Cameron's The Thick of It-style energy pledge unravels

Government forced to backtrack on surprise announcement that companies will be forced to offer customers the lowest tariff available.

David Cameron's surprise announcement at yesterday's PMQs that energy companies will be forced to put all their customers on the lowest tariff available was yet another The Thick of It moment from a government that has supplied many. The Department of Energy appeared not to have been briefed on the proposal, with officials struggling to offer any detail on the policy. A spokesman eventually fell back on the line that the coalition was looking "at all options" to help consumers get the lowest tariffs.

For the record, here's what Cameron said yesterday:

I can announce that we will be legislating so that energy companies have to give the lowest tariff to their customers – something that Labour did not do in 13 years, even though the leader of the Labour Party could have done it because he had the job.

This morning, it's no clearer where the government stands. There was, perhaps unsurprisingly, no minister available to discuss the subject in the 8:10am slot on the Today programme. It appears probable that Cameron's pledge was "a slip of the tongue", as a spokesman from USwitch, the energy comparison website, surmised.

After Cameron's words in the Commons, a spokesman for the PM said:

We've asked energy companies to take action themselves and make clear what the lowest available deals are. The point is, in practice this market is not operating for everyone. A small minority of people are actually switching deals, therefore we need to push some of this responsibility on to the energy companies.

But there's some difference between pushing "some of this responsibility" on to the energy companies and compelling them to offer customers the best deal available.

In his conference speech, Ed Miliband memorably asked, "Have you ever seen a more incompetent, hopeless, out of touch, u-turning, pledge-breaking, make it up as you go along, back of the envelope, miserable shower than this Prime Minister and this Government?"

Based on the latest farce, the answer is probably "no".

Update II: In humiliating scenes in the Commons, energy minister John Hayes has just been forced to backtrack on Cameron's pledge. In response to an Urgent Question from Labour, he said the government would "use the energy bill to get people lower tariffs [emphasis mine] and of course there are different options to be discussed in that process." Cameron, by contrast, had promised to force companies to give their customers the "lowest" tariff.

Update: Thankfully, the Speaker, John Bercow, also takes the view that the government should be forced to explain itself. He's granted an Urgent Question on the subject at 10:30am.

David Cameron leaves 10 Downing Street as he heads to the House of Commons. Photograph: Getty Images.

George Eaton is political editor of the New Statesman.

Photo: Getty
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Scotland's vast deficit remains an obstacle to independence

Though the country's financial position has improved, independence would still risk severe austerity. 

For the SNP, the annual Scottish public spending figures bring good and bad news. The good news, such as it is, is that Scotland's deficit fell by £1.3bn in 2016/17. The bad news is that it remains £13.3bn or 8.3 per cent of GDP – three times the UK figure of 2.4 per cent (£46.2bn) and vastly higher than the white paper's worst case scenario of £5.5bn. 

These figures, it's important to note, include Scotland's geographic share of North Sea oil and gas revenue. The "oil bonus" that the SNP once boasted of has withered since the collapse in commodity prices. Though revenue rose from £56m the previous year to £208m, this remains a fraction of the £8bn recorded in 2011/12. Total public sector revenue was £312 per person below the UK average, while expenditure was £1,437 higher. Though the SNP is playing down the figures as "a snapshot", the white paper unambiguously stated: "GERS [Government Expenditure and Revenue Scotland] is the authoritative publication on Scotland’s public finances". 

As before, Nicola Sturgeon has warned of the threat posed by Brexit to the Scottish economy. But the country's black hole means the risks of independence remain immense. As a new state, Scotland would be forced to pay a premium on its debt, resulting in an even greater fiscal gap. Were it to use the pound without permission, with no independent central bank and no lender of last resort, borrowing costs would rise still further. To offset a Greek-style crisis, Scotland would be forced to impose dramatic austerity. 

Sturgeon is undoubtedly right to warn of the risks of Brexit (particularly of the "hard" variety). But for a large number of Scots, this is merely cause to avoid the added turmoil of independence. Though eventual EU membership would benefit Scotland, its UK trade is worth four times as much as that with Europe. 

Of course, for a true nationalist, economics is irrelevant. Independence is a good in itself and sovereignty always trumps prosperity (a point on which Scottish nationalists align with English Brexiteers). But if Scotland is to ever depart the UK, the SNP will need to win over pragmatists, too. In that quest, Scotland's deficit remains a vast obstacle. 

George Eaton is political editor of the New Statesman.