Even Lynton Crosby must know the Tories are on the wrong side of the energy debate

By defending a broken energy market, the Conservatives have shown how out of touch they are with consumers.

There are only two explanations I can think of for the ill-judged and half-baked response of the Tories to the key announcements unveiled by Ed Miliband this week. The first is that Lynton Crosby has been on holiday. And the second is that they are even more out of touch than we imagined. I doubt, however, that David Cameron would give his pet lobbyist time off the week off before his party’s own conference. So, the latter must be true.
 
Yet even Lynton must have wondered at the hysterical response to Ed’s announcement that we would freeze gas and electricity bills in 2015, for 20 months, while we reset the market. Street lights would flicker and snuff out, companies would leave and investment in renewable energy would grind to a halt. The notion that the energy companies, which have increased average bills by £300 over the last three years, are at risk of going bust if Labour freezes bills for 20 months is frankly ridiculous. And the idea that they need to make excess profits at the expense of the consumer to invest, ignores the fact that profits have gone up over the last four years but investment in clean energy has slumped from £7.2bn in 2009 to £3bn in 2012.
 
Take Centrica, for example, the company that has been most vocal about our proposal. They claim that "if prices were to be controlled against a background of rising costs it would simply not be economically viable for Centrica, or indeed any other energy supplier, to continue to operate and far less to meet the sizeable investment challenge that the industry is facing". The reality is that over recent years, Centrica has made the biggest profits of any of the Big Six but has invested the least in new plants. Rather than delivering the investment everyone agrees we need, they have been paying 74% of their profits out as dividends. The truth is that some of these companies have seen profits from their sales to households rise by 30% in a year, irrespective whether the cost of wholesale generation and purchase has risen or fallen. In fact, the only thing that’s fallen as far as customers are concerned is trust in companies that appear to be operating in a market which for them is more comfortable than competitive. And all this at a time when working people are an average of almost £1,500 a year worse off under this government.
 
Labour’s proposal, advanced with such clarity in Ed Miliband’s inspiring speech at Brighton, is no more than a proportionate, just and necessary corrective to this situation. It will be an intervention on behalf of the people by a government fighting for the interest of the people. And the people should not be expected to stand by and be bullied, or held to ransom, by companies implausibly threatening job losses and capital flight.
 
We might recall the prophecies of doom which accompanied the creation of the minimum wage – a control on the price of labour itself, of course – and the reality that unemployment didn’t increase and businesses were able to compete through higher skills and greater investment instead. A race to the top, instead of a race to the bottom, if you like. So let’s get this policy in perspective and hear no more nonsense about Seventies-style socialism. What Ed has suggested is just the right thing to do by a Labour government that welcomes market mechanisms where they function well and in the interests of consumers, businesses and the society which they inhabit. This is about resetting a broken market and injecting the competition and transparency that we need to restore fairness and trust.
 
David Cameron and his grossly out-of- touch colleagues would do well to stop defending the profits of the energy companies and instead read David Sainsbury’s excellent new book Progressive Capitalism. There, the PM might learn from someone who was at the heart of the New Labour about the necessity of government intervening to set rules and create institutions that can manage markets in the interests of the people, not of the profiteers. And he might also decide the right thing to do is to pinch our proposal and freeze prices sooner than 2015. Consider it a freebie, Mr Cameron, a policy gift from Labour. Keep it; we’ve got plenty more to spare.
 
David Cameron with shadow energy secretary Ed Davey at the Clean Energy Ministerial Conference on April 26, 2012 in London. Photograph: Getty Images.

Owen Smith is shadow welsh secretary and Labour MP for Pontypridd.

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I believe only Yvette Cooper has the breadth of support to beat Jeremy Corbyn

All the recent polling suggests Andy Burnham is losing more votes than anyone else to Jeremy Corbyn, says Diana Johnson MP.

Tom Blenkinsop MP on the New Statesman website today says he is giving his second preference to Andy Burnham as he thinks that Andy has the best chance of beating Jeremy.

This is on the basis that if Yvette goes out first all her second preferences will swing behind Andy, whereas if Andy goes out first then his second preferences, due to the broad alliance he has created behind his campaign, will all or largely switch to the other male candidate, Jeremy.

Let's take a deep breath and try and think through what will be the effect of preferential voting in the Labour leadership.

First of all, it is very difficult to know how second preferences will switch. From my telephone canvassing there is some rather interesting voting going on, but I don't accept that Tom’s analysis is correct. I have certainly picked up growing support for Yvette in recent weeks.

In fact you can argue the reverse of Tom’s analysis is true – Andy has moved further away from the centre and, as a result, his pitch to those like Tom who are supporting Liz first is now narrower. As a result, Yvette is more likely to pick up those second preferences.

Stats from the Yvette For Labour team show Yvette picking up the majority of second preferences from all candidates – from the Progress wing supporting Liz to the softer left fans of Jeremy – and Andy's supporters too. Their figures show many undecideds opting for Yvette as their first preference, as well as others choosing to switch their first preference to Yvette from one of the other candidates. It's for this reason I still believe only Yvette has the breadth of support to beat Jeremy and then to go on to win in 2020.

It's interesting that Andy has not been willing to make it clear that second preferences should go to Yvette or Liz. Yvette has been very clear that she would encourage second preferences to be for Andy or Liz.

Having watched Andy on Sky's Murnaghan show this morning, he categorically states that Labour will not get beyond first base with the electorate at a general election if we are not economically credible and that fundamentally Jeremy's economic plans do not add up. So, I am unsure why Andy is so unwilling to be clear on second preferences.

All the recent polling suggests Andy is losing more votes than anyone else to Jeremy. He trails fourth in London – where a huge proportion of our electorate is based.

So I would urge Tom to reflect more widely on who is best placed to provide the strongest opposition to the Tories, appeal to the widest group of voters and reach out to the communities we need to win back. I believe that this has to be Yvette.

The Newsnight focus group a few days ago showed that Yvette is best placed to win back those former Labour voters we will need in 2020.

Labour will pay a massive price if we ignore this.

Diana Johnson is the Labour MP for Hull North.