Politics Part 3: Labour and Energy

OK. Really old. And REALLY boring now. Oh, and brief disclaimer: Heck, what do I know? I’m not a politician, economist, climate scientist, or anything, I’m just a guy with a few half-baked ideas

Labour. Well, let’s really start with the Conservatives. I’m not a fan really. Austerity possibly has some merits as a means of fixing the economy. But their constant anti-Robin-Hood, take-from-the-poor-and-give-to-the-rich kind of policies, and the constant bashing of those on benefits without understand those on benefits, is pretty shocking.

Anyway, some big Labour politicians came to Swindon today. And all I could really see (on Twitter) them talking about was the price of energy, and the price of train fares.

I’m a bit baffled by the energy thing. Energy seems to be provided by a load of companies who compete against one another for customers. And yet, they all seem to raise prices at the same times. Which seems odd. And no one really seems to be doing the under-cutting. They’re all much of a much-ness, and their prices seem to mostly be influenced by the wholesale cost of energy and the taxes and levies imposed by government. They may well make lots of profit, and that’s not great from companies that provide public services. I’m as annoyed as anyone about increasing energy company profits. But that’s what companies do.

My question then is HOW will Labour go about freezing energy prices. Energy prices are controlled by business, not by government.

I visited their website to find out and it wasn’t massively helpful.

And anyway. There are problems with:

  • I think global warming is real and that we should be cutting energy costs. If prices go down in real terms then won’t that discourage us from saving energy?
  • I think that energy security is a much bigger issue. The cost is irrelevant if there is no supply.

I’d much rather see a long-term focus on sustainability, efficiency and reduced use, and energy-security. We’d have much better control of energy prices in this country if we used less of it, and had our own clean, efficient supply with a surplus we could export. That would be good for health, prices, industry, transport, and the world at large.

Magically fixing train fares and energy costs seem to me to be populist electioneering policies. There are bigger things we need to do that will help both of these issues in the long term. Who’s going to tackle those things for us?!

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  • http://www.komadori.me.uk/ komadori

    Energy prices aren’t entirely controlled by business, as electricity and gas ‘distribution’ are both regulated industries, just as some of the rail industry is. But the regulation of gas and electricity is rather limited: ‘generation’ and ‘supply’ are not regulated.

    Whilst I can see that the energy market seems not to be very effective – with the market dominated by the big six suppliers which all make healthy profits – the arguments about rail do seem nothing more than political nonsense. Railway’s are not highly profitable. Most train operating companies and Network Rail receive subsidies. Where they are profitable, the companies have to pay large fees to central government for the privilege of having the franchise. So if Labour want rail fares to come down that ultimately means central government getting smaller fees from profitable lines and paying larger subsidies for the unprofitable ones. Should lower rail fares really be paid for from taxation – which would be the consequence? Particularly when the most politically sensitive fares are those paid by commuters to London, many of whom are not amongst the poorest in society.

    • Andy_in_Germany

      Agreed on the affluence of many rail-using commuters..

      On the other hand, there is a good argument that rail benefits people who don’t use it because it is a less polluting form of transport.

      It is also noticeable that local towns in Germany will view a rail connection as a benefit to the local community so they are prepared to invest in it, because rail can be and often is funded by local towns rather than central government. (and note the word is ‘invest’ not ‘subsidise’ like it is in the UK: Have you noticed that money spent on roads is ‘investment’ and money used for public transport is ‘subsidy’?) Returning to sibject, his does mean lower fares and better service, even tthough often the company providing the service is privately owned.

      A similar situation exists in the power generation industry

      Perhaps the answer here is less massive companies providing the services and more smaller, local ones which are accountable to the people they serve, rather than politicians who may or may not be interested.