Sir John Major entered the fray on energy today with a suggestion of a windfall tax on energy companies. This panders to the Ed Milliband side of the court. Surely the solution is so simple that a five year old could see it, although not someone with a PPE from Oxford. The industry have identified a whole raft of carbon change taxes, many of which just get sent to Brussels. Immediately cut green taxes on fuel by 4-5% and call on the energy companies to match it. At the same time promise further cuts within six to twelve months until the taxes/subsidies have been removed entirely. Retain the Warm Home discount for the over 75s. It is only 1% anyway and cut deeply into the Energy Company Obligations(ECOs). They are a misnomer if anything is as it is not an obligation on the Company but on the consumer. If any energy companies fail to match the reductions, then their future cuts will not be made. The popularity of any non compliant company would plough the slough of despond. And customers would move to the more competitive suppliers. And for the love of Mike, don’t just move the costs from our bills to our taxes. We really are not that stupid to see that for the majority it makes little difference which pocket you take it out of. It is still our pockets!
At the same time extend the powers of OFGEM to price oversight. The energy companies would then have to justify any price rises with full transparency. A full paper trail from production to delivery. Without that the prices would be frozen until such time as full disclosure is available. And before the Ministers worry about these companies whose profits are measured in billions, just consider how much corporation tax most don’t pay in the UK.
And whilst they are about it let’s ditch Advanced Passenger Duty, the Landfill Taxes and Carbon Floor Prices and get the UK moving onwards and upwards. Such simple solutions and you heard them here first!