The Wonderful World of ‘Competition’

The recent outrageous further round of price hikes from power supply companies will have a severe impact on a wide range of people particularly, but by no means only, the millions already in desperate fuel poverty.

Average bills, already well into four-figure territory, will be pushed much higher still. The fuel companies benefit from a so-called ‘market’ where the main inter-company rivalry is about getting away with additional charges and inflated prices, making more profits, taking bigger bonuses and treating people as monetary cannon fodder. Another example, as if we needed it, of the wonderful world of competition.

Like banks and other notorious and parasitic sections of business today, they operate in effect, quite legally, as an informal cartel. They set their prices and margins in the same way and take it in turns to hike prices according to what they think they can get away with. Whether it’s gas, electricity or petrol, one thing is certain, unless there is official action these outfits will be getting a way with a lot more of your money and mine and their profits will not suffer one bit as a result.

Still, at least we needn’t lose sleep at night worrying about their oh-so-vital-to-the-economy executives’ remuneration or their shareholders profits - they at least will be comfortable in success or failure and can look forward to a tax cut next year. Even if pensioners can’t afford to keep a room warm, the board members will still have plenty of money to burn!

I would love to see a publicly owned exemplar company set up making fair, consistent and simple charges – some hopes! Failing this, in my opinion there should be frequent windfall taxes on fuel, power (and other) profiteering – the only questions should be about the extent and the use of the proceeds. It is clearly wrong that companies should make fat and inflated profits while people struggle to make ends meet, faced with rapidly rising costs for heating and other essentials such as food or even hanging on to their own homes.

Fuel and power supply are dominated by a small number of firms that are allowed in turn dominate you and me. These industries are classic ‘oligopoly’ structures, the shortcomings of which were once well understood. Industry ‘regulation’ in all quarters has been weak under successive governments and will remain so.

The exhortation to ordinary people to ‘shop around’ is worth little over time. It has been found out that a third of switchers make themselves worse off. And do they think that elderly and now vulnerable people who have built the country up should be spending their retirement time ‘switching’ between fuel companies (and banks) to reduce the extent to which they are exposed to highway robbery?

It is no defence for these organisations to retort that they are operating globally. Who has paid to make their fat global profits possible in the first place? We have! We’ve already paid ‘global’ companies with the British jobs they have exported and the higher prices they extract from us for the same products sold in other countries. This has fattened their profits and we’re entitled to a return on that too!

Since privatisation, foreign owned firms with even less concern for people in this country, sell North Sea gas to themselves during the summer for storing in Europe and reselling here at higher prices in the winter. Those companies who use (by whose consent?) the label ‘British’ should be made to act as if they were. Big business in general should not be a morality-free zone. They should think of those who have to eke out a small pension. They talk about their tough choices. How would they like to try the really tough choice between food and warmth?

Those who take big from society should also give back in comparable measure. Long gone are the days when those in near monopoly positions could be relied on to do this to some extent on their own account – or to be socially responsible and patriotic in the first place. So they need now to be taught how to be generous – or even pay their taxes. That would certainly be one way to create a warm glow all round!