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5 November 2013

Balls shows how Labour will counter Osborne’s green tax gambit

The shadow chancellor charges the Tories with penalising "the ordinary taxpayer" by shifting green charges from bills without punishing the energy companies.

By George Eaton

After being left in a tailspin by Ed Miliband’s pledge to freeze energy prices, the Tories are confident that they can shift the debate in their favour by using George Osborne’s Autumn Statement (on 4 December) to announce the removal of some green charges from consumers’ bills. But at Treasury Questions today, Ed Balls showed how Labour will counter this gambit. The shadow chancellor attacked Osborne for planning to shift “the burden of his green levies onto the ordinary taxpayer”, accusing the Tories of “giving with one hand but taking with another”. 

While Labour will not oppose the move outright, not least because, as the Lib Dems are keen to point out, a tax-funded system is more progressive, it will present it as profoundly inadequate. Citing John Major’s support for an energy windfall tax, Balls argued that both the former PM and Labour had recognised that it was “the energy companies that are making the excess profits” and that they, “not the ordinary taxpayer”, should pay. 

Removing green charges from bills at least gives the Tories something to say in response to Miliband but it is likely to offer them only temporary relief. As one Labour strategist argued to me recently, Miliband’s policy has a “longer shelf life”. By the time of the election, after further price increases, it is his freeze that will still look like the most attractive offer. 

P.S. In a battle of the puns, Balls accused Osborne of not giving an “EDF” about energy prices, to which Osborne hit back, “with questions like that he is never going to be npower”. 

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