MSE News: British Gas warns of energy price rises

MillicentBystander

Terrylw1 wrote: »

But would that reduce the wholesale cost? No.
Would it make the companies more efficient? Not necessarily. Councils are big money wasters and dont forget the bloke carrying the post on civil servant pay would be on a ridiculous level of pay compared to the private sector.

If the problem is truly greed, there is a regulator and what would they do to prevent public sector costs rising?

Don't forget a nationalised service doesn't answer to the customer and you get nowhere with complaints and you can't vote with your feet, only every 4 years to new government who will make promises and not deliver them.

The public sector is notorious for money wasting so its not a matter of going back to the good old days. Costs are costs, they've gone up and keep going.

What we need is someone to regulate the process of buying and selling. We also need someone to set efficiency targets to stop the companies venting millions of pounds in waste...like the American & Japanese production companies have over the last 30 years!

Talking of costs, here's what you wouldn't need under nationalisation:

1. 5 Customer Service Depts
2. 6 Sales Depts
3. 5 hugely expensive IT systems
4. 6 hugely expensive CEOs
5. 6 boards of directors
6. A massively bloated (and hugely overpaid) regulator


Any more?

ChiefGrasscutter

Well with nationalisation/public ownership we got

No investment in gas infrastructure - many rural areas in UK don't have gas as they were never connected up and have to rely on very expensive oil or LPG. So much for the concept of universal access under public ownership then.

No investment in Telephone infrastructure - which is why BT lines are now continually failing and giving poor broadband performance.

No investment in the water/drainage infrastructure which is why we have shortages/restrictions/leaks and why the sewage systems of London date from the Victorian age.

Instead of being reinvested in the business infrastructure the "profits/surpluses" made under public ownership simply went into the government general funds where they could be wasted on any number of public projects.
Of course no one cared at the time as the point when the infrastructure would start to collapse (now) would be far off into the future and would be someone else's problem. (their children's mostly)


Re gas/oil longer term with Japan, Germany et al shutting down their nuclear power stations and therefore having to switch to oil/gas for generation there will be more global competition for gas/oil (including from China) so the price will go up and will continue to do so.
Unless I suppose the economy collapses into a Greek style depression where the price will fall as no one is using it.

....oh and forgot to mention the output from the N.Sea is declining at something like 20% per annum: so we will be importing it all from somewhere and all the easy to reach gas/oil has been found and extracted.
Welcome to the new world order

undaunted

Actually it's been previously argued - including on here - that the reason we wouldnt get the benefit of falling wholesale prices was that they did buy months in advance.

Now that it's rising this seems to have been conveniently forgotten

Remember what was said in January? https://forums.moneysavingexpert.com/discussion/3721877

Ofgems previous criticisms have included

[URL="http://www.dailymail.co.uk/news/article-2102458/Ofgem-tells-Big-Six-energy-firms-reduces-prices-face-cap-fuel-bills.html https://forums.moneysavingexpert.com/discussion/3721877 [/URL]

BobQ

Terrylw1 wrote: »

But would that reduce the wholesale cost? No.
Would it make the companies more efficient? Not necessarily. Councils are big money wasters and dont forget the bloke carrying the post on civil servant pay would be on a ridiculous level of pay compared to the private sector.

If the problem is truly greed, there is a regulator and what would they do to prevent public sector costs rising?

Don't forget a nationalised service doesn't answer to the customer and you get nowhere with complaints and you can't vote with your feet, only every 4 years to new government who will make promises and not deliver them.

The public sector is notorious for money wasting so its not a matter of going back to the good old days. Costs are costs, they've gone up and keep going.

What we need is someone to regulate the process of buying and selling. We also need someone to set efficiency targets to stop the companies venting millions of pounds in waste...like the American & Japanese production companies have over the last 30 years!

Apart from your anti-public sector views, there is no evidence it is any more efficient as a small group of private companies operating in a market where there is a dubious level of true competition and no incentives to eliminate inefficiencies.

As to your last paragraph, I presume you are suggesting the sort of regulation and efficiency targets that would need to be agreed/justified/set by the same kind of public sector people that your previous diatribe was about. The American and Japanese experience is presumably a further demonstration of the way private companies have exploited the consumer in the quest for profit.

BobQ

ChiefGrasscutter wrote: »

Well with nationalisation/public ownership we got

No investment in gas infrastructure - .......

True, but that was a fault of the interfering owner (ie the Government) not the natonalised model itself. Also we must remember that many of these facilities were only nationalised due to the inability of private sector to operate them profitably and efficiently in the first place.

Terrylw1

BobQ wrote: »

Apart from your anti-public sector views, there is no evidence it is any more efficient as a small group of private companies operating in a market where there is a dubious level of true competition and no incentives to eliminate inefficiencies.

As to your last paragraph, I presume you are suggesting the sort of regulation and efficiency targets that would need to be agreed/justified/set by the same kind of public sector people that your previous diatribe was about. The American and Japanese experience is presumably a further demonstration of the way private companies have exploited the consumer in the quest for profit.

Actually, no.

My view is based on entering the industry just as nationalisation ended.

These people set the industry up, not the private sector and even now there are very poor practises, a lack of understanding of the processes they were involved in creating and a long way to go to bridge they gap between what you pay and what they pay. This all existed from day one...created by the same people who ran it under nationalisation. So, how perfect was it? Why have so many millions been invested to improve and control the mess it was in from day one?

Er, no, the American & Japanese experience is based on improving products & services to eliminate waste and reduce costs to you instead of previous models that simply made services more expensive. These methods over the past 30 years and more have changed how big businesses operate all over the world. They work!

I'm not suggesting companies set their own efficiency targets at all, that's already happening and it doesn't work. I'm merely suggesting to MSEers who seem to accept wholesale cost is the only reason, that you don't see the level of waste inn the industry.,.oh yeah, set up by people from the nationalised era.

The view you often see on MSE, is the view of field staff. If you look at the office based side in the billing/information side, such as a supplier, efficiency is very different. Back in the good old days, the most junior of roles could stay there for X years and be on management level pay for doing very little. The processes to produce your bills was ancient and they did what ever they wanted, they didn't always care about investigation. Then we have all the paper trails that were inefficient remnants of a dead age...whilst you may see no published proof of improvement, doesn't mean the public sector is a shining light of perfection...or do you never have an issue with council style bureaucracy.

Terrylw1

MillicentBystander wrote: »

Talking of costs, here's what you wouldn't need under nationalisation:

1. 5 Customer Service Depts
2. 6 Sales Depts
3. 5 hugely expensive IT systems
4. 6 hugely expensive CEOs
5. 6 boards of directors
6. A massively bloated (and hugely overpaid) regulator


Any more?

Really?

So, councils, NHS, etc don't have expensive management and don't bring in expensive consultants?

IT systems, so you didn't know the utility companies were still using the systems they were during the last 30 years of nationalisation? Do you also believe that they would never upgrade to new technology? Do you think other public services continue with obsolete systems when they can upgrade to more efficient systems? So, you also don't believe the public sector doesn't upgrade its programming languages yo stick with times, especially since Microsoft force them to upgrade by pulling software support on older products.

Let's not forget all those civil servant pay grades all the staff were on. You know, these ones where the post boy gets the same salary as his manager would in the private sector.

The issue I had with nationalisation is the level of knowledge the office based people had. These are the people tat shaped the business and industry prior to deregulation and the minute it went through, accuracy , efficiency and just having a clue just seemed to end and everyone spends years playing catch up. The industry is largely a mess due to this.

Regulator wise, very true...but the government could do something about that if they really wanted to. Its a well known fact that the people employed at senior levels in regulatory bodies have a habit of hopping in and out if supplier/distributor positions.

schrodie

Compared to other European countries are we in the UK paying far more for our gas and electricity? For example EDF is a French company so do the French enjoy lower energy bills than EDF's UK customers? I know we pay more for our petrol/diesel here in the UK than in most other parts of Europe mainly because of the tax element but I just wondered how we compare to the rest of Europe with respect to household energy.

Andy_WSM

schrodie wrote: »

Compared to other European countries are we in the UK paying far more for our gas and electricity? For example EDF is a French company so do the French enjoy lower energy bills than EDF's UK customers? I know we pay more for our petrol/diesel here in the UK than in most other parts of Europe mainly because of the tax element but I just wondered how we compare to the rest of Europe with respect to household energy.

Our domestic gas is cheap, electricity middle of the road.

All the figures are here: http://www.energy.eu/ - makes for an interesting read.

Pincher

If we were invaded, we will need lots of underground bomb proof storage for all sorts of stuff.

Apparently, the tunneling machines for the Jubilee extension were parked under ground because it was cheaper than getting it out. Why don't we point it to further down river, and create some storage and bomb shelters.

If we build Boris' airport, we will need a train link.
If we do it underground, there will be minimal impact.
We can do it below the nature reserves.
With light channeling chimneys, you can even live down there.
Minimal heating when you live underground.
With the train link, it's a easy commute to Canary Wharf and Bank.

Easy access to an international airport, easy commute to the City, living in a nature reserve, it's a real estate gold mine.