Johnson fires another warning shot at Miliband

Shadow chancellor calls for major reform of the Labour leadership voting system.

Having elected Ed Miliband as leader less than two months ago, now may seem an odd time for Labour to re-open the debate over its arcane voting system. But that's what the increasingly outspoken Alan Johnson has done. He tells the Times (£): "I would like to see a full one-member one-vote system for leadership contests. At the moment it can be one-member four votes and that's wrong."

Had Johnson's man won (he was a key supporter of David Miliband), one suspects that he may not be so preoccupied with the rule book. But, regardless of his political motives, he makes a convincing argument. As I've pointed out before, the party's tripartite electoral college (divided between MPs/MEPs, party members, and affiliated trade unions and socialist societies) means that some votes are worth significantly more than others. The vote of one MP is worth the votes of 608 party members and 12,915 affiliated members. The vote of one party member is worth the votes of 21 affiliated members. The electoral college system puts Labour out of step with the Tories and the Lib Dems, both of whom elect leaders using a one-member-one-vote system. It would be a mistake for Labour to adopt this system in its purest form; it is both just and necessary for affiliated trade unions, as the founders of the party, to have a say over the leadership. But the extraordinary power held by the PLP can no longer be justified.

There's also no reason to think that Miliband wouldn't be sympathetic to reform. Liam Byrne, who is overseeing Labour's policy review, says that he now expects the party's leadership rules to be "on the table" in discussions. But what's troubling for Labour's leader is that some of those calling for the system to be reformed are, in effect, declaring his election illegitimate. Simmering resentment at the fact that Miliband wasn't the choice of party members and MPs has burst into the open. Alan Milburn and Margaret Hodge both call for the party to deprieve the unions of a say in the leadership election, without whom, of course, Miliband would not have won. Meanwhile, David Blunkett and Charles Clarke issue some of the strongest criticisms we've heard of the Labour leader.

"The problem for Ed is that he got dipped in the Gordon paint pot," says Blunkett. Clarke comments: "Ed Miliband is back to the comfort zone. I don't think he's 'Red Ed' particularly but he hasn't so far shown that he's into challenge." Of the above, Clarke and Milburn are, of course, no longer MPs. But the fear for Team Miliband is that they speak for a significant Blairite constituency in the party. As Dan Hodges reports in this week's magazine (out today), sections of the party remain in a state of unease and unrest following Miliband's repudiation of New Labour.

One shouldn't exaggerate the dissent we're beginning to hear. After all, by historical standards, the Labour Party remains remarkably united. But it looks like Miliband will have some firefighting to do when he returns to Westminster.

George Eaton is political editor of the New Statesman.

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Debunking Boris Johnson's claim that energy bills will be lower if we leave the EU

Why the Brexiteers' energy policy is less power to the people and more electric shock.

Boris Johnson and Michael Gove have promised that they will end VAT on domestic energy bills if the country votes to leave in the EU referendum. This would save Britain £2bn, or "over £60" per household, they claimed in The Sun this morning.

They are right that this is not something that could be done without leaving the Union. But is such a promise responsible? Might Brexit in fact cost us much more in increased energy bills than an end to VAT could ever hope to save? Quite probably.

Let’s do the maths...

In 2014, the latest year for which figures are available, the UK imported 46 per cent of our total energy supply. Over 20 other countries helped us keep our lights on, from Russian coal to Norwegian gas. And according to Energy Secretary Amber Rudd, this trend is only set to continue (regardless of the potential for domestic fracking), thanks to our declining reserves of North Sea gas and oil.


Click to enlarge.

The reliance on imports makes the UK highly vulnerable to fluctuations in the value of the pound: the lower its value, the more we have to pay for anything we import. This is a situation that could spell disaster in the case of a Brexit, with the Treasury estimating that a vote to leave could cause the pound to fall by 12 per cent.

So what does this mean for our energy bills? According to December’s figures from the Office of National Statistics, the average UK household spends £25.80 a week on gas, electricity and other fuels, which adds up to £35.7bn a year across the UK. And if roughly 45 per cent (£16.4bn) of that amount is based on imports, then a devaluation of the pound could cause their cost to rise 12 per cent – to £18.4bn.

This would represent a 5.6 per cent increase in our total spending on domestic energy, bringing the annual cost up to £37.7bn, and resulting in a £75 a year rise per average household. That’s £11 more than the Brexiteers have promised removing VAT would reduce bills by. 

This is a rough estimate – and adjustments would have to be made to account for the varying exchange rates of the countries we trade with, as well as the proportion of the energy imports that are allocated to domestic use – but it makes a start at holding Johnson and Gove’s latest figures to account.

Here are five other ways in which leaving the EU could risk soaring energy prices:

We would have less control over EU energy policy

A new report from Chatham House argues that the deeply integrated nature of the UK’s energy system means that we couldn’t simply switch-off the  relationship with the EU. “It would be neither possible nor desirable to ‘unplug’ the UK from Europe’s energy networks,” they argue. “A degree of continued adherence to EU market, environmental and governance rules would be inevitable.”

Exclusion from Europe’s Internal Energy Market could have a long-term negative impact

Secretary of State for Energy and Climate Change Amber Rudd said that a Brexit was likely to produce an “electric shock” for UK energy customers – with costs spiralling upwards “by at least half a billion pounds a year”. This claim was based on Vivid Economic’s report for the National Grid, which warned that if Britain was excluded from the IEM, the potential impact “could be up to £500m per year by the early 2020s”.

Brexit could make our energy supply less secure

Rudd has also stressed  the risks to energy security that a vote to Leave could entail. In a speech made last Thursday, she pointed her finger particularly in the direction of Vladamir Putin and his ability to bloc gas supplies to the UK: “As a bloc of 500 million people we have the power to force Putin’s hand. We can coordinate our response to a crisis.”

It could also choke investment into British energy infrastructure

£45bn was invested in Britain’s energy system from elsewhere in the EU in 2014. But the German industrial conglomerate Siemens, who makes hundreds of the turbines used the UK’s offshore windfarms, has warned that Brexit “could make the UK a less attractive place to do business”.

Petrol costs would also rise

The AA has warned that leaving the EU could cause petrol prices to rise by as much 19p a litre. That’s an extra £10 every time you fill up the family car. More cautious estimates, such as that from the RAC, still see pump prices rising by £2 per tank.

The EU is an invaluable ally in the fight against Climate Change

At a speech at a solar farm in Lincolnshire last Friday, Jeremy Corbyn argued that the need for co-orinated energy policy is now greater than ever “Climate change is one of the greatest fights of our generation and, at a time when the Government has scrapped funding for green projects, it is vital that we remain in the EU so we can keep accessing valuable funding streams to protect our environment.”

Corbyn’s statement builds upon those made by Green Party MEP, Keith Taylor, whose consultations with research groups have stressed the importance of maintaining the EU’s energy efficiency directive: “Outside the EU, the government’s zeal for deregulation will put a kibosh on the progress made on energy efficiency in Britain.”

India Bourke is the New Statesman's editorial assistant.