Support 100 years of independent journalism.

  1. Politics
  2. The Staggers
8 November 2017updated 09 Sep 2021 5:00pm

The government’s energy price cap is a load of hot air

Concerns have begun to mount as to the government’s true dedication to such a policy. 

By Rebecca Long-Bailey MP

Soaring energy bills are hammering millions of hard up households and businesses.

With the current cost of living crisis and wages falling in real terms, too many people are paying too much just to cover the cost of their basic energy usage.

Analysis by the Big Deal collective shows that customers on standard deals with the big six energy companies can end up paying £225 more than their cheapest deal. These are loyal customers, who are quite simply being ripped off by the Big Six, who for too long have had a stranglehold on our energy market.

Even more worryingly, recently a leaked transcript demonstrated just how much the government is influenced by the Big Six players. The transcript referred to discussions between government and energy investors and illustrated a clear willingness of the government to drop the proposed price cap if energy companies made efforts to reduce consumer bills.

This is simply not good enough. It’s time for this ailing government to take clear and robust action to get a better deal for the British public.

Select and enter your email address Quick and essential guide to domestic and global politics from the New Statesman's politics team. A weekly newsletter helping you fit together the pieces of the global economic slowdown. The New Statesman’s global affairs newsletter, every Monday and Friday. The best of the New Statesman, delivered to your inbox every weekday morning. The New Statesman’s weekly environment email on the politics, business and culture of the climate and nature crises - in your inbox every Thursday. Our weekly culture newsletter – from books and art to pop culture and memes – sent every Friday. A weekly round-up of some of the best articles featured in the most recent issue of the New Statesman, sent each Saturday. A newsletter showcasing the finest writing from the ideas section and the NS archive, covering political ideas, philosophy, criticism and intellectual history - sent every Wednesday. Sign up to receive information regarding NS events, subscription offers & product updates.
  • Administration / Office
  • Arts and Culture
  • Board Member
  • Business / Corporate Services
  • Client / Customer Services
  • Communications
  • Construction, Works, Engineering
  • Education, Curriculum and Teaching
  • Environment, Conservation and NRM
  • Facility / Grounds Management and Maintenance
  • Finance Management
  • Health - Medical and Nursing Management
  • HR, Training and Organisational Development
  • Information and Communications Technology
  • Information Services, Statistics, Records, Archives
  • Infrastructure Management - Transport, Utilities
  • Legal Officers and Practitioners
  • Librarians and Library Management
  • Management
  • Marketing
  • OH&S, Risk Management
  • Operations Management
  • Planning, Policy, Strategy
  • Printing, Design, Publishing, Web
  • Projects, Programs and Advisors
  • Property, Assets and Fleet Management
  • Public Relations and Media
  • Purchasing and Procurement
  • Quality Management
  • Science and Technical Research and Development
  • Security and Law Enforcement
  • Service Delivery
  • Sport and Recreation
  • Travel, Accommodation, Tourism
  • Wellbeing, Community / Social Services
I consent to New Statesman Media Group collecting my details provided via this form in accordance with the Privacy Policy
THANK YOU

I have seen firsthand the destructive impact unsustainable energy prices has on our families, our neighbours and our friends. I have heard from countless people, detailing how they have to make tortuous decisions between food and fuel, but no one living in modern Britain should have to make that choice.

Content from our partners
High streets remain vitally important to local communities
The future of gas
Taxing non-doms fairly would raise billions

During the general election however, it appeared the Conservatives had listened to Labour’s calls and promised to introduce a cap on energy bills. The Prime Minister unequivocally promised to knock off at least £100 from the bills of over 17 million households.

Since then however we have experienced somewhat of a rollback on this promise. After press reports that the Big Six and indeed senior cabinet Ministers were lobbying the Prime Minster to drop the cap, it failed to make an appearance in the government’s forthcoming legislative programme.

Following this the Prime Minister came under intense pressure to introduce the cap from not only Labour but even many of her own back bench MPs. This resulted in the publication of a draft bill, yet to make its way formally through Parliament, but so ambiguous it simply asked Ofgem to introduce a cap with no indication from government as to the parameters of such a cap, nor did it refer to a clear time scale for implementation.

We should be thankful that we saw any progress at all, but concerns have begun to mount as to the government’s true dedication to such a cap. Only last week the Business, Energy and Industrial Strategy secretary Greg Clark repeatedly refused to promise that the price cap would be in place by next winter. He claimed that the government could not guarantee that the necessary legislation would be passed in time.

What’s even worse is that the price cap legislation proposed by the government, once finally passed, may only be in force for two winters, leaving households at the mercy of big energy companies who will be free to push up prices again.

It is clear therefore that the government has no visible plans to radically reform the energy market before 2020, rendering the proposed cap nothing but a sticking plaster -a short-term solution to a long term problem.

This barely functioning government seems more intent on clinging to power than to help struggling households with their spiralling energy costs. Their inability to act is forcing more and more vulnerable people into fuel poverty, who have been forced to pay, again and again, for their continued economic mismanagement. Currently, 1.14 million older people and just under a million households with at least one disabled person are forced to live in fuel poverty.

A future Labour government will introduce an emergency price cap to ensure that the average dual-fuel household energy bill remains below £1,000 per year, whilst radically reforming the energy market to transition to a fairer system for bill payers.

Only Labour will provide much needed relief to overburdened households and only Labour will transform the energy system, harness sustainability and cut bills for your business and your household.

Rebecca Long Bailey is shadow Business, Energy and Industrial Strategy secretary and the Labour MP for Salford and Eccles.