Gavin Maclure's Musings

My take on politics locally, nationally and internationally


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Time to bust open the Energy Cartel

Profiteering: Electricity and gas prices are going up

Just as the Arctic blast arrives and we find ourselves reaching for the thermostat, the ominous white envelope  lands on the doormat. I wonder what that could be.

Ah, yes, it’s your “friendly” energy company. With all six energy firms trying to scrape every bit of profit off the bottom of the barrel, they ONLY ever spend money on writing to you when they are telling you your bills are going UP. Anything else: go online or wait three hours for a call centre agent to pick up the phone.

And so it happened this weekend when I received said letter from nPower telling me my electricity was going up by 18% and my gas was going up by 16%. But it’s not their fault you see. nPower even had three stock excuses for ramming my energy bill up by NINE TIMES inflation. The first one is the real killer:

“It’s costing us more in taxes and obligations to carry out government environmental and social schemes”

Pointless: the reason your energy bills are going up

What “government environmental” means is wind farms. The energy companies are being forced by law to invest in “renewable” energy, i.e. wind turbines that don’t turn because of a lack of wind or they turn too fast because it is too windy and therefore have to be switched off unless they break.

So instead of adding more energy to the network, wind farms add next to nothing and instead cost you and I more in additional electricity charges. This is all to meet EU-imposed Co2 emissions targets for non-existent anthropogenic global warming. This may be the wet dream of politicians like Tim Yeo and John Selwyn Gummer who are raking in cash from their various directorships of “green economy” companies but for us mere mortals all it means is a higher energy bill each month so our political elite can keep dining in Brussels. In fact, temperatures haven’t risen since 1997 and the last few winters have been perishing with the Met Office predicting another particular cold one this year.

On top of pointless green policies, which reek of a money-making exercise for the enlightened elite bordering on corruption, it is becoming clearer the big six UK energy firms may be in cahoots with each other. In other words, they may be operating a cartel. No real competition exists. Each firm puts up their charges by the same amount. If you switch, you might get an introductory bonus in the form of “cashback” but you will soon be dragged back into a punishing rate with the only option being to go through another painful switching process if you want to save a few pounds. Not worth the effort and the big six know this.

Of course, if any energy firm talks to another about their prices, they would be committing an offence under the Competition Act 1998. People can go to jail for breaking this law. My question is why are we seeing so little enforcement from the government regulator, Ofgem? Surely there is enough anecdotal evidence of wrongdoing. Ofgem did in fact start an enquiry into profiteering two years ago but since then they have gone very quiet.

Well the tipping point is coming as David Cameron saw when he quipped in the House of Commons energy firms will be compelled to give customers “the lowest tariff”. The PM then quickly backtracked when he realised the government hadn’t actually worked up a policy yet. But in any case, does he really think bills will come down if the big six are forced to offer the lowest tariff. All these profiteering firms will do is dump the majority of their price plans and offer one tariff at the highest charge they can with all six energy firms conveniently offering the same price: a big fat high price!

What we need is real competition. The market needs to be opened up to tens of more firms to dilute the influence the big six have. Currently, no free market exists and it is just another case of capitalism only working for the few, not the many.


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A third runway at Heathrow is not enough

South Suffolk MP Tim Yeo
It was interesting to read Tory MP Tim Yeo’s piece in the Daily Telegraph today on his Damascus-like conversion to more plane travel but I think he might have ulterior motives along with other environmental zealots in the Conservative Party.

Anyway, less of that. Although I agree with some of Mr Yeo’s article, especially the bits about Cameron’s distinct lack of leadership qualities and the need for a “trace of Thatcher”, I don’t agree we should build a third runway at Heathrow. That’s far too little (and probably too late). We need a new airport with two or three runways to ensure we remain competitive with the other hub airports of Europe, such as Schiphol, Frankfurt or Paris.

My view on aviation policy in this country is, and has been for sometime, to build a new hub airport in the Thames Estuary, commonly referred to as Boris Island after the London Mayor’s support for such a scheme last year. I am tempted by a second runway at Stansted but as Ben Gummer alluded in a tweet to me a couple of weeks ago, this would just tinker with the problem rather than fix it. Boris Island would offer a fix, a third runway at Heathrow or second at Stansted would just be a sticking plaster. Without good air links to the world’s commercial centres, which a new London hub airport would bring, we will get left behind along with the likes of Greece, Italy and Spain. You see we are not that different to these despot economies. Gordon Brown back in the noughties presided over unforgivable exorbitant levels of government borrowing, PPI schemes and tuition fees which has left us (or more accurately the next generation and those yet to be conceived) with over a £trillion of debt and rising; it is only our higher GDP which is keeping the IMF at bay. We desperately need to create growth which a new hub airport would bring in construction and future trade.
Thames Estuary airport proposition
So grow some balls Mr Cameron and take a stand for once in your political life. Unfortunately, as I write this I see the Yellow Peril starting to froth at the mouth. The Liberal Democrats, once they’ve made their money, hate anything which brings prosperity to the masses (like all socialists do) so anything to do with creating growth really is not on their agenda. And with a Prime Minister who probably couldn’t care less as long as he can fly out of the country to one of his holiday homes after he retires from politics in 2014/15, aviation expansion looks likely to be kicked into the long grass for another 30 years.
Another example of unforgivable leadership from our ministers.


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Ipswich MP starts ball rolling to improve rail service

As we head back into the first working week of 2012, commuters are looking down the barrel of ticket rises well in excess of inflation and a railway line in the East of England which would have shamed a former Communist republic.

At least our MP, Ben Gummer, recognises the problem and is addressing it at the highest levels of Government from the Prime Minister down. Just before Christmas, Mr Gummer had a meeting in the Houses of Parliament with his fellow MPs whose constituencies the Great Eastern line passes through between Norwich and London, Network Rail, the hated National Express and representatives from the new railway service operator Abellio, who will shortly take over the Great Eastern franchise for two years prior to the award of a 15 year franchise. Let’s not get carried away: not much was fixed at this meeting but a least the extent of the problem was laid bare to all the key players. Network Rail also admitted they were at fault for much of the infrastructure issues (i.e. track and signalling) – however, they were forced to make this admission by the fact delegates to the meeting were DELAYED on the mainline into London by signalling problems in the Stratford area (I’ve heard that one before!).
After the “rail summit” Ben Gummer explained in his weekly Morning Evening Star column his hopes for the railway into the future:

I expect that we will see small but nonetheless important improvements in reliability and customer service in the next two years; new rolling stock in the next five to seven years; and faster journey times in the next decade to fifteen years. All of this is going to take hundreds of millions of pounds. But we will get it, because for the first time all the regions MPs are fighting for it. We know that we need those better rail links to bring jobs and prosperity to our towns and cities, jobs and wealth that will otherwise go elsewhere.

When I read this I felt both pleased and disheartened at the same time. Pleased because at last our MP has given his constituents an action plan for improving our diabolical railway service but also disheartened because if his predecessors in both Ipswich and the neighbouring constituencies had pulled their finger out at the beginning of the century, when incidentally I moved to Ipswich to start working for BT, we would now be close to getting the railway service we deserve.

Much of the blame for inaction must be laid at the door of Mr Gummer’s Labour predecessor: Chris Mole. He knew fine well that the railway service under “Anglia Railways” and then “One” was a disgrace and that it was having a detrimental effect on the Ipswich economy. He then became a rail minister under Gordon Brown. But what did he do over the nine years to improve the Great Eastern mainline service when he was our MP, latterly in the Government with responsibility for railways? Ah that’s right: a big fat nothing! Instead he wasted millions on A14 gantry signs which did not work and a pointless traffic lights scheme at Copdock. The guy should be barred from holding public office ever again.

But, to be fair, the Conservatives should also take their fair slice of blame: Tim Yeo in South Suffolk, Sir Michael Lord in Central Suffolk and North Ipswich, and inconveniently for Ben Gummer, a certain former Member for Suffolk Coastal, Lord Deben (John Gummer), also sat back and took no discernible action during the 2000s.

However, we cannot dwell on the past. Ben Gummer has a plan and I intend to keep the pressure on him to deliver the goods (and offer my support where I can).