Nationalise the energy companies to end fuel poverty

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PM Brown has rejected out of hand the trade union demand for a Windfall Tax on the oil, gas and energy companies, that are making billions of profits, so as to alleviate the plight of workers, the poor, and the pensioners. Many of these will not be able to afford to keep themselves warm this winter, when not only the elderly will die of hypothermia.

Instead he has brought in a number of petty measures to assist in the insulation of homes, plus a this-year bill freeze for the very poorest people. The total cost, to be born by the energy industries, will be just over £900 million.

These measures have been condemned right across the political spectrum as completely inadequate when energy prices have gone up by over 30% in a year, and food prices by a similar amount.

Right-wing Labour MP Frank Field commented that after a summer spent ‘roaring about the package’ the government has produced ‘a mouse’.

Left Labour MP, Alan Simpson, chairman of the Parliamentary Warm Homes group, said that an extra £74m pledged towards the Warm Front insulation scheme just reversed existing cuts to its budget.

Even the gas and electricity watchdog Energywatch said the response to growing fuel poverty was ‘too little, too late’. Its Chief executive Allan Asher said that ‘the lack of political will to tackle fuel poverty is not just disappointing, it approaches negligence.’

This is a grave charge indeed, when many elderly people will die because of this alleged negligence.

Help the Aged described the package as ‘flimsy and failing’, while the Unite union leader, Tony Woodley, said bigger steps were needed including a windfall tax on the oil and energy companies.

The problem is that the Brown government is concerned only with securing the future of capitalism, its banks especially, and considers that the mass of the working class and the middle class will have to tighten their belts and produce whatever value is necessary to prop up the banks.

Brown has already handed up to £200 billion to the banks in return for their dodgy mortgages, to give the big banks the working capital to keep going.

Now he is thinking of extending this life support scheme for the bankers, to the point where even the Bank of England is seriously worried that the bankers will become permanently dependent on the state, a road that leads directly to state bankruptcy.

Giving evidence to the House of Commons Treasury select committee on Thursday, BofE governor King said that plans to extend the Special Liquidity Scheme (SLS), which allows banks to swap mortgage debt for Treasury bonds, are a limited measure.

He stressed that the central bank was ‘not a magical piggy bank’ for mortgage lenders, and that ‘it is not the purpose of central bank liquidity insurance to provide a source of long-term funding to the financial system, indeed it cannot do that.’

King warned: ‘If the government were to guarantee mortgages or set up a public-sector mortgage bank to provide mortgages directly, what that would do is totally undercut the incentives private-sector banks had to get their own balance sheets in order.’

Brown’s zeal to prop up banks has even got the Bank of England worried!

Now, Business Secretary John Hutton has had to admit that he will not be able to stop energy firms increasing bills to recoup the £900 million cost of Labour’s petty measures.

David Porter, chief executive of the Association of Electricity Producers, commenting about the £900 million measures, stated: ‘It remains to be seen just how much of it ends up on the customers’ bill in the longer run. Whenever people impose costs on an industry like ours the bill, to some extent, always ends up with the customer.’

That’s it: the working class is going to pay even for the petty measures that are meant to be bringing slight assistance to it. The profits of the energy companies are sacred!

There is only one way forward in this situation that is loaded against the working class. The trade union leaders must be forced to call a general strike to nationalise the energy companies – oil, gas and electricity.

This is the only way to slash energy prices and save the lives of large numbers of people next winter.