Why a bonfire of the green taxes won't save the Tories

Polling shows that 75% of the public don't believe that green taxes are to blame for the surge in bills, and they're right.

The more optimistic among the Conservatives are hailing David Cameron's surprise pledge at PMQs to "roll back" green taxes as an intervention that could allow them to regain control of the energy debate from Ed Miliband. But even if Cameron can get his plan past the Lib Dems (which appears unlikely), it is doubtful that it will produce the political benefits that the Tories hope.

A recent poll by Survation for the Mail on Sunday found that 75% of the public do not believe that green taxes are to blame for higher bills, and they're largely right. The recent surge in energy prices owes much more to increased wholesale prices and profiteering by the big six than it does to environmental levies. In addition, of the £112 of "green taxes and green regulations" attacked by Cameron, the majority are energy efficiency measures designed to aid vulnerable households, including the Energy Company Obligation (£50), the Warm Home Discount for pensioners (£11) and smart meters and better billing (£3). Thus, of the average energy bill of £1,276, just £50 (4%) is accounted for by green taxes in the form of the Renewables Obligation (£30), the Carbon Price Floor (£3), the EU Emissions Trading Scheme (£8) and feed in tariffs (£7).

The Tories could transfer the cost of these measures (which are forecast to reduce bills by £166 by 2020) from consumer bills to general taxation, as the SNP has pledged to do, but Labour would simply reply that the government is giving with one hand and taking with one another. Owing to the big six, bills will continue to rise remorselessly. A bonfire of the green taxes lacks the symbolic power of a two-year freeze in prices and will do nothing to convince the public that the government is prepared to side with them against the energy companies. If the Tories want to trump Miliband, they'll need to go back to the drawing board. 

David Cameron returns to Downing Street earlier today after Prime Minister's Questions. Photograph: Getty Images.

George Eaton is political editor of the New Statesman.

Photo: Getty
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Why there's never been a worse year to leave the EU than 2017

A series of elections will mean Britain's Brexit deal will be on the backburner until at least January 2018. 

So that's it. Theresa May has invoked Article 50, and begun Britain’s formal exit from the European Union.

Britain and the EU27 have two years to make a deal or Britain will crash out without a deal. There are two ways out of that – firstly, it's possible that Britain could withdraw its invocation of Article 50, though the European Court of Justice has yet to rule on whether Article 50 is reversible or not. 

But if the government reaches the end of the two-year window, the timetable can only be extended with the unanimous agreement of not only the heads of the 27 other member states of the European Union, but the United Kingdom as well. Although both sides would suffer economic damage from an unplanned exit, no-one has done particularly well betting on economic self-interest as far as either Britain or the European Union in general is concerned, let alone when the two’s relationship with another is the subject.

For May in particular, the politics of extending the timetable are fraught. Downing Street wants Brexit done and dusted by 2019 to prevent it becoming a destabilising issue in the 2020 election, and in any case, any extension would provoke ructions in the Conservative Party and the pro-Brexit press.

But the chances that the EU27 and the UK will not come to an agreement at all, particularly by March 2019, are high. Why? In a stroke of misfortune for Britain, 2017 is very probably the worst year in decades to try to leave the European Union. Not just because of the various threats outside the bloc – the election of Donald Trump and the growing assertiveness of Russia – but because of the electoral turmoil inside of it.

May will trigger Article 50 at exactly the time that the French political class turns inward completely in the race to pick François Hollande’s successor as President enters its final stretch. Although a new president will be elected by 7 May, politics in that country will then turn to legislative elections in June. That will be particularly acute if, as now looks likely, Emmanuel Macron wins the presidency, as the French Left will be in an advanced state of if not collapse, at least profound transformation. (If, as is possible but not likely, Marine Le Pen is elected President, then that will also throw Britain's Brexit renegotiations off course but that won't matter as much as the European Union will probably collapse.) 

That the Dutch elections saw a better showing for Mark Rutte's Liberals means that he will go into Brexit talks knowing that he will be Prime Minister for the foreseeable future, but Rutte and the Netherlands, close allies of the United Kingdom, will be preoccupied by coalition negotiations, potentially for much of the year.

By the time the new President and the new legislative assembly are in place in France, Germany will enter election mode as Angela Merkel seeks re-election. Although the candidacy of Martin Schulz has transformed the centre-left SPD's poll rating, it has failed to dent Merkel's centre-right CDU/CSU bloc significantly and she is still in the box seat to finish first, albeit by a narrow margin. Neither Merkel's Christian Democrats or Schulz's Social Democrats, are keen to continue their increasingly acrimonious coalition, but it still looks likely that there will be no other viable coalition. That means there will be a prolonged and acrimonious period of negotiations before a new governing coalition emerges.

All of which makes it likely that Article 50 discussions will not begin in earnest before January 2018 at the earliest, almost halfway through the time allotted for Britain’s exit talks. And that could be further delayed if either the Italian elections or the Italian banking sector causes a political crisis in the Eurozone.

All of which means that May's chances of a good Brexit deal are significantly smaller than they would be had she waited until after the German elections to trigger Article 50. 

Stephen Bush is special correspondent at the New Statesman. His daily briefing, Morning Call, provides a quick and essential guide to British politics.