Public Ownership of Energy Companies

Debate between Margaret Ferrier and Margaret Greenwood

Monday 31st October 2022 Westminster Hall

[Margaret Greenwood (Wirral West) (Lab)]

It is an honour to serve under your chairmanship this afternoon, Mrs Murray. I pay tribute to everybody who has signed the petition.

Energy is a necessity for all of us, yet people are at the mercy of big business when it comes to deciding who can afford to heat their homes or run their businesses. Profits at the world’s biggest oil companies have soared to nearly £150 billion so far this year. At the same time, as the e-petition acknowledges, people are having to choose between heating and eating. That cannot be right. As Lord Sikka has written:

“It is Christmas every day for oil and gas companies, and their shareholders and executives are laughing all the way to the bank, leaving the rest of us to pick up the cost in higher energy prices, inflation, bankruptcies and a deepening cost of living crisis.”

Labour called for a windfall tax on oil and gas back in January so that some of the eye-watering profits that are being raked off by big business could support people to pay their bills. However, it took months for the Government to U-turn and follow Labour’s lead, and even then the then Chancellor, now Prime Minister, could not resist resorting to his instinct to put big business first and everyone else last. He allowed those energy giants to shield most of their profits from the very levy that he was announcing. The Energy (Oil and Gas) Profits Levy Act 2022, which the current Prime Minister designed, allows energy companies to apply tax savings worth 91p in every £1 invested in fossil fuel extraction in the UK. Promoting fossil fuel extraction instead of investment in renewables is irresponsible as we face the climate emergency, and it is an insult to young people and to future generations. Labour has called for the tax to be tightened to remove the option for energy firms to claim tax relief on 91% of the levy if the money is reinvested.

It is notable that, during the passage of that Act, the Government voted against a Labour new clause that would have required an assessment within three months of the Bill becoming law of how much extra revenue would have been raised if the levy had been introduced on 9 January 2022 rather than 26 May 2022. The 9th of January is significant because that is when Labour first called for a windfall tax—four and half months before the Government came forward with their U-turn. Why did it take the Government so long to act? I would be grateful if the Minister could respond on that point. There have been reports over the weekend that the windfall tax on energy companies could be raised to 30% and extended by three years. Perhaps the Minister could give us more information today, and let us know what discussions have taken place about that in Government.

It is clear that there is a need for long-term change where energy is concerned. As the independent campaign group We Own It has highlighted, of the top 10 countries in the world that are leading the energy transition to renewables, only the United Kingdom does not have a publicly owned renewable energy generation company. Of those that do, Sweden owns 100% of Vattenfall, one of Europe’s largest producers of electricity and heat; Norway owns 100% of Statkraft, Europe’s largest renewable energy producer; Switzerland owns 100% of Axpo, the country’s largest producer of renewable energy; Iceland owns 100% of Landsvirkjun, the country’s largest electricity generator; and France will soon own 100% of EDF, a world leader in low-carbon electricity generation and a company that many of us in this country use—despite the fact that the French people will own 100% of it fairly shortly. The other countries—Denmark, Austria, Finland and New Zealand—all own at least 50% of renewable energy generation companies.

There is a lot of public support for the United Kingdom to go down a similar path. There are no profits for shareholders in a publicly owned energy company. A poll for We Own It, carried out by Survation, found that 66% of those surveyed wanted energy in public ownership. Earlier this month it was reported that a YouGov poll found that 55% of more than 1,700 adults who were surveyed across Great Britain favoured public ownership of energy. In August, a poll by 38 Degrees found that 73% of voters would favour temporarily renationalising energy companies if they cannot offer lower bills.

Public ownership of services is understandably popular, whether that be energy, water, buses, trains or the NHS. The NHS has been massively opened up to the private sector on the Conservative’s watch, with billions of pounds of taxpayers’ money being handed to private companies to treat NHS patients. Privatisation is never a guarantee of quality. According to a study by the University of Oxford, private sector outsourcing in the NHS corresponded with significantly increased rates of treatable mortality, potentially as a result of a decline in the quality of healthcare services.

To return to energy, Common Wealth reported recently that 72% of voters think it is a good idea to set up an energy company that is Government owned and aims to create low-cost environmentally friendly energy. Labour has announced a plan to establish Great British Energy, a new publicly owned, clean-generation company that will harness the power of the sun, wind and waves to cut energy bills and deliver energy security and independence for our country, as well as good, secure, high-paid jobs.

[Margaret Ferrier]

On that point, in September, in response to a written question on an impact assessment for nationalisation, the then Minister, the right hon. Member for Beverley and Holderness (Graham Stuart), said:

“The Government does not intend to make such an assessment. Nationalisation will not solve the current challenge of high global fossil fuel prices and the impact this is having on the cost of energy.”

Does the hon. Member agree that it is difficult to see how Ministers can speak with such certainty if they will not even make a full assessment?

Backbench Business

Debate between Margaret Ferrier and Margaret Greenwood

Thursday 16th March 2017 Westminster Hall

[Margaret Greenwood (Wirral West) (Lab)]

It is a pleasure to serve under your chairmanship, Mr Walker. I congratulate the hon. Member for Glasgow South West (Chris Stephens) on securing this debate. He spoke passionately about the haphazard nature of the closures, and described it as a Google Maps exercise done on the back of an envelope. He also spoke about the loss of jobs and the impact on the local economy. It has been a very important debate, even though we have already had several debates on this issue.

We have had some excellent contributions, particularly from my hon. Friend the Member for Lewisham East (Heidi Alexander), who made a measured speech about the impact on her constituents and the Government’s complacency on the economic consequences of Brexit for the financial sector, on which many of her constituents rely. The hon. Member for Inverclyde (Ronnie Cowan) spoke about practical problems, such as flood risk and the impact that might have on people being sanctioned. The hon. Member for Rutherglen and Hamilton West (Margaret Ferrier) talked about the cumulative impact in her constituency of other closures, such as those of local banks.

My hon. Friend the Member for Sheffield, Heeley (Louise Haigh) represents one of the most deprived areas of the country. She asked the Minister why we should be asked to support the measure, given that we have not been given the evidence base or any impact assessment. My hon. Friend the Member for Barrow and Furness (John Woodcock) made some very good points about the remote geographical location of his constituency and the loss of expertise for Jobcentre Plus. My right hon. Friend the Member for East Ham (Stephen Timms) spoke about the doubling of public transport fares for people in his constituency. There were also contributions by my hon. Friend the Member for Coventry South (Mr Cunningham) and the hon. Member for Coatbridge, Chryston and Bellshill (Philip Boswell).

Many questions still need to be answered. The Government appear to believe that the current levels of employment and the introduction of universal credit mean that more than one in 10 Jobcentre Plus offices can be closed, regardless of the impact on the local community. According to House of Commons Library analysis, 33% of jobcentres in London, 18% of jobcentres in Scotland and 16% of jobcentres in the north-west will be lost at a time when communities are already under real pressure due to seven years of Tory austerity.

Jobcentre Plus faces considerable challenges in the immediate future. From this April, it will play a much greater role in directly providing employment support when new referrals to the Work programme cease. From the end of this year, the Work programme and Work Choice will be replaced by the Work and Health programme. Most people claiming JSA are currently asked to take part in the Work programme, while Work Choice provides specialist employment support for disabled people.

[Margaret Ferrier]

Does the shadow Minister agree that it is about not only the expertise of jobcentre staff in carrying out their role, but the rapport built up between them and the clients? That is even more important when dealing with those with mental health issues, where continuity is crucial.