Take big 5 energy firms into public ownership to ease cost of living, says TUC
The Trades Union Congress (TUC) today released a set of proposals for easing the cost of living crisis, triggered in part by the soaring costs of energy. According to the TUC, bringing the five biggest energy retail companies into public ownership would deliver a fairer deal for people on their energy bills.
The energy price cap was lifted in April 2022, causing people to experience over 50 per cent increases in their bills. A similar move in October could see households facing bills on average of over £3,000 per year. The rise in prices is primarily driven by the significant increases in the cost of energy following Russia’s invasion of Ukraine and a highly volatile energy market.
The TUC has argued that “other European countries have demonstrated that it is possible to insulate many or all households”, and that the UK government’s failure to do so stems in part from “who owns and controls our energy system, and whom it serves.” In addition the TUC has highlighted that workers in energy retail firms experienced real terms pay suppression equivalent to around £1,000 in the years 2019-21.
As a result, the TUC proposes taking the five largest energy retail firms – British Gas, E.On, OVO, EDF, and Scottish Power – into public ownership. The TUC proposals would also see the new publicly owned energy providers to introduce a social tariff capped at 5 per cent of income for low income households, as well as providing all households with an initial free energy allowance, going on to increase the cost per unit of households that consume more energy.
TUC General Secretary Frances O’Grady said, “Families should be able to afford their basic energy needs. But energy firms rinsed us for private profit in the good times, then doubled our bills when the going got tough. That’s why bills are soaring now.”
She went on to say it’s time to end the “failed privatisation” of the energy sector. She said, “It is time to lift the burden of failed privatisation off families. No more shareholder pay-outs. No more fat cat bonuses. No more take-the money-and run-companies that collapse overnight. Just fair prices from an energy company owned by us all and run for our benefit.”
The TUC’s proposals have been welcomed by public ownership campaign group We Own It. The groups director, Cat Hobbs, said,
Skyrocketing energy bills aren’t a fact of life, they’re a political choice. The TUC are absolutely right that it’s time to put public ownership back on the table. A publicly owned energy supplier could use surplus profits to protect itself – and the public – from energy crises like this, rather than pumping those profits out of the system and into shareholders pockets. It’s time to build an energy system that works for people, not profit.
The TUC’s proposals come on the same day that shadow chancellor Rachel Reeves confirmed that the Labour Party has abandoned its commitment to bringing energy into public ownership.
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Image credit: Johninnit – Creative Commons