Friday, September 05, 2008

Why renationalisation- not a windfall tax is the answer to energy profiteering


From The Campaign for Public Ownership:

Calls for a 'windfall tax' are sure to increase following the news that the 'Big Six' energy companies hiked their shareholder dividends payouts by 19% according to new research. The suppliers paid £1.64bn in dividends in 2007, £257m more than in the year before, a study commissioned by the Local Government Association found.

While calls for a windfall tax are understandable, the Campaign for Public Ownership believes that the only long-term solution to the problem of energy company profiteering is to restore the energy companies to public ownership.

The problem lies in the ownership structure of the energy companies. All of them are Public Limited Companies, whose overriding aim is to maximise profits for shareholders. That's what PLCs do. Instead of reacting with horror to the entirely predictable news that PLCs are putting the interests of shareholders before Britain's long-suffering energy consumers, we should instead be calling for the government to take the one step that will lead to lower energy prices in the long term. Restoring the energy companies to public ownership will mean that prices can be lowered, as there will be no shareholder dividends to pay.


Martin Meenagh has more on why we need public ownership of our energy companies- and not a windfall tax, here.

9 comments:

David Lindsay said...

And public ownership is British ownership. If you don't believe in public ownership, then you don't really believe in national sovereignty, so that you are not a conservative.

Neil Clark said...

Public ownership of the utilities and energy companies, public transport and our national infrastructure is an issue which can unite all true socialists, all true social democrats and all true conservatives. It shows you how far down the extremist neoliberal road we have travelled when none of our main three parties is offering renationalisation- whereas thirty/forty/fifty years ago they all supported public ownership. Whatever would Harold MacMillan say if he saw how far the post-war consensus on public ownership has unravelled. He attacked Thatcher for 'selling off the family silver' but he would have expected Labour, when they eventually returned to power to remedy the situation. The fact was that the Tory govts 1951-64 and 70-74 were far to the left of New Labour.
If he were alive today Harold MacMillan would be denounced as a dangerous left-wing revolutionary.

olching said...

I agree completely. The fact that commodities such as energy and water are no longer in public ownership is disgusting. As was pointed out companies are there to make money and are not primarily concerned with supplying energy (other than for profit maximisation purposes). Companies are not our friends. It's that simple.

As far as the three parties are concerned, they are the epitome of 'globalisation with a human face'. It should be resisted at all costs.

Your point about MacMillan being denounced nowadays as a "dangerous left-wing revolutionary" (loved that), you're absolutely right: The concept of redistribution is totally absent from political discourse.

I was on CiF today, and some Green was talking about revolutionary change. The comments that followed highlighted that very problem. She got quite a bit wrong, but she seemed - at least - to understand that the Monbiots et al are not revolutionaries, but are the status quo. What passes as 'radical' and 'revolutionary' nowadays is truly frightening.

Why? Because globalisation has been introduced by stealth; the pretence surrounding welfare is a front for (and I'll gladly reuse that gem by Zizek): 'Globalisation with a human face', facilitated by the spread of neoliberalism.

Neil Clark said...

Totally agreed, Olching. And things have got worse with Clegg taking over the Lib Dems- who should now be renamed the 'Neo-Lib Dems'. The Lib Dems commitment to renationalise the railways, which was in their last manifesto, has been quietly dropped, despite public support for such a policy rising! It shows the grip that global capital has on all our parties.
If McMillan's Tories came back to life today with their Keynesian mixed economy views and support for progressive taxation they would be denounced as dangerous extremists. That's how far we've gone down the neoliberal road.

neil craig said...

Would this be nationalisation without compensation aka government theft? If so I disapprove.

If not does the payment come from us as taspayer or from us as customer? If the latter then how will the promised lower prices be achieved.

In fact fuel poverty is entirely caused by the government. It is them who, for decades, have prevented the construction of new nuclear which could be supplying us with as much electricity as we want at half the curent price.

Is there any evidence at all that a renationalised industry would not be even more under the control of the Luddites in government.

Roland Hulme said...

From the general tone of your writing, I think you'd agree that the present British government couldn't organize a proverbial in a brewhaus.

Yet it's this SAME government you want to hand over public companies too!

Can you spot the contradiction?

Nationalisation is a joke, just like socialism as a whole. Pragmatic neglect of the majority and insepid cronyism within those in charge.

Neil Clark said...

Roland- there's no contradiction. When I say I'm in favour of public ownership, I don't mean that the industries in question will be run directly by the likes of Hazel Blears and Alistair Darling. As for nationalisation- and socialism- being 'a joke', I take it you've never been to Norway. Oh so unsuccessful, aren't they!

neil craig said...

"I don't mean that the industries in question will be run directly by the likes of Hazel Blears and Alistair Darling."

No but they will be run by their appointees & subject to decisions being made on an economically insane but politically useful basis. Socialism may work when you have a strong, competent leader unworried by Parliamentary pressure like Stalin or Lee Kuan Yew but not otherwise. Where government has enormous amounts of oil like Libya or Norway or Venezuala they may be able to afford more government thannthey would normally pay for but it is the oil, not the goverment, which causes the wealth.

Roland Hulme said...

"Socialism may work when you have a strong, competent leader unworried by Parliamentary pressure..."

By 'parliamentary pressure' you mean 'democracy.'

Neil - actually I lived for a very short time in Norway. About 30% of their listen companies are owned by the government - but that's not the explanation for the quality of life. It's because Norway is the third largest oil exporter in the world and has the second highed GDP per capita in the world.

Small population + very rich = happy. Also, they wisely kept out of the EU.

It ain't rocket science. And it sure as hell ain't socialism.