May’s Energy Price Controls Savaged By Experts and Her Own Cabinet

Theresa May’s interventionist energy price cap has whacked share prices this morning: Centrica is trading at the lowest level for 15 months. The wonk world is savaging the policy:

Adam Smith Institute: “Freezing energy prices was a very bad idea when Ed Miliband proposed it. Yet two years after the electorate rejected it Theresa May is putting forward the same idea and rebranding it a ‘cap’. The facts on the ground haven’t changed, yet just like workers on boards and the living wage, Red Ed’s Zombie Policies are on the march.”

Institute of Economic Affairs:Introducing a cap on household energy prices would be a clumsy and counterproductive government intervention that could have an adverse effect on the energy market. A cap would likely backfire with companies finding some way around them: either by pushing prices higher now in anticipation of the cap or by increasing their lower prices to offset the cap at the top”

Centre for Policy Studies: “The claim that an energy price cap will save households £100 a year is by no means a guarantee. In fact, an intervention of this kind could be detrimental to competition in the market, meaning that this reform could end up doing more harm than good.”

Taxpayers’ Alliance: “Crude diktats such as this suggest that the government simply doesn’t understand the consequences of these ill-thought-out policies.”

Social Market Foundation: “Energy companies will inevitably recoup the costs of this cap elsewhere, which may mean higher prices for people who have shopped around and switched tariff to get themselves a better deal.”

CBI: “A major market intervention, such as a price cap, could lead to unintended consequences, for example dampening consumers’ desire to find the best deal on the market and hitting investor confidence.”

Market analysts RBC Europe: “This decision by May is clearly as much a political as it is an economic one. This intervention could create a worse deal for customers on average.”

Here were members of Theresa May’s Cabinet attacking Ed Miliband’s price cap in 2015:

Michael Fallon: “We have not seen intervention in industry on a scale like this since the 1970s when they tried to control the price of bread.”

Boris Johnson: “Miliband says he will imitate the catastrophic policies of the emperor Diocletian, by imposing a price freeze on energy bills for the 20 months succeeding the election.”

Don’t buy the Tory spin, this is the same sort of market intervention that caused the Tories to claim PM Miliband would lead Britain into a Venezuelan dystopia… 




Tip offs: 0709 284 0531
team@Order-order.com

Quote of the Day

Theresa May tells Bercow:

“Mr Speaker-elect, can I congratulate you on your re-election. At least someone got a landslide.”

Sponsors

Guidogram: Sign up

Subscribe to the most succinct 7 days a week daily email read by thousands of Westminster insiders.
Sun Cleared by Hospital Sun Cleared by Hospital
Exporters Order Books at 29 Year High Exporters Order Books at 29 Year High
Corbyn Refuses to Bow to The Queen Corbyn Refuses to Bow to The Queen
McDonnell Repeatedly Backed Far Left ‘Day of Rage’ Group McDonnell Repeatedly Backed Far Left ‘Day of Rage’ Group
“Soft” and “Hard” Brexit Terms Obsolete “Soft” and “Hard” Brexit Terms Obsolete
Hammond’s “Sound Money” Speech Sadly All Spin Hammond’s “Sound Money” Speech Sadly All Spin
Tommy Robinson Called British Muslims “Enemy Combatants” Tommy Robinson Called British Muslims “Enemy Combatants”
Corbyn Praised at London Hezbollah Rally Corbyn Praised at London Hezbollah Rally
Government Understaffed – Key SpAd Vacancies Up for Grabs Government Understaffed – Key SpAd Vacancies Up for Grabs
Sunday Shows Sunday Shows
Clive Lewis: “Burn Neoliberalism” Clive Lewis: “Burn Neoliberalism”
Corbynista Ultras Involved in Storming Kensington Council Corbynista Ultras Involved in Storming Kensington Council
CCHQ Already Preparing for Next Election CCHQ Already Preparing for Next Election
CCHQ Diverted Resources from ‘Safe Seats’ Tories Lost CCHQ Diverted Resources from ‘Safe Seats’ Tories Lost
Constituent Claims New Labour MP Called Her “Ugly B*tch” Constituent Claims New Labour MP Called Her “Ugly B*tch”
Corbyn vs Blair Corbyn vs Blair
How to Speak Like a Corbynista How to Speak Like a Corbynista
Told You So: 16 Times Guido Was May-Sceptic Told You So: 16 Times Guido Was May-Sceptic
10 Times Owen Jones Betrayed Jeremy Corbyn 10 Times Owen Jones Betrayed Jeremy Corbyn