So How Is Red Ed Going To Achieve A Price Freeze?

[ToraToraTora]

http://www.bbc.co.uk/news/uk-politics-25149306
Bribery? Nationalisation? Subsidy?

[youngmafbog]

Simple answer is, he cannot (and neither can the Tories 100% with negotiation).

The minute you try interfering with commercial companies by law (and that is how he would have to do it) then you are on the first step to communism, Red Ed despite his leanings will not want to be associated with anything like that.

[ToraToraTora]

So it's just rhetoric then?

[Quizmonster]

He's not going to have to "Achieve A Price Freeze", is he? Blue Dave will have done it for him before 2015, if he's to be believed.

[youngmafbog]

I can't see it can be anything else.

Of course I could be wrong, Red Ed may take the path of his Union brothers and paymasters want and move the country to communism.

Comrade ToraToraTora; has a certain ring !

Now all stand for a chorus of the Red Flag led by Mickey and Jake.

[Mattk]

If he can freeze the market then the companies will simply hike their prices beforehand to compensate.
The recent rise may have been made with that in mind.

[andy-hughes]

Fuel prices are governed by international market forces and tarrifs, which are entirely outside the control of any individual government, so Ed is bluffing, and it is a seriously unconvincing bluff, which makes him a fool.

You can fool the electorate, but you need a better plan than this!

[jomifl]

Average UK domestic income £40,000. Ed's average fuel saving £120, ie 0.3%, you can almost hear the electorate rushing to vote for him, can't you?

[Gromit]

The idea of privatisation was to introduce competition into the market and result in lower bills. That has failed miserably and a shake up of the industry is long overdue.

The reason there isn't the competition anticipated is because the big companies generate as well as sell electricity. That means there is very little trading in electricity in an open market. They will generate enough electricity for themselves, and not sell it to competitors or at a discount.

Labour want to split the generating side from the selling side. The generating side would have to supply many firms who ask for their product rather than the one at present. The more firms trading would make proper competition and in theory lower prices.

At the moment the big firms have a monopoly on generation, and a cartel between themselves on a price. And the consumer is being ripped off. The key is to free the market up to genuine competition. This is an attempt to do just that.

I woyld be careful about dismissing the plan because it is a vote winner. I'm confident the Conservatives will steal this plan, or come out with a similar one soon.

[Milvus]

They could of course subsidise the cost, either from the taxpayers (which seems a little pointless) or by borrowing more money. It's done with fuel in Venezuela for instance. Cost of a tank of diesel here £95, in Venezuela £0.32p. Venezuela is going broke

[LazyGun]

No need to even introduce new legislation, in theory. OFGEM could implement price control mechanisms on the retail market right now, if they wanted to, much in line with what they do for the supply side. At the moment they do not, because everyone says competition is the best way of ensuring low prices. That is not what the evidence is suggesting right now though, with this particular marketplace.

[jomifl]

Gromit we don't know what the price of electricity would have been if the inustry hadn't been privatised. I do know that a power station known to me reduced it's staff from 500 to 100 after privatisation.

[LazyGun]

But we can see that competition has failed the consumer miserably, in the retail energy supply market, dominated as it is by 6 companies - all, incidentally also power generation companies. You could argue ( some do) that the current state of play would be the same as if the power companies were operating as a cartel - a sure sign that competition is not providing the consumer benefits it is supposed to.

[Gromit]

Milvus,
Venezuela is self sufficient in gas. It is one of the world's major exporters which accounts for half the country's GDP. They can afford to subsidise its own population because they are raking it in with exports. It is not going broke. They had a major banking crisis in the 1990s with most of the banks having to be nationalised. The economy was in ruins for a decade, but exporting oil gradually got them through it.

[Gromit]

Jomifl
Many power stations were closed altogether. The generating industry is undoubtedly more efficient than it was before privatisation. The contention is that because E-On generate the electric and then sell it to us, there is no incentive for them to make more electricity and sell it to 10 other companies who might then undercut E-On's retail price. Because they control the generation supply, they can keep smaller companies out and restrict competition.

[Bazile]

Question - When is a freeze not a freeze ?

Answer - When Dave ask the energy companies not to increase their prices before the next election .


erm - ok ,right

[anotheoldgit]

Gromit

/// The idea of privatisation was to introduce competition into the market and result in lower bills. That has failed miserably and a shake up of the industry is long overdue. ///

Wasn't it Labour who reduced the amount of power firms so reducing competition?

Gromit I do believe you live somewhere near Stoke on Trent, what are your feelings regarding Npower shedding 550 jobs in Stoke and sending them to India?

I cringed when I heard Paul Massara, Npower chief executive:state that it was all in the interest of the customer.

http://www.bbc.co.uk/news/business-25135247

[Bazile]

//Gromit I do believe you live somewhere near Stoke on Trent, what are your feelings regarding Npower shedding 550 jobs in Stoke and sending them to India? //

While Gromit responds or not , i'd just like to say i'm at this minute sitting opposite a colleague , who's wife is one of the 550 , who will be losing their job .

Very sad

[Milvus]

Gromit, I think you'll find their economy is still in deep trouble. Inflation has been above 27% for the last 5 years, debt is over 50% of GDP, stores are short of goods. But subsidising fuel keeps the President in place

[youngmafbog]

Unfortunately sending jobs to India is now part of the way things work. rightly or wrongly. I am more surprised it has taken them that long.

Not sure why Gromit has to answer to that?

[anotheoldgit]

youngmafbog

/// Not sure why Gromit has to answer to that? ///

Simply because Gromit has said in the past that he comes from that area, so I was just asking for his opinion on the job losses, who better to give an answer than someone close to the Company in question, nothing wrong in that is there?