UK Energy Costs

Chris Law Excerpts

Thursday 8th September 2022 Commons Chamber

[Barry Gardiner]

rose—

[Chris Law (Dundee West) (SNP)]

rose—

[Ian Blackford]

I am going to make a little progress, because I am conscious that others want to get in.

The frightening thing is that the new Prime Minister made that choice on day one in the job. On day one, we saw the pound slip to a low not seen since the Thatcher years, knocked by the UK’s worsening economic outlook. Her first major decision as Prime Minister will prioritise big business profits over family budgets, and we can already predict that the Truss tax, which will be paid for by households for years to come, will be her enduring legacy. It will eat away at household budgets long after she and her party have been voted out of office. If day one was that bad, we cannot blame people for fearing that the worst is yet to come.

The decision not to bring in an additional windfall tax is the biggest and worst political choice in the plan. Let us look at Shell and BP as an example. I want corporates to be profitable and to be able to invest to create jobs and to finance a green transition, but there is a difference between a fair profit and an excess windfall or excess profit. Shell’s first half profits were up by 177% to $25.2 billion. It made excess profits to such an extent that it bought back shares worth $8.5 billion and declared that it would buy back a further $6 billion of shares between July and September. If we want an example of where excess profit is, it is there. In total, that means that $14.5 billion of excess profits will not be invested in green energy projects—money that has been generated from the high energy prices that our constituents and our businesses have to pay. That is the reality.

BP’s quarter 2 profits were up from $3.1 billion to $9.2 billion, and there is a share buyback for this quarter of $3.5 billion. It will frankly disgust our constituents that that money is being given back to shareholders when people simply cannot afford to put their heating on. They are global corporates, but we can and should fairly tax their UK activities, so why on earth is the Prime Minister failing to bring in a fair windfall tax? Why will ordinary people across these islands ultimately have to foot these bills? Why does her plan not address that real issue?

This energy plan is defined not only by the choice to make the public pay, instead of the excess profits of massive corporations, but by its glaring omissions. There is no proper plan to help those who are already struggling. Support needs to be targeted to low-income households and those negatively affected by spiralling costs, such as unpaid carers, larger households and disabled people.

In Scotland, we are already prioritising support to the most vulnerable. The Scottish Government are doing what they can by freezing rents, banning evictions, freezing train fares and expanding free school meals to primary 6 and primary 7. That is a Government acting with compassion.

[Chris Law]

I thank my right hon. Friend for making the most valid point that for generations to come, working people across these islands will be paying for this borrowing for excess greed. The UN Secretary General has described it as utterly “grotesque” and “immoral” to be making excess profits on the back of fossil fuels. What I have heard from the Government is more of the same. My question is whether the Government have, despite their ideology that profits must be made regardless, put any conditions on those excess profits and on what those companies will do to invest in a rapid transition to save future generations from the climate catastrophe.

[Ian Blackford]

My hon. Friend is absolutely right. In that context, we are doing what we can with the devolved powers that we have.

I say to the Government that one thing we have done is to introduce the game-changing Scottish child payment, which will increase to £25 a week and lift 50,000 children in Scotland out of poverty.