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Energy firms should pay windfall tax - MP



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Published Date:
29 August 2008
A ministerial aide from West Yorkshire is among a growing number of Labour MPs demanding Gordon Brown slap a windfall tax on the record profits being enjoyed by energy companies.

Around 70 MPs have called on the Prime Minister to use a one-off levy to help elderly and vulnerable people pay their soaring gas and electricity bills.

A handful of Parliamentary Private Secretaries have also backed the campaign, including Wakefield MP Mary Creagh.

Although not ministers, PPS's are on the Government payroll and expected to back government policy.

Anger has grown that gas and electricity bills have soared while the "big three" energy firms – Shell, BP and British Gas – have posted massive profits over recent years.

Centrica, which owns British Gas, recorded profits of £992 million in the first half of this year, while still raising prices by 35 per cent.

Many MPs point out that there is a precedent for a windfall levy – New Labour used its first budget in July 1997 to slap a one-off tax on the unearned profits of the newly privatised utilities.

Ms Creagh, who is Culture Secretary Andy Burnham's PPS, said: "I support the idea of a windfall tax in the same way I supported what the Government did in 1997.

"That was about the redistributing the excess profits of utility companies to fund training for people who had been long-term unemployed.

"Ten years on and we have energy companies making the same, if not greater, profits and ordinary working people clearly feeling the pinch and feeling inflation in their gas and electricity bills over the course of a year that is almost unheard of.

"For me it a matter of equality and social justice. These are extraordinary times and extraordinary measures are called for."

Leeds North East MP Fabian Hamilton first tabled a parliamentary motion in January and has subsequently written to every member of the Parliamentary party urging them to contact the Chancellor, Alistair Darling.

He said: "When the price increases, these companies' costs do not increase but their profits do. The people who suffer most are those who can least afford to pay.

The full article contains 362 words and appears in EP Leeds First & County newspaper.
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  • Last Updated: 29 August 2008 8:33 AM
  • Source: EP Leeds First & County
  • Location: Leeds
 
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Brad2,

Leeds 29/08/2008 22:28:32
These two Labour MPs - Mary Creagh and Fabian Hamilton - have got it completely wrong.

Firstly, it is too late now to try to undo the damage that has been done to the UK economy because of energy costs. How come our electricity wholesale prices are nearly FOUR times those of France? Answer: Lack of planning, investment and strategy by the government. Targets for everything, but the economy is on its knees!

Secondly, cries of 'social justice' are completely misplaced. Unless the government very quickly gets to grips with the closure of businesses - including some moving overseas due to the tax, tax, tax policies of New Labour - there are going to be massive numbers of unemployed people having to be supported by the state.

A £300 increase in energy costs for a working family is serious for sure, but a £10,000 increase that shuts a factory and puts 50 workers on the dole is a disaster.

It's difficult to see how we can get the message through to New Labour - so few of them have any experience or understanding of business and wealth creation. The future looks very bleak.
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