Tuesday 24 September 2013

Ed Miliband and the quest for power

So Ed Miliband's big idea should he form the next government is to freeze fuel bills for 2 years until 2017.

A grand headline grabbing pledge, but it is doable?

Remember that Labour have been telling us for the last 5 years that this current financial crisis is a global situation that had nothing to do with their slack regulation of British banks. Or not spending all the taxation revenue on vanity projects rather than dealing with excesses in public budgets or dealing with improving infrastructure, indeed shipping spiraling debts on the public sector as a result of Private Finance Initiative funding.

So unto the next big idea. Most of our energy in 2015-17 will still come from oil fired power stations. The price of oil is not set by Westminster, but by global markets. So what if there is another war in the middle east that will affect oil prices once again. How would Ed Miliband deal with keeping everyone fuel costs as they are? How would he fund a pay freeze under such circumstances.

He has promised not to renationalise the energy providers, so how is he going to enforce a cost freeze on these companies? This is a very grey area, especially as some of the fuel companies that operate in the UK are not largely let alone wholly owned within the UK. Surely the only lever he could operate over costs would be the taxes he levies on fuel, but that would reduce the amount that ends up in the Government coffers.

I'm not even going to address the fact that our energy companies are saying they will only have 2% spare capacity come 2015 and will be needing to invest in infrastructure, a question mark over where that money would come from if they are loss making as a result of Ed's bright idea.

So is this a workable idea? Or is it just pie in the sky?

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