owned land bank… (most of which is down here by the way….. there’s been little point in house builders owning land up by you, where most of unused land is council owned ) … the next, forcing second home owners to sell up…. and then finally, making you rent out your spare room.
[i]Is this just outright nimbyism or are you thinking about your buy-to-let investments? I can't for the life of me think how, in the midst of a major housing shortage, anyone could think that building more houses is a bad thing.[/i]
Well, you northerners don't live in the overcrowded south where they take already overcrowded towns and expand them. They are not catering for people who live in the area - they are attracting new people to move into the area.
And I'm far far removed from any of the "baby boomer' 'buy-to-let' owner or any other of the bollocks spouted.
The childcare thing will also be good for the economy getting people back to work quicker and improving education standards too
"In the face of Osbournes answer to the housing crisis, Millibands policy looks like the very model of common sense, and I don't know anyone but the most incredibly stupid or terminally self-interested (both?), could argue for the status quo, with a straight face "
Strangely enough, it turns out that the developers are not evil capitalists, intent on making "hard-working families" suffer by denying them somewhere to live. Amazingly, they actually want to build houses, cos that's what they do. But, they can't build them unless they are confident someone can afford to buy them. So what is needed is a "help to buy" scheme. Oh, hang on, we've got one of those already. And look, it's working: "Over the 12 months to June 2013, housing starts rose 7% to 110,530 compared with the year before."
[i]walking and cycling can be encouraged[/i]
Evidence that you don't think about the real world. People don't walk to work. 99% of people don't cycle to work and wouldn't even if they could.
[i]So what is needed is a "help to buy" scheme.[/i]
Yeah, I was looking at help-to-buy scheme houses. They are the ones that are priced £20K over the local pricing to take advantage of the scheme, yeah?