Lib Dem Fun (3)

Just to round off the day by poking a bit more fun at the Lib Dems, as a footnote to their tax policies is this:

No to unfair bills. We will stop banks and energy companies raiding your pocket with unfair bills and charges. We will put a stop to unfair bank charges and make sure energy companies charge you fairly so people who use the least pay the least.

There's no hint as to how they distinguish between 'fair' and 'unfair' bank charges, or what they propose to do about them, so that's a fail, As to 'unfair' energy bills, let's not forget that top of the list of things that the Lib Dems stand for are these nuggets:

Environment Making real commitments to stop climate change

Economy A sustainable, green economy for Britain

Which almost certainly boils down to forcing energy companies to subsidise windmills and all the other 'green' tomfoolery, which, however you estimate it, will be passed on to consumers and will add hundreds of pounds to every household's annual domestic fuel bills. So on the one hand they are in favour of higher domestic energy bills but on the other hand they are against them.

Or is there some double-think at work here whereby energy bills would be 'high but fair' if the Lib Dems were in charge, as against 'high but unfair' under some other unspecified party? This is all EU-driven anyway, so I don't really see the point in having a policy on it at all, you might as well have a policy on changing the tides.

Another brilliant scheme

From The Metro:

Winter fuel payments for pensioners are an "unsustainable" response to fuel poverty and should be reconsidered, a report has said.

The Government's £2.7 billion-a-year budget for winter fuel payments might be better spent on lagging, insulating, reglazing and modernising the homes of pensioners who cannot afford to heat them properly, suggested the local government spending watchdog.

The Audit Commission said only 12% of people receiving the payments - worth up to £400 a year - are classed as being in fuel poverty. And it said that the payments do nothing to encourage energy efficiency and reduce the CO2 emissions blamed for global warming.

That appears to be half a step in the right direction, but as I said a day or two ago:

"If you increase taxes on [domestic fuel]... then home insulation becomes more attractive anyway by comparison, and if they scrapped all this loony 'extra investment in renewables' as well, then there'd be plenty of extra money for cutting vehicle excise duty, increasing the tax-free personal allowance or old age pensions so that the average user is no worse off..."

At present, the Winter Fuel Voucher is just extra State Pension. It's a bit of a gimmick (which not just add £4 to the weekly basic state pension and have done with it?) but hey. But if they stop paying it, and spend the money on insulating pensioners' homes, who would benefit more? A granny in an ex-council flat, which has neither cellar nor loft-space to be insulated; or another granny living in a three-bed semi?

If you accept MMGW as a given, then the Audit Commission's suggestion seems sensible. But if you are like me, and you neither believe in MMGW nor do you believe in subsidies (whether to the home-insulation industry or to owners of larger homes), the Winter Fuel Vouchers actually make far more sense.

'Time for action' on fakecharities

The BBC have re-heated an article from a year and a half ago titled UK mulling fuel poverty voucher, only this time it's titled 'Time for action' on fuel poverty:

A charter aimed at ridding Wales of fuel poverty by 2018 is being launched by charities and consumer groups. Campaigners say one in four Welsh households - 320,000 - experience fuel proverty, meaning they have to spend 10% or more of their income on heating. The chair of the Wales Fuel Poverty Coalition said they have united to say "now is the time for action".

In case the words 'charities', 'campaigners' and 'coalition' don't set alarm bells ringing, a quick squizz at National Energy Action's 2008 accounts shows their main subsidiary Warm Zones Limited received £12,210,580 from the government or local councils in the year (note 5, page 11), as well as £2,797,939 in grants from various government departments/local councils, including £2,285,287 from the Department of the Environment, Food and Rural Affairs (note 6, page 12). It had also built up a nice pot of £6,340,233 by the year end (Cashflow statement, page 9 - the column for 2008 is incorrectly headed 2007, natch).

The whole thing is bizarre. The government has been paying these people for years to 'campaign' for an end to fuel poverty and to subsidise home insulation, while simultaneously ensuring that domestic fuel prices - for example all the 'extra investment in renewables'*, the 5% VAT and allowing the gas suppliers to run a cartel (actually, I'm not sure whether they do, I have asked the expert in the comments here).

There's no need to make it so complicated! If you increase taxes on gas (preferably at the import stage rather than at point of end-use, like VAT), then home insulation becomes more attractive anyway by comparison, and if they scrapped all this loony 'extra investment in renewables' as well, then there'd be plenty of extra money for cutting vehicle excise duty, increasing the tax-free personal allowance or old age pensions so that the average user is no worse off (on a static basis) but putting a downward pressure on usage/encouraging people to insulate their homes.

* One of the dozens of other quangos that competes in this area is the Energy Savings Trust, which cheerfully admitted that [Annual domestic] Energy bills could go over £4,000 by 2020

Oh G-d, it just never stops (3)

Fresh on the back of the government's lunatic scheme to add twenty or thirty per cent to household fuel bills as part of a vain attempt to turn the economic clock back two centuries (see previous post), comes this from the BBC:

Rising unemployment and higher energy prices are likely to push hundreds of thousands more homes into fuel poverty, a key government advisory body says. The Fuel Poverty Advisory Group (FPAG) says about 4m households in England are already in fuel poverty, spending more than 10% of their income on energy. And it has urged ministers to set out a detailed plan for meeting their own target of ending the problem by 2016. The government says it has spent £20bn on cutting fuel poverty since 2000...

NB, £20 billion divided by nine years divided by 4 million households = £555 per household per annum, which is bugger all compared to the £16,000 it intends to take from each and every one of us and channel into the hands of whichever "green technology" companies have been lobbying hardest in Brussels and Whitehall.

"Climate change hits poorest Brits"

From The Metro:

The poorest people in the UK will be hit hardest by climate change, a report warned. A study by a coalition of environmental and social justice groups said one in five people still lived in poverty in this country, often unable to afford to heat their homes or eat healthily.

The impacts of rising temperatures will affect them most, as they tend to live in lower quality, less energy-efficient housing, have ... less money to adapt to higher prices of fuel and food.

Does not compute!

If we were worried about falling temperatures, with a consequently higher demand for fuel and more crop failures, then yes, the poorest would probably be the hardest hit. But if temperatures are indeed rising, then surely that will reduce demand for fuel for heating and we'll need less of something that is cheaper?

Let's also not forget that "The cost of meeting EU green goals is set to add an extra 20% to the average gas and electricity bill, according to new research..."

The People Who Don't Matter

From The Metro:

Adair Turner, chairman of the Committee on Climate Change, has predicted sharp rises in energy prices as he called for cuts of at least 34 per cent in Britain's carbon emissions by 2020. He said these higher electricity and gas prices could push another 1.7 million households into fuel poverty by 2022...But it added that 400,000 households could be lifted out of fuel poverty by energy efficiency measures in their homes...

Lord Turner said: "Climate change poses a grave threat to human welfare... The reductions required can be achieved at a very low cost to our economy: the cost of not achieving the reductions, at national and global level, will be far greater."

Shouldn't that read "Pork barrel spending associated with measures taken to deal with non-existent climate change poses a grave threat to human welfare"?

And how, if at all, does The Committee on Climate Change respond to headlines like "Arctic blast sweeps across Britain"?

"Fuel help may end up on bills"

Tee hee, so they've finally noticed!

Warm words

Sometimes it's difficult to know where to start with propaganda like this, but let's pick up the thread here ...

The government says its aim is to insulate every home in Britain by 2020 - and energy companies, councils and voluntary organisations will be making door-to-door visits in deprived areas to promote the scheme.

1. Nulab will be out of gummint in two years' time at the latest, by 2020 they'll be an unpleasant memory.

2. The poorest people live in council flats. If councils want to insulate their blocks of flats properly, then good luck to them. From the point of view of a tenant, with a concrete floor, walls and ceiling, there aren't any 'loft spaces' to insulate, and they probably can't afford double glazing (even if that were an economically rational thing to do, which it isn't in most cases).

3. Just look at the list of meddling quangocrats and lobbyists in that article who'll be slathering over this; Warm Front (the BBC try to throw you off the scent by not capitalising it, Warm Front themselves try and throw you off the scent by having a co.uk rather than a gov.uk URL); the people at the Benefits Agency who decide who does and who doesn't qualify for the means-tested £25 a week; councils and voluntary organisations who'll be making the visits; the manufacturers of double glazing and lagging who think they're in for a taxpayer-funded bonanza; Help The Aged; the trade unions (foremost Unite); the National Housing Federation, who "represent 1,300 not-for-profit housing associations in England and campaign for better housing and neighbourhoods" (some of the UK's biggest subsidy junkies who are keen to get the taxpayer to shovel yet more money at them to enable them to do up their properties) i.e. not to be confused with the Home Builders' Federation, who can see a pretty taxpayer billion or three rolling their way but were too polite to mention it.

4. "Door-to-door visits"? Hmmm, now why does that phrase fill me with dread?

The BBC don't appear to have included soundbites from their taxpayer funded chums at Greenpeace or Friends of the Earth, but there's only so much crap you can squeeze into one article, I suppose.

"Gas bills to top £1,000 a year"

... says the man from Centrica.

"Price of gas to rise", say the men who set the price of gas.

When you've finished laughing, you have to see this in the context of my previous post - expectations of price rises are self-fulfilling, as are expectations of price falls.

And what's this 'fuel poverty' crapola all about? For a start, they could scrap VAT on domestic fuel (once we've left the EU) and they can forget all about this nonsense about sticking extra taxes on it to pay for windmills. Handing out 'fuel vouchers'? Isn't that a subsidy that will increase demand, hence prices, and hence have the effect of dragging those people who don't qualify for the vouchers (i.e. people who saved up for their retirement) into 'fuel poverty'?

"Measures to target fuel poverty"

For a load of shit ideas dreamed up by a long list of quangos, see here.

Or, from the MW manifesto:

1. Scrap VAT on domestic fuel* (and possibly reduce other taxes thereon). That gets the cost down by 5% at a stroke.

2. Encourage/enable pensioners and welfare claimants to set up a low-cost, basic bank account (any bank that refuses to offer such accounts gets its banking licence withdrawn). Encourage them (i.e. tell them how much cheaper it is) to pay by DD rather than pre-payment meter. That gets the cost down by a further 16%. DD payments can be made weekly or monthly.

3. Replace Council Tax/SDLT etc. with a Property Bubble Tax, and replace means-tested old-age benefits with a Citizen's Pension, which would encourage** the one million pensioners below the poverty line who still live in a three-bedroom house to trade down into a smaller home.

* Actually, phase out VAT on everything, but this would go first.

** Or at least not discourage which is what means-tested benefits do - if you swap big house for small house-plus-pile of cash, you lose so much in Pensions Credit and Council Tax Benefit that it often isn't worth the hassle. And SDLT of course disourages mobility.

"UK mulling fuel poverty voucher"

Ooh! Big numbers! And where there's a big number, there's a f***witted idea not far behind, in this instance, a windfall tax to fund fuel vouchers for those in 'fuel poverty'.

Hmm. British Gas' domestic energy division has 10m gas customers and 6m electricity customers (see end of here). So those £571m post-tax profits (which are after paying corporation tax at 50% or 75% don't forget!!) are, er, £35 per household per annum (or £70 if you get gas and electricity from British Gas).

The spokesman for the oil industry points out (see first link) that the government is already getting £1,000 million from households in VAT on domestic fuel = £40 per household per annum, and politely doesn't mention "as much again in bloody corporation tax".

So how about this for a plan ... if 75% tax ain't high enough, levy a 100% windfall tax and give everybody a £35 'fuel voucher' ... oh ... that's no good ... the industry would shut down and we'd have to go without gas or electricity altogether. Hmmm.

Truly, f***wittery of the highest ordure!

Oh, and as is tradition on this 'blog, let me point out that National Energy Action, Charity No. 290511 (mentioned in the first link) is not a group "which helps people on low incomes", it's a f***ing quango. It gets a cool £2m in grants from various government departments (see note 6 to the accounts). Its subsidiary Warm Zones Limited, gets another £9m from the government. Heaven knows whether poor people ever see any of that money.