Ed Miliband delivers his speech at the Labour conference in Brighton last year. Photograph: Getty Images.
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Exclusive: The government's private assessment of Labour's energy price freeze

A report on the policy by the Department of Energy and Climate Change is released following a freedom of information request by the New Statesman.

No policy announced by an opposition party in recent years has had more political impact than Labour's proposed energy price freeze. It succeeded in shifting the economic debate from the deficit towards living standards (where it has largely remained since) and left the Tories in a strategic tailspin. The eventual reduction in green levies announced in last year's Autumn Statement would have been unthinkable without Ed Miliband's pledge. 

Given the political and economic significance of the policy, I recently submitted a Freedom of Information request to the Department of Energy and Climate Change (DECC) requesting a copy of their private assessment of the price freeze. After months of waiting, with DECC securing several time extensions, I have now received the 32-page report, which you can read in full below. (It is notably replete with spelling and grammatical errors, for instance, "Chuka Uma" and "Peter Mandelson came out criticising the move ass counterproductive".)

The document has been redacted to exclude an assessment of the legal position and comparisons with similar policies, but offers a useful insight into how the department and others view the measure. Here are some of the most notable extracts.

European reactions and policy (p.9): "The issue has been raised with UK officials" 

The department notes that "the issue of energy prices is coming up the agenda in Europe" and that "the issue has been raised with UK officials by both the EIB [European Investment Bank] and the CION [European Commission]". It adds: "As a general position, the Commission doesn't favour regulated prices (albeit that there is express provision for them in the Electricity and Gas Directives) and it's contrary to the direction of travel on the internal energy market (which is focused on market-based pricing)."

"The Commission has made it clear that it will continue to take cases against Member States where price regulations don't meet EU law conditions. The most recent action of this type is against Poland's gas price regulation (on the basis that there is no time limit and prices apply to to all non-household users regardless of size.) Other actions have included investigations into France and Spain's price regulation on similar grounds."

Ministerial response (p. 30): "Ministers acknowledged that cost of living was an issue" 

In its round-up of ministerial reaction to the policy, DECC writes that "Comment from Government Ministers initially focussed on the prospect of blackouts and the lack of investment (particularly from abroad). As the debate progressed, Ministers acknowledged that cost of living was an issue, and that the best way to address that was right investment now (for example nuclear and fracking). Michael Gove sad [sic] he took the predictions of blackouts with a "pinch of salt". However, he acknowledging [sic] that energy prices were a big issue in the cost of living debate, but argued the Conservatives were addressing these." 

Polling on the price freeze (p.31): "Some polls are predicting Labour could tip the balance...enough to win the 2015 election" 

In its summary of polling on the issue, the department notes that "The polls point to the announcement being generally popular among voters. The YouGov poll reported in the sun [sic] shows over half (58%) of voters do not believe the government's 'scaremongering' predictions of power cuts. Polls show Miliband's popularity has increased and that he (and labour) 'stand up for' ordinary consumers."

In what appears to be a reference to Lord Ashcroft's recent marginals polling, it also notes that "Some polls are predicting labour [sic] could tip the balance enough in marginal [sic] to win the 2015 election."

Labour response (p.31): "Ed Balls and Chuka Uma [sic] noted the risk to Labour's relationship with business" 

The department summarises the response from Miliband's own party, noting that "Interestingly...an unnamed senior shadow minister conceded the policy risked being subject to judicial review". It also writes that "Ed Balls and Chuka Uma [sic] noted the risk to Labour's relationship with business, but that energy was a big part of business' costs. He also reiterated that fairer market [sic] would be a better environment for long-term investment" 

Referring to Peter Mandelson's public criticism of the policy, DECC notes "Peter Mandelson came out criticising the move ass [sic] counterproductive and poor for investment. Lord Myners took a similar critical stance. Much Labour comment in the first few days, however, was critical of Mandelson, in particular pointing out his connections to the energy industry, and his part in the windfall tax in the '90s." 

It adds: "Other comment was around the 'entrenched Big Six', and Caroline flint [sic] noted the Big Six may be opverplaying [sic] their hand as they were already offering fixed deals to 2017." 

SNP reaction (p.31): "A potential split in the party"

DECC highlights "A potential split" in the SNP with "Fergus Ewing ruling-out a freeze in the event of independence, but the left-wing of the party remaining open minded, awaiting the analysis." 

Trade unions (p.30): "Little comment"

"Little comment from unions other than GMB: 'Labour are stepping in where Ofgem has failed.'" 

Other reaction (p.31): "We may wish to renationalise essential elements of our infrastructure"

"Although other comments have praise for Labour's proposal many, again, focus on the detriment to investment and energy security. An interesting point made by Kevin McCullough [chief executive of UK Coal] is that although energy companies may not up sticks, they will focus efforts in other more profitable countries. He suggests that we may wish to renationalise essential elements of our infrastructure. Some used the announcement to call for investment in nuclear; and other comment focusses on going back to the old days of more socialist policies." 

Government assessment of Labour's energy price freeze

George Eaton is political editor of the New Statesman.

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Labour's Eurosceptics should steer clear of loaded language

Phrases such as "wholesale importation" leave the impression Labour will not speak for migrant workers.

Nothing reflects Britain’s division over Brexit than the Labour party. Do we want soft or hard Brexit? What do we prioritise? The fractures within the party’s ranks is a portrait of the divisions splintering the country.

Labour’s ambiguity over Brexit helped it in the general election in appealing to everyone. It convinced Remain voters that they could hold the Tories to account while promising the Leave voters that the referendum decision would be respected. But now clarity is needed. 

The Labour leadership seems to be angling for a hard Brexit, wishing to leave the single market and customs union on the grounds that this honours the wishes of the 52 per cent. Ironically, they are at odds with everyone in this situation, from the general public – who favour access to single market over immigration controls – to a poll in LabourList showing that 72 per cent of readers prioritised inclusion within the single market.

Jeremy Corbyn's lukewarm attitude to the EU is well documented. If the Labour Party are serious about their public ownership plans for the railways and energy, it’s likely they envision it being made difficult within the EU because of directives which create competition between the state and the private sector. There are unexplored alternatives to this, as seen in Germany and Italy where private companies are made and run the industries with the states acting as the major shareholders of the company. However it’s unlikely to see the hard left ever accepting this, given its disdain for both the private sector and the idea of it interacting with the state to deliver services.

But this is not all that should trouble progressives regarding the Labour leadership’s stance on Brexit. During a recent Andrew Marr programme in which he appeared on, Corbyn claimed that mass immigration had been used to denigrate the conditions for British workers, saying that there was a “wholesale importation” of workers from parts of Europe which would then undermine the rights of British workers. It’s an argument that has been regurgitated by British politicians consistently in recent years – but from the right, not the left.

The idea that migrants are taking British jobs and depressing wages does not hold up to evidence at all. The London School of Economics carried out a research which illustrated increases in migration from the EU did not result in depression of British wages. That’s not to suggest that wages have not stagnated, but rather the trend is linked to the financial crash in 2008, rather than migration. Corbyn’s defenders insist that there were no deliberate racist overtones in his argument, and that the villains are employers deliberately taking advantage of an easily exploited labour market. But the manner in which Corbyn framed his speech was worrying.

The reason for this is that Brexit has created an unbelievable sense of uncertainty, insecurity and fear amongst migrants. Their position in society is now being contested by politicians with different stakes in society to them. Xenophobic abuse – legitimised as an acceptable part of political discourse by Brexit – has been climbing swiftly. Immigrants are seen as threats to British jobs and that is a narrative consistently drummed out – not just since last year but for possibly the past decade.

This is not to say that Labour should not address how some employers might seek to cut costs by hiring foreign workers on a cheap rate. But phrases such as “wholesale importation” or even using the heavily demonised “mass migration” simply sketches the idea that Labour are swinging towards the hard Brexit voters, and in doing so leaving migrant workers to be defended by no one. If the intended idea was to castigate employers, it simply entrenched the idea of immigration as a problem. Rather than bringing British and migrant workers together, you know with that whole “workers of the world unite” idea, Corbyn’s framing of the argument keeps them pitted against each other.

If Brexit has shown us anything it’s that language matters in politics in how it transmits its message to people. Slogans such as “take back control” were attacks on multiculturalism and immigration, stoking white nationalism, even if the Leave campaign insisted it wasn’t about that. Likewise, Corbyn might insist it wasn’t about migrants, but his message sounded a lot like he was blaming freedom of movement for the suppression of wage growth in Britain.

Needless to say, Labour need a rethink on what kind of Brexit it pursues.