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Agree but he at least appeared to grasp the scale of the crisis, comparing it to 2008, which is exactly what it is, or probably worse
Yeah and as much as I don't really like him that much - people who go on about him selling all the gold FFS (not really a problem derisking government assets) want their heads banging when he did so much to support the economy.
Why nationalise any existing energy retailer?
I'm guessing they've got continuation on the billing systems but I really don't know.
And besides aren't you nationalising the market rather than the suppliers?
I don't know.
I need to read the TUC paper in full. Have you seen it?
I didn’t vote Labour when Brown was PM… hard to argue that the UK economy and society would not be in a better place if we’d voted him back into Downing Street. I was wrong then.
EDIT: Consider carefully about who might be wrong now… those critical of Labour not being radical enough, or those comparing them to the alternative government the Tories will offer and the damage they will do. Get the Tories out, even if it feels too small a step to you (or for me)… it’ll be a huge step in the right direction for the country as a whole.
Agreed.
The way he came to power never seemed right to me but that's by the by.
The thing with energy though is there’s no real reason to re-privatise after nationalisation like there was with the banks.
You would think. But they did with British energy.
They've also done it with the East Coast Main Line. Several times.
I realise the latter isn't the point you were making but thought it relevant nonetheless.
If we were still building nuclear as national infrastructure we could have had stations coming online if not up and running before now. No, I know its not everyone's cup of tea but again, still worth saying. We could be derisked by about 11+GW and have something to replace the 8+GW we'll be losing in the next few years (in the last 8 months we've lost just over 2GW with the shutting down of Hunterston B and Hinkley Point B).
To fair I thought everything was going to totally fall apart in 2010
I thought economic collapse and depression were nailed on in autumn 2008. But then they nationalised the banks at the cost of about a trillion. I thought the same in 2020 when covid hit, and they spent 500 billion propping up businesses and paying peoples wages.
Now we have a similar existential threat to the economy and they’re talking about spending 30 billion or less! Maybe I’m being alarmist (I hope) but this seems like a crisis on the same scale, but with none of the political urgency we saw in 2008 and 2020.
I think the clock started ticking for the Tories on Monday, the polls that were mentioned reflect how the country felt last week but I bet they look different by the end of this week.
The timing of the next energy price hike is the 26th August. The new leader won't be announced until the 3rd September. What a week that's going to be for the Government.
Sticking my neck out here but given that most people are expecting some form of unrest or protest it could coalesce around demands for a general election during the period between those two dates.
The country could down tools for the whole week and turn out to protest like Craig David, (Friday Saturday and Sunday, Monday Tuesday etc etc.)
Better than waiting for the riots to kick off in a few months time.
Just a thought...
Notting Hill Carnival starts on the 27th of August...
Anyone remember that scene from 'The Death of Stalin' where Kruschev says to Zukov; "Why tomorrow?" and Zukov replies "You mean when the whole ****in army's in town?
Also reminds me of when Cameron called an EU membership referendum smack bang in the middle of the European Football Championships.
Speaking as an ex events promoter, I always tried to avoid potential clashes when doing the scheduling.
Now we have a similar existential threat to the economy and they’re talking about spending 30 billion or less! Maybe I’m being alarmist (I hope) but this seems like a crisis on the same scale, but with none of the political urgency we saw in 2008 and 2020.
I guess at some point someone has to do something solid or it will become part of a huge chain reaction.
There's almost certainly a tipping point, and with summer behind us we will reach that very soon.
Again the fact the neoliberal framework has appeared to deliver the goods (the debt and poverty) means everyone is clinging to it and not seeing the big picture.
The USA are sticking some support packages in and Japan is doing okay on Q/E (Japan didn't stop on the support straight after COVID) and have got their economy growing. No whinging about public debt & they appear to be using the tools better than us.
No suprises.
I'm a trustee of a charity whose electricity bill will rise from
£8k in 2019
to
£50k in 2023.
That sounded so remarkable that I doubted that it was even true.
I have just discovered that the Ofgem cap doesn't apply to non-domestic customers (I didn't know that) so the energy suppliers are making up for the shortfall caused by the Ofgem cap by passing it on the non-domestic users.
Therefore Starmer's very limited proposal of freezing energy bills at 54% more than they were last winter for 6 months won't help public service providers just hospitals and schools in any way at all.
Truly grim.
Businesses, hospitals, schools need a Labour government to hugely increase our supply of renewables. And they all need to be freed from the damaging policies of this Tory government. Oh, all except the likes of BP and Shell... they need us to keep letting the Tories win...
Labour's energy policy isn't just this short term freeze for households this winter. Come the next general election, the choice as regards our energy generation and conservation will be stark.
I have just discovered that the Ofgem cap doesn’t apply to non-domestic customers
I don’t think you’re the only one. I didn’t realise the impact until I saw that chippy energy bill for 10k (up from 1200) doing the rounds. Then the penny dropped that all small businesses which use lots of energy are screwed. Restaurants, pubs, cafes, takeaways, workshops, micro-breweries, bakeries etc will all be shutting up shop very soon either temporarily or permanently and dumping millions on the dole. I’m beginning to think it’s a deliberate policy to solve the workforce crisis. Grim isn’t the word, it’s nothing short of cataclysmic.
Uk data centres too considering how much energy they will use. Which means online retailers and other online services will push up prices 😔
Restaurants, pubs, cafes, takeaways, workshops, micro-breweries, bakeries etc will all be shutting up shop very soon either temporarily or permanently and dumping millions on the dole. I’m beginning to think it’s a deliberate policy to solve the workforce crisis. Grim isn’t the word, it’s nothing short of cataclysmic.
Lets have a think about it after the summer holidays- no rush
I have just discovered that the Ofgem cap doesn’t apply to non-domestic customers (I didn’t know that)
It also doesn't apply to schools, hospitals and communal domestic heating systems. So people in council flats with a boiler in the basement are being completely screwed.
By far the most important argument put forward at the time of privatisation was that the private sector tends to run businesses more efficiently because of the profit motive, resulting in cheaper prices for consumers.
35 years on electricity prices have increased by a third in real terms and gas by half (pre-present crises)
Privatisation has therefore failed in its main primary stated aim of reducing prices for consumers. Although the incalculable £billions in profits obviously means that the profit motive bit of the argument has turned out to be entirely true.
At what point do the right-wing Blairites in the Labour Party stop supporting a failed policy which they themselves opposed when it was introduced 35 years ago?
We know that Labour Party members overwhelmingly support the common ownership of energy which is why when Starmer stood to be Leader of the Party he felt obliged to publicly declare :
"Public services should be in public hands, not making profits for shareholders. Support common ownership of rail, mail, energy and water"
And we know that the UK public, including Tory voters, support the nationalisation of gas and electricity, even before the current crisis.
Why therefore doesn't Starmer? It genuinely puzzles me. I accept that he is timid and doesn't want to be labelled a communist by the Daily Mail or the Sun but surely it must be more than just that? He is rejecting a policy which is more than ever both popular with voters and actually makes sense.
The only reason the Tories won't nationalise gas and electricity is obviously for idealogical reasons** and the need to satisfy greedy privateers.
So bearing in mind that Starmer doesn't have any ideological commitments and only the commitment he actually has is to get himself into Number 10 what is his reasons?
** Although even the Tories, at least under Johnson, accept that sometimes they have limited choices:
Therefore Starmer’s very limited proposal of freezing energy bills at 54% more than they were last winter for 6 months won’t help public service providers just hospitals and schools in any way at all.
Massive oversight - especially the state element of energy users.
By far the most important argument put forward at the time of privatisation
My recollection of it at the time was that it would create a "shareholding nation" ("Tell Sid when you see him" the marketing campaign for gas/electric was more or less a catchphrase used even by schoolkids at the time) in the same vein that council home sell off created a "house-owning nation" The efficiency argument was secondary to that. It was sold to people that they'd have a direct stake that would earn them an actual return rather than a nominal stake in a nationalised industry that they "owned" as a citizen and was a cost as a tax rather than a benefit of a shareholder.
Price rises (certainly the ones we're seeing now) are largely effected by events without our borders and have less to do with whether they're efficient or inefficient, private or nationalised.
Why therefore doesn’t Starmer? It genuinely puzzles me. I accept that he is timid and doesn’t want to be labelled a communist by the Daily Mail or the Sun but surely it must be more than just that? He is rejecting a policy which is more than ever both popular with voters and actually makes sense.
Classical economics is wedded to the current market system. And the main political parties are advised by classical economists that believe the private sector generates wealth on its own, and corrects its own problems.
The fact is the Tory government did so well with neoliberalism (for the asset class) because they had so much to strip and privatise back in the 1980s.
Reverse Robin Hood!
That's the countries wealth being taken apart and served up to the few.
That tap is now running dry (along with scarcity) and the morons in charge have not realised you have to have a source of wealth in the first place. That source is the state.
So it's a simple case you have to turn the tap on to redirect the water to where the garden needs it the most.
Starmer and co daren't turn that tap up - only meddle with the hose.
Corbyn's base economics would have made the difference here and been ahead of the curve. (Despite tax and spend fully costed nonsense.)
My only thoughts are how bad does it have to get?
I think winter will be interesting from an economic point of view. Again you put stuff in place before it happens.
Price rises (certainly the ones we’re seeing now) are largely effected by events without our borders and have less to do with whether they’re efficient or inefficient, private or nationalised.
Starmer wants to spend more on propping them up in the short-term than nationalisation would cost.
That in itself is grossly inefficient.
Yes and he spouts the bollocks about "every penny going to reduce bills rather than compensating the shareholders"
It's dishonest.
did listen to Brown talking and although his sentiment was there he barely scratched the surface of what to do
He has history...
1997-Abolished ACT and took another chunk out of the UK pensions system (TBF Lamont took a chunk in 1993)
2001-Changed vehicle taxation to promote diesel/diesel cars to protect the environment by lowering CO2 emissions, but harmed humans by increasing NO2, N2O and plain NO as well as particulates
"Light-touch" banking regulation in the run up to the 2008 crisis
Failure of his Chancellorship and later PM-ship to push to renew nuclear energy
But the sentiment was there...
Efficiency differences are nonsense as the same set of people are doing the same jobs (i.e. a finite group of people at all levels within org with the skills/knowledge/training)
It is all about the money and who gets it and how much is spent with profit as the main objective when privatised and direct cost to the consumer as the main objective when nationalised.
Starmer wants to spend more on propping them up in the short-term than nationalisation would cost.
Yeah, and he's also had the energy shadow say that they've pretty much ruled out privatization as too expensive* I can see the political problem he faces. If Labour Privatize: Spend the public's money, and U-turn on previous statements. He's stuck
*I know it's popular as a policy, but the cost is largely undiscussed in those sorts of polls, and I think will be the thing that will sway the public either way, especially in the current climate.
Starmer wants to spend more on propping them up in the short-term than nationalisation would cost.
And? The cost of keeping bills down is still there if you nationalise. Nationalisation would be an additional cost, not instead of the cost of fixing prices for this winter.
That in itself is grossly inefficient.
The comparison is a dud. I’m all for full nationalisation of energy supply, distribution and generation, but claiming you can buy just the energy retailers on the cheap now, and that would in itself solve this winter’s energy crisis, is a false hope. There are just the shop front, not the means of production.
And? The cost of keeping bills down is still there if you nationalise. Nationalisation would be an additional cost, not instead of the cost of fixing prices for this winter
You're simply not thinking long term then.
1) One monopoly purchaser could secure a better price from the wholesaler.
2) You can subsidise bills more effectively without the issues associated with privatisation when in state hands.
3) state gains an asset with nationalisation so real cost is nominal.
4) efficiency gains by having one supplier has got to be better than several that can't stay solvent. There's nothing efficient about using government money keeping a private organisation afloat because it's got a profit demand on it.
The propping up method is a dud but just about better than nothing.
The comparison is a dud. I’m all for full nationalisation of energy supply, distribution and generation, but claiming you can buy just the energy retailers on the cheap now, and that would in itself solve this winter’s energy crisis, is a false hope. There are just the shop front, not the means of production.
You can do both - subsidise bills and demand a better rate with one state supplier
The short term approach offers no answer beyond this winter.
The scope of Starmer's plan is too small and *expensive* relative to a long term solution.
If Labour Privatize: Spend the public’s money, and U-turn on previous statements. He’s stuck
Take the U-turn.
There are good ones and bad ones.
This is a good one.
You can subsidise bills more effectively without the issues associated with privatisation when in state hands.
Isn't EDF - more or less wholly owned by the French Govt, currently suing the French govt for E8.9B?
Isn’t EDF – more or less wholly owned by the French Govt, currently suing the French govt for E8.9B?
Yes, though good luck with that I guess - in the meantime the public enjoy reasonable bills, and a state asset.
Price rises (certainly the ones we’re seeing now) are largely effected by events without our borders and have less to do with whether they’re efficient or inefficient, private or nationalised.
I was specifically referring to the last 35 years before the current crises:
"35 years on electricity prices have increased by a third in real terms and gas by half (pre-present crises)"
Have we had 35 years of unfortunate events? To be fair there was a slight drop in electricity and gas prices in the first 5 years after privatisation.
Although I wouldn't be surprised if that was connected to massive pre-privatisation government investment which the Tories like to oversee - it is unlikely to be because privatisation is so efficient that within months prices fell.
Or the even more likely the government deliberately put up prices prior to privatisation to make the whole package more juicy and attractive.
I agree that the virtues of being a “shareholding nation" were sold at the time by the Tories**, but I still maintain the principal benefit of privatisation was claimed to be that it would lead to greater efficiency and therefore lower prices for consumers.
What has actually happened is the reverse. Unsurprisingly.
** And they certainly didn't tout the virtues of millions of consumers paying their electricity bills to a state-owned foreign company. Unsurprisingly.
Also the government are paying 2 billion to bulb currently for what exactly?
I don't see the gain here.
No, electricity produced by burning coal 35 years ago was cheaper than production methods now but unacceptably polluting
There was an article a couple of days ago in the Guardian about the Water privatization by Jonathan Portes
In it he argues that: We knew what was going on, because water privatisation was never really about efficiency. In the short term, the overriding political priority was a “successful” sale – one where demand for shares was high – and where those who applied and who had, from previous privatisations, already come to expect a large premium.
He even says that while it was overwhelmingly unpopular at the time, it was also oversubscribed by 6 times.
You’re simply not thinking long term then.
I'm all for long term fixes. We need a Labour government to get on with them. A 2019 win would have started us down the right path sooner, but hey. But the energy cap fix is just a short term measure to deal with the here and now. We need that short term stopgap as well, and it needs to happen while the Tories are in government. It can't wait.
The short term approach offers no answer beyond this winter.
Correct. That is what it is for. No more than that. It is not all that Labour are saying on energy though, just the current focus, because people are worried about heating their homes this winter and the government need bouncing into doing something fast.
No, electricity produced by burning coal 35 years ago was cheaper than production methods now but unacceptably polluting
I'm not sure that is entirely true.
"Renewables are by far the cheapest form of power today."
https://electrek.co/2022/07/14/renewables-cheaper-than-coal/
"Renewables are cheaper than ever – so why are household energy bills only going up?"
Coal was cheaper then than gas is now (pre-crisis).
Gas was cheaper then than gas is now (pre-crisis).
Comparing old coal prices to new gas prices doesn't tell us anything.
We need to be going all in on renewables, storage and reducing energy use.
Ramping up on-land renewables is the big thing missing right now.
Coal was cheaper then than gas is now (pre-crisis).
So are renewables according to those two links. And yet despite ever increasing amount of energy from renewables prices are still going up in real terms. Privatisation has not resulted in cheaper prices for consumers.
"Competition" in former state-owned monopolies has resulted in the most expensive source of energy, in this case gas, setting the price for all the others.
People were sold a lie, and voters, including Tory voters, now recognise this. So why does Starmer persist in supporting the lie?
The Guardian this morning:
Barnby was an enthusiast for water privatisation in 1980s. “I thought yippee, we’ll have some efficiency now. But the efficiency has changed to pure greed.”
She added: “I have mostly voted Conservative, but I won’t do it again.” Asked whether the water crisis had changed her vote, she said: “Water and the energy companies – the profits they make are a joke.”
Labour shadow chancellor less than 4 weeks ago:
"Labour will not nationalise rail, water or energy, Rachel Reeves says"
What a great time for Starmer to abandon his pledge of two years ago to nationalise energy and water.
Perfect timing in front of a captive audience to miss a huge open goal. From the man who has touted his alleged "forensic skills".
Poor Mary Barnby might as well carry on voting Tory as both Labour and the LibDems are now committed, despite public opinion and staggering failures, to persist with the failed Thatcherite legacy.
Starmer's excuse is that, according to him, "the pandemic has changed everything". Although the casual observer might be forgiven for thinking that the present energy/water crisis has changed things even more.
“Water and the energy companies – the profits they make are a joke.”
That could be justification for clawing back those profits via a backdated windfall tax, as well as for removing the possibility for removing profits in future in some way (nationalisation or arms length not for profit, etc). It supports both policies.
Renewables are cheaper NOW
https://energypost.eu/5-charts-show-the-rapid-fall-in-costs-of-renewable-energy/
Anyway **** it. Kier Starmer privatised everything and lied to us while he did it, that OK?
Anyway **** it. Kier Starmer privatised everything and lied to us while he did it, that OK?
I'm sorry is this what this is all about......you don't like criticism of Starmer for not supporting a policy which he himself made as one of his "pledges" in his bid to become Labour Leader, and which voters, including Tory voters, support?
Why? Do you think it really is too much to ask of Starmer?
Edit: Btw my emphasis has been to ask why Starmer has totally reversed his position on nationalisation of rail, energy, and water, rather than criticise him for it.
I am genuinely puzzled as it appears to make no sense at all, especially under the present conditions. And I can't see how it will help him get into Number 10 - his stated aim.
No, just that you were wrong about energy costs.