Energy Prices

[az city]

And what is the difference in principle between borrowing for Covid to try and mitigate an economic catastrophe and doing so for energy bills that would also create an economic catastrophe?

Jimbo, you really don't see the difference? You don't think energy providers are profiteering and should pay as a result?

[az city]

Ive been driving around today a lot with the radio on, its been a long work day ( 6am till 10.30 pm ) I needed to catch up after my holibobs ( and pay for it )

I heard the news about the Price cap set at £2500 for 2 years, thought, thats not at high at £3500 for Oct, 5500 for Jan and 6600 for April 23, so well done the government, they have done something to help the situation

I then thought, I cant wait to see how the " CCMB left " have reacted to the news, of course its good news that its 2500 rather than over 6600 inside the year, it might not be ideal, but its better than leaving the mess run, but the Tories have done it, so its going to be bad, at least it'll be a good read

I was right

You shouldn't be so smug. All Truss did was to delay YOU having to foot the bill (through increased taxes) in the future.

[blue matt]

You shouldn't be so smug. All Truss did was to delay YOU having to foot the bill (through increased taxes) in the future.

True, I know that, but it was better than not doing anything and ignoring the situation ( which appeared to be happening )

[SLUDGE FACTORY]

FT's editorial on it:
https://www.ft.com/content/b5dbef50-...6-cb1ee2682953

Liz Truss dislikes “handouts”, but she has shown a welcome readiness to be flexible when overwhelming need dictates. British families and households finally have some clarity that substantial support in paying crippling gas and electricity bills is on its way. The new prime minister’s bold package, including an energy price guarantee, is estimated to cost £150bn — more than double the Covid-19 furlough scheme. This is a huge sum, but so is the challenge.

Many more households will stay warm, fewer businesses will fail, and the economic slump this winter will feel slightly less grim. This will help to maintain resolve in the economic war against Vladimir Putin that the UK and its partners cannot afford to lose.

A two-year price cap for households is, nonetheless, a blunt instrument to tackle a multi-faceted crisis. The UK will be paying the cost for decades. As it subsidises costs regardless of income level, it provides a big giveaway to the better-off, while some of the most vulnerable will still struggle with prices at this level. The cap also lessens incentives to reduce consumption, though the price will still be significantly higher than prewar levels.

Precise details will need to be ironed out quickly. Many businesses will also be anxious about how they will cover costs after the government’s six-month price guarantee passes. Truss’s team may need to develop their package as the crisis evolves. Yet with many households and enterprises just weeks away from financial ruin, the government had to opt for speed.

The cap should pull down near-term inflation, reducing immediate debt interest costs, while also potentially easing inflation expectations. But the additional boost to demand may mean inflation proves stickier. And if wholesale prices go even higher, the government’s outlay to maintain the price freeze will increase.

After giving ground on “handouts”, Truss is determined to maintain her campaign pledge to reverse this year’s increase in national insurance and freeze corporation tax at current rates. If she goes ahead, however, borrowing will soar further, and there is little room elsewhere for cutting spending.

Revenue will have to be raised from somewhere. Sterling has crashed to its lowest since 1985 and gilt yields have pushed higher. Investors are jittery over the hefty borrowing and the risks that debt, already at 96 per cent of gross domestic product, could become unsustainable. The Bank of England will have to reassure markets that it remains committed to fighting high inflation despite the government’s intervention. A planned fiscal statement this month also needs to provide precise details on the funding plans, and an independent assessment by the Office for Budget Responsibility.

Attempting to boost energy security — in part by short-term steps to exploit more UK fossil fuels — and to reform pricing to better reflect the country’s energy mix are reasonable goals. But they must not detract from vital efforts to reduce long-term reliance on oil and gas and accelerate the transition to renewable and nuclear energy. In the near-term, gas supplies may become even more scarce, while the price cap might not restrain demand. That makes it vital for the government to push ahead with an information campaign for households and businesses to save energy and raise efficiency.

Today’s package is a crucial step in the battle against Putin’s weaponisation of gas. It will certainly not be the last. But the government must balance the urgency to protect consumers and win the economic war with the Kremlin with the need to preserve Britain’s invaluable reputation for economic prudence.

Is that from the financial Times?

Or the Conservative party ?

Or you ?

Your continual creeping up the asses of the Tories is vomit inducing

[SLUDGE FACTORY]

True, I know that, but it was better than not doing anything and ignoring the situation ( which appeared to be happening )

By the conservatives , yes

They were doing f all

[SLUDGE FACTORY]

You shouldn't be so smug. All Truss did was to delay YOU having to foot the bill (through increased taxes) in the future.

The tory idiots havnt done anything for ages , now they have .....but its half arsed

The tory boys on here are clapping like seals

[blue matt]

By the conservatives , yes

They were doing f all

But in the end they did do something, just in the nick of time

[Dorcus]

But in the end they did do something, just in the nick of time

If they hadn't the whole economy would have likely collapsed about them. It's a bit like paying for a gas leak to be fixed before it blew half a street of houses down. They had no choice in the matter.

[lisvaneblue]

Through borrowing.

And if we can claw some back by further taxing any excess profits then do it.

Not forgetting the banks who will also profit (by doing bugger all) from government largesse.

I don't think you have much idea of how business works, or for that matter, where government gets most of its money from...I'll give you a clue..its not from income tax.

While youre at it about banks and energy companies why not have a go about the pharmaceutical industry and the profits its made from Covid vaccines?

[the other bob wilson]

True, I know that, but it was better than not doing anything and ignoring the situation ( which appeared to be happening )

For months there has been a section of society really struggling to cope with the current situation regarding energy prices. From the beginning of next month, many of these people will have to find more than five hundred pounds a year more to pay for their energy before it reaches the level where the freezing of annual charges at £2.500 comes into force.

You have the means to pay £2,500 a year for your energy I presume as do I know because I qualified for the state pension in February, but, if all of this had been happening in 2021, I would not have been able to cope financially.

The proposals unveiled yesterday help, of course they do, but, for me, when faced with the choice between aiding people and money (business), the Tories, as they always do, have, effectively, sided with the money, What we've got is help today, which will have to be paid for by us, not the people who are really benefiting financially from the current situation, tomorrow - of course, it's better than nothing, but I think it's out of step with the current mood of the country.

[goats]

But in the end they did do something, just in the nick of time

Still amazes me that anyone can tell any difference which political party is running the country, I’m 50, seen a few and just the same old sh*t with a different colour label. You pay tax, bills and your mortgage and earn a crust…….we live in a country of moaners so I guess there will always be something to fuss over.

[goats]

For months there has been a section of society really struggling to cope with the current situation regarding energy prices. From the beginning of next month, many of these people will have to find more than five hundred pounds a year more to pay for their energy before it reaches the level where the freezing of annual charges at £2.500 comes into force.

You have the means to pay £2,500 a year for your energy I presume as do I know because I qualified for the state pension in February, but, if all of this had been happening in 2021, I would not have been able to cope financially.

The proposals unveiled yesterday help, of course they do, but, for me, when faced with the choice between aiding people and money (business), the Tories, as they always do, have, effectively, sided with the money, What we've got is help today, which will have to be paid for by us, not the people who are really benefiting financially from the current situation, tomorrow - of course, it's better than nothing, but I think it's out of step with the current mood of the country.

Don’t they get 400 or 800 quid free towards that also? Or has that gone now?

[William Treseder’s Mam]

But in the end they did do something, just in the nick of time

Yeah just waited for everyone’s bills to increase massively first. Phew just in time

[JamesWales]

Don’t they get 400 or 800 quid free towards that also? Or has that gone now?

Everyone will get £400 off bills for 6 months..ie £66 off their bills. I live in a two bed flat and I'll almost certainly be paying less for fuel this winter than any point in my life.

People on the following benefits will also receive £650 in two one-off sums, the first of which came a month or so ago. The next in October. People can spend that how they like.
Universal Credit
income-based Jobseeker’s Allowance (JSA)
income-related Employment and Support Allowance (ESA)
Income Support
Pension Credit
Child Tax Credit
Working Tax Credit

[lisvaneblue]

For months there has been a section of society really struggling to cope with the current situation regarding energy prices. From the beginning of next month, many of these people will have to find more than five hundred pounds a year more to pay for their energy before it reaches the level where the freezing of annual charges at £2.500 comes into force.

You have the means to pay £2,500 a year for your energy I presume as do I know because I qualified for the state pension in February, but, if all of this had been happening in 2021, I would not have been able to cope financially.

The proposals unveiled yesterday help, of course they do, but, for me, when faced with the choice between aiding people and money (business), the Tories, as they always do, have, effectively, sided with the money, What we've got is help today, which will have to be paid for by us, not the people who are really benefiting financially from the current situation, tomorrow - of course, it's better than nothing, but I think it's out of step with the current mood of the country.

My understanding is that will not be a freezing of annual charge. The unit price of energy will be set so that the average household will pay no more than £2,500.

And who are the 'we' that will have to pay for it, and who are the people really benefiting financially?

As Ive said earlier income tax generates less than 25% of government income, and around half of all adults do not pay any.

[Rontomuk]

Apologies, it is £650, not £750. Which is on top of the £66 off bills a month.

It states here that anyone on the following will receive it:

Universal Credit
income-based Jobseeker’s Allowance (JSA)
income-related Employment and Support Allowance (ESA)
Income Support
Pension Credit
Child Tax Credit
Working Tax Credit

Poorer households absolutely ARE getting more support than wealthier. It's completely untrue to claim otherwise.

You keep on about how people on deferent benefits are better off, but how about pensioners, and low paid workers whose income falls just outside the threshold to claim those benefits.

in my own case my income falls £1 27p above the threshold so I am unable to claim pension credit.

my utility bill was £75 a month, this has gone up to £182 a month, can you please explain how I can pay this, because I don't qualify for the free gas and electric you claim you will be getting this year.

[poc]

You keep on about how people on deferent benefits are better off, but how about pensioners, and low paid workers whose income falls just outside the threshold to claim those benefits.

in my own case my income falls £1 27p above the threshold so I am unable to claim pension credit.

my utility bill was £75 a month, this has gone up to £182 a month, can you please explain how I can pay this, because I don't qualify for the free gas and electric you claim you will be getting this year.

if that is your monthly direct debit figures ask to go on a monthly variable and pay for what you use they cannot refuse if you ask it might work out cheaper than the 182 you never know

[JamesWales]

You keep on about how people on deferent benefits are better off, but how about pensioners, and low paid workers whose income falls just outside the threshold to claim those benefits.

in my own case my income falls £1 27p above the threshold so I am unable to claim pension credit.

my utility bill was £75 a month, this has gone up to £182 a month, can you please explain how I can pay this, because I don't qualify for the free gas and electric you claim you will be getting this year.

It goes without saying that sometimes those who fall just outside the threshold for benefits are often in difficult positions and it won't be an easy winter.

In my position; I pay £65 a month to Shell for Gas and Electric. I routinely use around half of that, so there is a surplus. I anticipate it going up from October (not sure how much yet) but £66 will be knocked off that.

I would imagine your £182 doesn't include the £66 to be taken off, although I don't know.

None of this is perfect. We live in a time when the cost of fuel is extremely high due overwhelmingly to a war in Europe. But the announcement does mitigate against the worst excesses of what we would have faced and those on benefits are helped more.

[Eric Cartman]

It goes without saying that sometimes those who fall just outside the threshold for benefits are often in difficult positions and it won't be an easy winter.

In my position; I pay £65 a month to Shell for Gas and Electric. I routinely use around half of that, so there is a surplus. I anticipate it going up from October (not sure how much yet) but £66 will be knocked off that.

I would imagine your £182 doesn't include the £66 to be taken off, although I don't know.

None of this is perfect. We live in a time when the cost of fuel is extremely high due overwhelmingly to a war in Europe. But the announcement does mitigate against the worst excesses of what we would have faced and those on benefits are helped more.

So oil/gas companies are going to exceed usual profits by 170 billion over the next two years because we are at war. Shell and BP are going to take their part of that 170 billion and invest a fraction into the UK (potentially in things that don't align with the future energy security needs of the average punter) and pocket the rest.

Ordinary people - lose
Uk economy - lose
Oil/gas giants - win

We aren't debating whether or not people should be supported, we are debating why, yet again, during hard times (times of war even) the system is designed to make sure the rich keep getting richer.

I don't think there is any tangible evidence that having a windfall tax to pay for some of this support will affect future growth. Whilst not having one certainly will mean is a tightening of the belt in the future, worse education, worse healthcare, less police. For the first time in my life it really feels like the UK is a dead man walking.

I saw a picture on Reddit the other day of a car park tariff. £13 for one hour, £25 for two, etc. With the header something like 'you know there is something wrong when a parking space earns more than a person'. Something to ponder.

[goats]

So oil/gas companies are going to exceed usual profits by 170 billion over the next two years because we are at war. Shell and BP are going to take their part of that 170 billion and invest a fraction into the UK (potentially in things that don't align with the future energy security needs of the average punter) and pocket the rest.

Ordinary people - lose
Uk economy - lose
Oil/gas giants - win

We aren't debating whether or not people should be supported, we are debating why, yet again, during hard times (times of war even) the system is designed to make sure the rich keep getting richer.

I don't think there is any tangible evidence that having a windfall tax to pay for some of this support will affect future growth. Whilst not having one certainly will mean is a tightening of the belt in the future, worse education, worse healthcare, less police. For the first time in my life it really feels like the UK is a dead man walking.

I saw a picture on Reddit the other day of a car park tariff. £13 for one hour, £25 for two, etc. With the header something like 'you know there is something wrong when a parking space earns more than a person'. Something to ponder.

I know the UK government don’t want to pi$$ off the big foreign companies ie the oil companies ( anyone know who exactly owns them would be good to know?) but I think a compromise is needed as the profits are obscene and if it’s the Russians and Putin pocketing these profits then the world has gone mad.
I was paying £184 a month anyway due to my wife always being f in freezing so I guess I can crank it on up and not give a toss now…..

[Vindec]

The Labour Party has come up with a brilliant wheeze which many people believe. Let's use a windfall tax to pay for the energy increases and tax these nasty companies they say. That will go down well with the population.

The reality is that a second windfall tax (over and above the 65% they already pay) won't go anywhere near paying for the energy crisis but who cares if that brilliant idea will get one over on the Tories. They must think we are dumb but clearly the population must be if they really believe a second windfall tax is the answer to their problems. The amounts of money required are eye watering and it is only economic growth that will get us out of this mess. The public won't end up paying that much (only 30.3% of income tax is accounted for in government revenue) which is the belief of many. If the economy stagnates we are stuffed.

[Claude Blue]

The Labour Party has come up with a brilliant wheeze which many people believe. Let's use a windfall tax to pay for the energy increases and tax these nasty companies they say. That will go down well with the population.

The reality is that a second windfall tax (over and above the 65% they already pay) won't go anywhere near paying for the energy crisis but who cares if that brilliant idea will get one over on the Tories. They must think we are dumb but clearly the population must be if they really believe a second windfall tax is the answer to their problems. The amounts of money required are eye watering and it is only economic growth that will get us out of this mess. The public won't end up paying that much (only 30.3% of income tax is accounted for in government revenue) which is the belief of many. If the economy stagnates we are stuffed.

The "brilliant wheeze" is gullible people like you thinking these companies pay a tax rate of 65%.

Oil and gas companies pay 30% corporation tax and a supplementary rate of 10% They can reduce this by factoring in losses and decommissioning North Sea oil platforms. As a consequence, companies like BP and Shell have paid virtually no tax in the UK. They have very clever accountants and the fact that our current prime minister used to be one is purely coincidental

In fact both companies have actually received more money back from the goverment than tax paid every year since 2015.

In the three months to June this year Shell made a profit of £9bn and BP £6.9bn.

Explain again why we shouldn't have a windfall tax?

Can you explain the recent comments from the CEO of BP (I think) who stated that his company was like a cash machine and had more money than they knew what to do with?

[Vindec]

Explain again why we shouldn't have a windfall tax?

Where did I say we shouldn't have a windfall tax? What I was saying is that a second windfall tax would not go anywhere near paying for the energy crisis and the Labour Party has been very clever in convincing people that one would be of such significance.

You are correct that Shell and BP have very clever accountants and for the reason you explain these accountants would be able to dodge a second windfall tax in the same way they will be likely to avoid the first. I agree that the 65% tax rate is largely irrelevant and that few will pay much of it. So, why do you think a second tax is likely to be any better.

[xsnaggle]

The £66 a month is a loan no? You’ll be paying it back at some point.
And below the market cap is still double what it was a year ago.

No its not, it's a grant.

[Claude Blue]

Where did I say we shouldn't have a windfall tax? What I was saying is that a second windfall tax would not go anywhere near paying for the energy crisis and the Labour Party has been very clever in convincing people that one would be of such significance.

You are correct that Shell and BP have very clever accountants and for the reason you explain these accountants would be able to dodge a second windfall tax in the same way they will be likely to avoid the first. I agree that the 65% tax rate is largely irrelevant and that few will pay much of it. So, why do you think a second tax is likely to be any better.

I'm pleased that you now think there should be a windfall tax and that your 65% figure was bollocks.

The way around clever accountants is for the government to enact effective, watertight policy. Having a PM who was previously an economist for shell should help. Poacher turned gamekeeper if you like.