Opposition proposals to freeze the price cap - fair for people who have fixed?

savers_united

GingerTim said:

The two candidates for PM are being awfully quiet in response to Labour's proposal and allowing it a free run in the media - it's almost as if they know they are going to have to row back on their campaign pledges the moment they get in, and do something similar...

Now the lid is off it is going to be difficult for either candidate to get this proposal (fully costed) by labour back in the box. Whatever happens more support will be needed. 

pochase

Section62 said:

GingerTim said:

The two candidates for PM are being awfully quiet in response to Labour's proposal and allowing it a free run in the media - it's almost as if they know they are going to have to row back on their campaign pledges the moment they get in, and do something similar...

Or that they know sooner or later people will understand the proposal's funding isn't just from a windfall tax on 'fat cat' energy companies, but also on scrapping the £400 each household is expecting to start receiving from October.  A 100% 'windfall tax' on every household's £400 energy bill rebate is not going to be as popular as taxing other people tends to be.

Or the candidates are letting the economists do their work for them -

"But economists warn it's delaying borrowing costs rather than saving them - they say that stopping the subsidy would push up inflation and borrowing costs."

https://www.bbc.co.uk/news/business-62542541

You cannot use the money twice, give them to the people and use the money to freeze the cap.

Why should anybody get any of the help for the £2800 cap level, if the cap is frozen at April level?

The £650 cost of living might be different, it is not just for energy, but still energy was one of the main reasons.

Section62

savers_united said:

GingerTim said:

The two candidates for PM are being awfully quiet in response to Labour's proposal and allowing it a free run in the media - it's almost as if they know they are going to have to row back on their campaign pledges the moment they get in, and do something similar...

Now the lid is off it is going to be difficult for either candidate to get this proposal (fully costed) by labour back in the box. Whatever happens more support will be needed. 

Is it fully funded though?

No.  Despite the headlines suggesting it will be funded by a windfall tax, £7Bn of the cost is supposed to be funded by the proceeds of reduced government debt interest payments based on the assumption that limiting energy bill increases will reduce inflation.

Ultrasonic

Section62 said:

Is it fully funded though?

Exactly. Plus even if it panned out exactly as Labour suggest (questionable) it is only a 'plan' for 6 months. Then what? 

We need a long term plan to cut energy use and offer targeted support to those who genuinely need it. Plans that just continue to rack up government (taxpayer) debt aren't a magic bullet.

jimexbox

Ultrasonic said:

Section62 said:

Is it fully funded though?

Exactly. Plus even if it panned out exactly as Labour suggest (questionable) it is only a 'plan' for 6 months. Then what? 

We need a long term plan to cut energy use and offer targeted support to those who genuinely need it. Plans that just continue to rack up government (taxpayer) debt aren't a magic bullet.

I can see exactly what would happen after 6 months. Huge pressure to have an endless fixed cap.

2.3 trillion in debt and Labour want a cap no matter how much you earn. Funded by those who aren't even born yet. As they will be paying this off, along with the 400 billion splurged on covid.

savers_united

The problem with freezing the cap or any other intervention its a sticking plaster, £28bn is a lot of money that could be used towards longer term energy reduction.

Some quick calcs, £28bn could give over 2.5mil households up to £10k towards efficiency measures, insulated warm flat roofs, New windows / doors, EWI, roof insulation, cavity wall insulation etc etc.

Anyone of these measured installed correctly and at the right price will give long term benefits rather than just holding back prices for 6 months.

Any households with total income less than £100k should have access to these funds where they must price match the work, i..e EWI = £20k, Govt give £10k / homeowner gives £10k.

I know similar schemes have been tried before, but if its done right It could make a big difference to the housing stock in this country for work that is often cost prohibitive for homeowners without any grant support. 

For those on lowest incomes / deprived areas I believe schemes are already in place, in those cases the targeted support with bills can be the other option.

If I was given a choice between saving maybe £1500 over the next 12mths on my energy bills or the chance to get upgraded windows / insulation that will help reduce my energy use for the next decade then its a no brainer. 

jak22

If people genuinely want a scheme that helps everyone and are not just supporting it because it comes from the opposition then it does needs to help everyone.

The extra cost to allow for fixers should be small compared with how much it'll cost to freeze the cap for everyone else - unless of course there are actually a lot more fixers than people assume.

People who fixed this year at above April cap werent gambling - they tookthe  time to understand how the cap works - and not everyone seems to - and could see how prices were rising - even before some websites shifted opinion from sticking with SVT, 

[Deleted User]

A ‘plan’ is gaining momentum:

https://www.theguardian.com/business/2022/aug/15/centrica-and-octopus-back-plan-to-freeze-uk-energy-bills-for-two-years

Think of it as taking out a long-term mortgage to pay off our high energy bills over the short term.

sienew

savers_united said:

GingerTim said:

The two candidates for PM are being awfully quiet in response to Labour's proposal and allowing it a free run in the media - it's almost as if they know they are going to have to row back on their campaign pledges the moment they get in, and do something similar...

Now the lid is off it is going to be difficult for either candidate to get this proposal (fully costed) by labour back in the box. Whatever happens more support will be needed. 

Not fully funded at all though, is it?

It's an exceptionally wasteful use of £28,000,000,000.00

There are ways of spending that amount of money that would be far more effective and long term, especially as realistically most will actually be funded by govt borrowing. Targeted support would be most useful for those who are most in need. Spending the money on energy efficiency would be better for most other people. Investing the rest in producing more energy in this country would be the best long term solution of all so we are never in this situation again. And those who can really need to cut down on wasteful usage and this proposal doesn't help with that at all.

bristolleedsfan

[Deleted User] said:

The ‘plan’ is gaining momentum:

https://www.theguardian.com/business/2022/aug/15/centrica-and-octopus-back-plan-to-freeze-uk-energy-bills-for-two-years

Think of it as taking out a long-term mortgage to pay off our high energy bills over the short term.

Trying to minimise additional customer bad debts ....