Editorial: Labour’s got itself unplugged again

So here we go again. Labour have said they will cap energy company price rises. Shadow Chancellor John McDonnell’s barmy idea when it comes to price rises is to “legislate […]

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By Sumit Bose

So here we go again.

Labour have said they will cap energy company price rises. Shadow Chancellor John McDonnell’s barmy idea when it comes to price rises is to “legislate to control them now” oh yes! Heard that one before?

Ed (where he Miliband?) had the same idea before the 2015 elections. It garnered a few moments in the light, then faded into oblivion like his hopes of being PM.

Sure we know the job of opposition is to oppose and also come up with promises and plans that you know you won’t have to explain and have no chance of delivering. I don’t blame Mr McDonnell for going to a soundbite like that, hey we are talking about it aren’t we?

But here’s where the fuse blows on any such plans.

No one can cap energy prices provided we have a free market, the only way to do it is to re-nationalise all the energy supply licences and power stations. That my friends is frankly so crippling to our beleaguered finances that it’s impossible.

Are the Big Six utter gits for raising prices based on wholesale rates, maybe? They all do it and we know they do it and we have known they have been doing it for years. So what can you do about it?

Move your account!

It’s as simple as that. In a free market and whether we like the energy market as it is now or not, one thing is clear it is a market of choice. You now have dozens of energy suppliers to choose from apart from the Big Six.

We move our phones easily enough and we shop where we like. If you don’t like npower’s price hike or EDF then leave them.

When ELN started in 2010 you could have said there was a ‘cartel like feel’ to the market. Now that’s not the case. I can personally choose from 34 suppliers, I can shop around. If I choose not to then that’s my choice but I can’t complain.

Older people are more unlikely to swap due to loyalty, habit and lack of awareness. My own mother won’t ever leave British Gas, as she has been with them since privatisation. She also still pays by cheque. I have told her there are cheaper providers, offered to help her swap but she would rather pay more than move her account.

I know vulnerable people do need help and if we were going to do anything to protest, it would be to encourage all the providers to give more help to the fuel poor and to have more sensitive systems so they can spot those in need.

Suppliers are not saints but they are businesses. Some are expensive, some are cheap. You may want them to change but they won’t, they operate on margins and returns. They react to the markets and you can only change that if you stop the markets from existing and pay for all our power from the public purse.

That is never going to happen.

So although Labour have had a little bite at the energy companies, they know as do we, that in reality it was just that. A nibble without teeth.