Should we follow New Zealand and nationalise consumer energy sales?

There's much more to be done in the energy sector, writes William Wallace.

Kia ora! New Zealand; stunning mountains, untouched coastline, rugby madness – but also a policy goldmine. British politicians love “borrowing” ideas from our Australian and New Zealander cousins (Scandanavia always serves well in a pinch). From welfare reform to free schools, through family law and prisoner rehabilitation, we’ll take it. So could there be the potential to add energy policy inspired by the Kiwi left to the mix?

A conversation with a friend in the New Zealand energy sector alerted me to this policy announcement from the New Zealand Labour Party. Could the proposal to create a new, independent body, "NZ Power", to act as a single buyer of wholesale electricity inspire the UK parties to revisit their troubled consumer energy policies? With the Energy Bill stumbling into a new parliamentary session and Ofgem announcing a new, complex, tariff comparison service there is certainly scope for fresh policy thinking.

At first sight, as a New Zealand Minister has said, it all sounds a little “North Korea like”. And it is. But reading the policy in more detail, the power of a new regulator to take a unified approach to development, the energy mix, set prices based on operating costs and a fair return on investment and encourage competition in the interests of consumers might pique more interest among policy makers. The policy comes with claims that prices for the average household will drop by £150, business prices will drop between 5 per cent and 7 per cent and 5000 jobs will be created. All hot air? Maybe, but it sounds politically attractive enough to give some food for thought.

Energy is shaping up to be one of the defining issues of the next general election like never before. But despite the current Energy Bill going through its parliamentary stages, neither Caroline Flint (with her slightly light pronouncements on abolishing Ofgem announced on a whim at party conference) or Number Ten’s disastrous counter-attack announcing un-workable plans that everyone would get the lowest tariff have come up with a way to address persistent energy price rises. With Labour viewing energy through the prism of consumer fairness and the Coalition through the prism of growth, there is certainly scope for  some fresh thinking on the issue.

In reality, this policy isn’t going to happen in the UK. It’s clearly politically toxic, with the Coalition likely to reject it on ideological and competition grounds and any Labour temptation towards nationalisation tempered by long-memories of Michael Foot and co. But what this does serve to show is that there is a paucity of ideas in this electorally significant area and as the Energy Bill continues to stall in Parliament, manifestos develop and the parties move to a war footing, that fact is becoming ever more politically relevant.

William Wallace is a Consultant at Fishburn Hedges.

Ukip's Nigel Farage and Paul Nuttall. Photo: Getty
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Is the general election 2017 the end of Ukip?

Ukip led the way to Brexit, but now the party is on less than 10 per cent in the polls. 

Ukip could be finished. Ukip has only ever had two MPs, but it held an outside influence on politics: without it, we’d probably never have had the EU referendum. But Brexit has turned Ukip into a single-issue party without an issue. Ukip’s sole remaining MP, Douglas Carswell, left the party in March 2017, and told Sky News’ Adam Boulton that there was “no point” to the party anymore. 

Not everyone in Ukip has given up, though: Nigel Farage told Peston on Sunday that Ukip “will survive”, and current leader Paul Nuttall will be contesting a seat this year. But Ukip is standing in fewer constituencies than last time thanks to a shortage of both money and people. Who benefits if Ukip is finished? It’s likely to be the Tories. 

Is Ukip finished? 

What are Ukip's poll ratings?

Ukip’s poll ratings peaked in June 2016 at 16 per cent. Since the leave campaign’s success, that has steadily declined so that Ukip is going into the 2017 general election on 4 per cent, according to the latest polls. If the polls can be trusted, that’s a serious collapse.

Can Ukip get anymore MPs?

In the 2015 general election Ukip contested nearly every seat and got 13 per cent of the vote, making it the third biggest party (although is only returned one MP). Now Ukip is reportedly struggling to find candidates and could stand in as few as 100 seats. Ukip leader Paul Nuttall will stand in Boston and Skegness, but both ex-leader Nigel Farage and donor Arron Banks have ruled themselves out of running this time.

How many members does Ukip have?

Ukip’s membership declined from 45,994 at the 2015 general election to 39,000 in 2016. That’s a worrying sign for any political party, which relies on grassroots memberships to put in the campaigning legwork.

What does Ukip's decline mean for Labour and the Conservatives? 

The rise of Ukip took votes from both the Conservatives and Labour, with a nationalist message that appealed to disaffected voters from both right and left. But the decline of Ukip only seems to be helping the Conservatives. Stephen Bush has written about how in Wales voting Ukip seems to have been a gateway drug for traditional Labour voters who are now backing the mainstream right; so the voters Ukip took from the Conservatives are reverting to the Conservatives, and the ones they took from Labour are transferring to the Conservatives too.

Ukip might be finished as an electoral force, but its influence on the rest of British politics will be felt for many years yet. 

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