Shadow energy secretary Caroline Flint speaks at the Labour conference. Photograph: Getty Images.
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Labour wins race to claim credit for energy market inquiry

While ministers were nowhere to be seen, Caroline Flint was on the Daybreak sofa.

After SSE's announcement yesterday that it will freeze energy prices until 2016 (which gifted Ed Miliband a winning line of attack for PMQs), this morning has brought another opportunity for Labour to argue that where it leads, others follow. Ofgem has revealed that it has ordered a full market inquiry into the big six providers to "consider once and for all whether there are further barriers to effective competition", a move that could ultimately lead to the break-up of suppliers. The investigation will be conducted by the Competition and Markets Authority (CMA) and is expected to last for 18 months. 

Here's the statement from Ofgem chief executive Dermot Nolan: "Ofgem believes a referral offers the opportunity to once and for all clear the air and decide if there are any further barriers which are preventing competition from bearing down as hard as possible on prices.

"I want to make sure that consumers are put at the heart of this market, so we will continue to take action to help consumers. This includes from today putting the industry on notice that any new serious breach of the rules which comes to light will be likely to attract a higher penalty from Ofgem."

Both Labour and the coalition will fight to take credit for this decision. It was Miliband who so prominently warned of a "broken market" in his conference speech last year, which prompted David Cameron to order a review of competition. In a letter leaked last month, Energy Secretary Ed Davey urged Ofgem to "think radically" as it considered whether to refer the sector for a full CMA probe. That is precisely what it has now done. But while both sides will now seek to claim victory, there was one clear winner this morning. 

While ministers were nowhere to be seen, Caroline Flint was on the Daybreak sofa hailing the decision as a vindication of Labour's radical stance. "It's a really frank admission that Ofgem hasn't been able to ensure that these companies work in a competitive way, it's an admission of failure, to be honest," she said. "I've been on this sofa the last couple of years saying that there's something seriously wrong here. It's why six months ago, pretty much six months to today, Ed Miliband announced that we would have a price freeze across the energy market and reform it fundamentally for the future." It was an hour and a half later that the coalition finally sprung to life with the Department of Energy and Climate Change issuing Davey's response

For Labour, the energy price freeze remains a valuable weapon. One shadow minister told me yesterday that private polling shows it remains the party's most popular policy, with high ratings from Conservative and UKIP voters even when Labour is explicitly referred to. While the government's decision to cut green levies and to ensure a full competition inquiry means it has a better defence against Miliband, he can still argue that more radical and faster action is needed. So long as bills continue to rise, the promise of a freeze will remain politically potent. But as I wrote yesterday, the refocus on this policy is a reminder that Miliband hasn't enjoyed a similar hit since. If he is to settle Labour nerves, he'll need to come up with a sequel soon. 

George Eaton is political editor of the New Statesman.

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In your 30s? You missed out on £26,000 and you're not even protesting

The 1980s kids seem resigned to their fate - for now. 

Imagine you’re in your thirties, and you’re renting in a shared house, on roughly the same pay you earned five years ago. Now imagine you have a friend, also in their thirties. This friend owns their own home, gets pay rises every year and has a more generous pension to beat. In fact, they are twice as rich as you. 

When you try to talk about how worried you are about your financial situation, the friend shrugs and says: “I was in that situation too.”

Un-friend, right? But this is, in fact, reality. A study from the Institute for Fiscal Studies found that Brits in their early thirties have a median wealth of £27,000. But ten years ago, a thirty something had £53,000. In other words, that unbearable friend is just someone exactly the same as you, who is now in their forties. 

Not only do Brits born in the early 1980s have half the wealth they would have had if they were born in the 1970s, but they are the first generation to be in this position since World War II.  According to the IFS study, each cohort has got progressively richer. But then, just as the 1980s kids were reaching adulthood, a couple of things happened at once.

House prices raced ahead of wages. Employers made pensions less generous. And, at the crucial point that the 1980s kids were finding their feet in the jobs market, the recession struck. The 1980s kids didn’t manage to buy homes in time to take advantage of low mortgage rates. Instead, they are stuck paying increasing amounts of rent. 

If the wealth distribution between someone in their 30s and someone in their 40s is stark, this is only the starting point in intergenerational inequality. The IFS expects pensioners’ incomes to race ahead of workers in the coming decade. 

So why, given this unprecedented reversal in fortunes, are Brits in their early thirties not marching in the streets? Why are they not burning tyres outside the Treasury while shouting: “Give us out £26k back?” 

The obvious fact that no one is going to be protesting their granny’s good fortune aside, it seems one reason for the 1980s kids’ resignation is they are still in denial. One thirty something wrote to The Staggers that the idea of being able to buy a house had become too abstract to worry about. Instead:

“You just try and get through this month and then worry about next month, which is probably self-defeating, but I think it's quite tough to get in the mindset that you're going to put something by so maybe in 10 years you can buy a shoebox a two-hour train ride from where you actually want to be.”

Another reflected that “people keep saying ‘something will turn up’”.

The Staggers turned to our resident thirty something, Yo Zushi, for his thoughts. He agreed with the IFS analysis that the recession mattered:

"We were spoiled by an artificially inflated balloon of cheap credit and growing up was something you did… later. Then the crash came in 2007-2008, and it became something we couldn’t afford to do. 

I would have got round to becoming comfortably off, I tell myself, had I been given another ten years of amoral capitalist boom to do so. Many of those who were born in the early 1970s drifted along, took a nap and woke up in possession of a house, all mod cons and a decent-paying job. But we slightly younger Gen X-ers followed in their slipstream and somehow fell off the edge. Oh well. "

Will the inertia of the1980s kids last? Perhaps – but Zushi sees in the support for Jeremy Corbyn, a swell of feeling at last. “Our lack of access to the life we were promised in our teens has woken many of us up to why things suck. That’s a good thing. 

“And now we have Corbyn to help sort it all out. That’s not meant sarcastically – I really think he’ll do it.”