Your browser isn't supported
It looks like you're using an old web browser. To get the most out of the site and to ensure guides display correctly, we suggest upgrading your browser now. Download the latest:

Welcome to the MSE Forums

We're home to a fantastic community of MoneySavers but anyone can post. Please exercise caution & report spam, illegal, offensive or libellous posts/messages: click "report" or email forumteam@.

Search
  • FIRST POST
    Former MSE Lawrence
    Would you re-nationalise the energy companies?' poll discussion
    • #1
    • 30th Nov 10, 12:01 PM
    Would you re-nationalise the energy companies?' poll discussion 30th Nov 10 at 12:01 PM
    Poll Started 30 November 2010:

    Would you re-nationalise the energy companies?

    In 1986 British Gas was privatised and floated on the stock market. Millions of 'Sid' shareholders got windfall profits at the time, in a massive deregulation of the gas and electricity market.

    Now 24 years on, with price rises hitting again, has privatisation worked? Some complain that prices have risen too high, but is that offset by market efficiencies?

    Which of these is closest to your view?

    A. Keep privatised – the free market's status quo is more efficient
    B. Regulate prices – keep it private but price rises should be controlled by the regulator (not firms)
    C. Re-nationalise – it should be taken back into public ownership


    Please vote here, or click 'post reply' to discuss below. Thanks

    This Forum Tip was included in MoneySavingExpert's weekly email

    Don't miss out on new deals, loopholes, and vouchers

    Last edited by Former MSE Lawrence; 30-11-2010 at 12:03 PM.
Page 2
  • roman city
    If we are fortunate enough to ever get a decent Government, they could take on the Power Company monopoly by setting up a Government backed energy company which would make minimum profit only to cover running costs.Gas and Electricity at a realistic price for everyone.
    • relaxtwotribes
    • By relaxtwotribes 2nd Dec 10, 8:00 PM
    • 268 Posts
    • 119 Thanks
    relaxtwotribes
    If we are fortunate enough to ever get a decent Government, they could take on the Power Company monopoly by setting up a Government backed energy company which would make minimum profit only to cover running costs.Gas and Electricity at a realistic price for everyone.
    Originally posted by roman city

    What a sad, sad take on how to run an effective economy. Not even Milliband's new, new, Labour would promote such a hopelessly outdated theory of how to run a country.

    The best Government we could hope for is one that promotes competition between the power companies now - goodness gracious, that's what we've got already!

    What you really want is your gas and electricity to be provided to you at cost - well, get real, without the profit element it ain't going to happen.
  • Gareth_Lazelle
    The best Government we could hope for is one that promotes competition between the power companies now - goodness gracious, that's what we've got already!

    What you really want is your gas and electricity to be provided to you at cost - well, get real, without the profit element it ain't going to happen.
    Originally posted by relaxtwotribes
    Eh?

    Most privatisation supporters delight in explaining how efficient companies are compared with the public sector (and how they bring the costs down - contrary to all evidence),

    Well guess what. If they can't compete with a public "company" providing competition then you've been selling us a load of crap.

    If you can compete, then what's the big deal with a little extra competition? You just said that competition was good for the market,

    <edit>Oh and BTW, your last sentence is contradictory - how can gas and electricity ever happen "at cost" if there is "profit" at all?

    Not saying that profit is a bad thing (though excess profit is indicative of a bad market), but it is at odds with "at cost"
    Last edited by Gareth_Lazelle; 03-12-2010 at 8:08 AM.
    - GL
    • relaxtwotribes
    • By relaxtwotribes 3rd Dec 10, 8:24 AM
    • 268 Posts
    • 119 Thanks
    relaxtwotribes
    Yes, Gareth, the last sentence is a bit contradictory. I suppose what I was trying to say is that the poster wanted his gas and electricity to be provided at the cost of production. The statement made about a monopoly power company is a nonsense when there are multiple generators and multiple suppliers now.

    My point is that the running costs of a government backed company are greater than the running costs and profit of a private enterprise.
    So, the poster would be paying a higher price for his energy needs.

    I do not mean to suggest that the power market cannot be improved upon. I simply hate the idea of state-controlled enterprises that cannot go bust - that usually means the workforce is incentivised to do as little work for the most reward and will strike to get its way.
    • Money Saving Dude
    • By Money Saving Dude 4th Dec 10, 1:06 AM
    • 126 Posts
    • 69 Thanks
    Money Saving Dude
    Hope yet...
    I can only assume that all those voting for renationalisation are under 40...
    Originally posted by webwiz
    Wey hey, so there is some sign of hope yet. The Thatcherite revolution has been a disaster. If it was bad before, it has been much worse since. [Democratic] Governments are supposed to be there to protect the people, not find interesting wheezes to increase the wealth of the few.

    So how much of the *guaranteed* income that these companies get is being ploughed back into new equipment? Or are we expecting the infrastructure put in place in the 50s and 60s to last forever?

    Wait! What's that? Buy some shares? ok -- sorted.
    • Money Saving Dude
    • By Money Saving Dude 4th Dec 10, 1:22 AM
    • 126 Posts
    • 69 Thanks
    Money Saving Dude
    I simply hate the idea of state-controlled enterprises that cannot go bust - that usually means the workforce is incentivised to do as little work for the most reward and will strike to get its way.
    Originally posted by relaxtwotribes
    So how does that relate to the Police, or Army, or Teachers? You are saying that only if you have the fear of losing your job will you put your back into anything. That's just plain nonsense. Good management will respond to those that refuse to pull their weight, but it should not -- must not -- be an argument that prevents the right sort of organisation being used in the right sort of environment.

    You cannot say that the free market model, with its fear element, is the only correct model for all sectors. Yes, in some environments it works very well. Competition stimulates innovation and encourages those that take risks to develop their sector. A good example is Mr Murdoch and Sky TV. He risked a lot, and is reaping the rewards.

    But you can't do that in, as an example, Education. People who teach or are related to the school are there for the children's needs. Yet because of political interference we seem to have to get 'those Socialists' away from our children. So we do this by removing a layer of democracy (remember the GLC, GMC, etc -- that was just evil); and then, because local authorities are hot beds of left wing agitation, we have to stick our political sticky fingers into that "to prevent waste."

    That is the trouble with this country -- the mantra "private is good and public is bad" is just too silly; any anyone that spouts that has no right to be heard in my opinion.
    • relaxtwotribes
    • By relaxtwotribes 4th Dec 10, 5:25 PM
    • 268 Posts
    • 119 Thanks
    relaxtwotribes
    Since when were the Police, Army and Teachers 'enterprises'?

    And I think what you meant to say was '... the mantra all private is good and all public is bad...' I would agree that is not correct.

    If you wish to see how much privatised enterprises spend on new equipment, have a look at their accounts. BT spent 1,861 million in its last financial year. Is that enough for you?
    • relaxtwotribes
    • By relaxtwotribes 4th Dec 10, 5:29 PM
    • 268 Posts
    • 119 Thanks
    relaxtwotribes
    Gareth,
    The Daylight Saving Bill received its second reading in the House, yesterday.
    • lowbrim
    • By lowbrim 4th Dec 10, 8:48 PM
    • 462 Posts
    • 291 Thanks
    lowbrim
    I am against nationalisation I worked in both regimes and the companies are now far more efficient and better run. What I am against is the way the industry has been structured with the trading arrangements.

    This has/is allowing the companies to structure themselves so that they can skim off enormous profits through there trading companies. Paying bonuses equal to those in the banking sector whilst showing minimal profits in the regulated business.

    I have worked in the business so I know first hand and done very well out of it, but it is wrong and unfair. Unfortunatly we have a regulator (OFGEM) that has no teeth in the unregulated market and do not have people with the intelligence to challenge the companies in the regulated markets. They have reviews that are just held as a timewaster for politicians until the public outrage dies down.

    The long and short of it is that governments on all sides are not actually interested in fairness as the companies do that much lobbying through there lobbyists throwing in that many red-herrings that government advisors do not actually understand the way the companies operate and the companies have no intent on telling them.

    Put simply the trading departments buy the fuel or electricity on the wholesale markets and then sell it on to the regulated business (who have no option but trade internally) at an inflated price and the difference between this inflated price and what the companies sell it to Joe public at is the margin they tell the regulator they make. Which is true if you just look at that part of the business!! With the Trading parts of the business making m's and traders get bonuses and salaries that are equal to those earned in the Banking sector! This is capitalism at its worst and I am a capitalist but I still believe in fairness and currently it is not. All of this being unregulated.
    Last edited by lowbrim; 04-12-2010 at 8:52 PM.
  • Hyme
    Missing option
    Nationalisation will not work, publically run organisations are never efficiently run even China and Russia have abandoned that approach. We already have a public sector that has been allowed to grow like a parasitic cancer to whopping 52% of the British economy.... (Well Done Blair & Brown the Laurel and Hardy of politics) The last thing we need is more government.

    The problem is that like all areas of our economy these companies have been allowed to become too big and too few. Can no one see this is the reason that 90% of the countries wealth now resides in the hands of top 10% of the population.

    Healthy competition is stifled in the hands of these huge corporate entities as they continue to rip us off with impunity.

    The missing option is to break these companies up into smaller companies to bring back price competition. The big six (cartel) business model the Labour party presided over only works in the interest of the boardroom and shareholders.

    We pay way over the odds for everything in this country and on top of that we pay way too much tax to pay the salaries of a morbidly obese public sector (and I'm not talking about the frontline public sector workers who do important and crucial job)

    The fact is frontline workers only account for 25% of the public sector, it's the other 75% who need cutting immediately as they are sucking the life blood out of this country, along with the over-powerful corporations who now effectively dictate the market buying and selling price of things. Surely this 'Entrepreneurial spirit' killing environment cannot be sustainable especially with 43 trillion of national debt.
  • proudmumof2
    The poll is missing one option:

    D. Governments should stop forcing energy companies to pay for efforts to combat 'global warming' and develop
    alternative forms of energy. These initiatives are expensive and make up a certain percentage of our energy bills as
    they are conveniently passed to the consumer.

    We stupidly boycott clean coal which is cheaper and more efficient while spending vast sums on carbon capturing devices, inefficient wind energy that includes the wind farms off the coast of Kent, and the recently scrapped wave technology, and other rediculously expensive sums to 'save the planet'. It's costing us a
    fortune to reduce CO2 while China, the USA and Russia, who emit far more into the atmosphere than tiny UK, think we are absolutely nuts.
    Originally posted by teddyco
    You are missing out the fact that they(coal) are unsustainable resources- we have to think of long-term alternatives (of which new nuclear builts should NOT be considered - until they first find a way of dealing with the piles of nuclear waste from the first generation of nuclear builds) Just because developing countries are going full dteam ahead depleting resources(while poluting the world) it doesn't just follow that we should copy them - what if we blindly copy the rest of their policies (which are policies only interested in achieving economic growth which again as above that kind of growth is no longer sustainable at such a level) then should we blindly follow their policies on unregulated labour, no holidays, no healthcare at point of need - oh and no platform to air your views or explore others because they don't allow internet. Its easy to not appreciate the advances that England has achieved (at a high cost historically but hey; you can't change the past).

    It makes me really happy that people are thinking that re-nationalisation is the best way. I also think that the initial privatisation process in the 80's - in England and throughout the world - should be seen as illegal. I think it's a shameful crime to put the health and well-being - and sometimes lives and deaths - of citizens at such risk; all based on an unproven philosophical belief in the ability of the markets to provide the best and fairest service. It is ridiculously irresponsible to experiment with LIVES in this manner and has claimed many lives Freidman, Thatcher and Reagan should be facing some kind of La Hague tribunal for the poverty, deaths, and divisiveness that this, and other privatisation policies, have inflicted on this world over the last 25 years.
    • dell12
    • By dell12 5th Dec 10, 12:25 PM
    • 118 Posts
    • 102 Thanks
    dell12
    Interestingly we now pay more in subsidy to train operators to run the railways than we did to run British Rail in real terms.

    For me a nationalised energy company would provide not only lower prices (just look at the difference between wholesale and consumer prices) but also energy security and some proper investment in the infrastructure of the country.
    • relaxtwotribes
    • By relaxtwotribes 5th Dec 10, 1:07 PM
    • 268 Posts
    • 119 Thanks
    relaxtwotribes
    National Grid spent 1 billion in the last year on capital expenditure.

    Just what criteria would a nationalised energy company use to decide what 'proper infrastructure' should be constructed? And who would decide - politicians, civil servants?

    Energy security? Don't make me laugh. Remember those CEGB (RIP) workers on strike, miners on strike, gas workers on strike. Doesn't sound like security to me, but making yourself a hostage.
  • mjh421
    Just think what the government could do with the profits these companies extort from an artificial market. I am personally sick of conmen and women calling on my phone or knocking on my door to sell me so called cheap gas and electricity, these people should find a real job and save us money to boot. Margret Thatcher promised these companies would provide better service and cheaper in both cases it has been a disaster. That goes for all her privatisations, Just look at the lottery you have to go through buying a rail ticket let alone getting a seat.
  • WhiteHorse
    Utilities like power, water and railways are vital national interests. They are far too important to be allowed to fall under foreign control or into the hands of greedy domestic speculators.

    All should be renationalised. Nationalisation doesn't have to mean (as it did for so long), massive waste and incompetence.
    "Never underestimate the mindless force of a government bureaucracy
    seeking to expand its power, dominion and budget"

    Jay Stanley, American Civil Liberties Union.
  • WhiteHorse
    Margret Thatcher promised these companies would provide better service and cheaper in both cases it has been a disaster.
    Originally posted by mjh421
    A disaster for the nation, certainly. Not a disaster for the vested interests behind it. Thatcher knew what she was doing, and was doing what she was told.
    "Never underestimate the mindless force of a government bureaucracy
    seeking to expand its power, dominion and budget"

    Jay Stanley, American Civil Liberties Union.
  • elbeie
    Rather like the debate about Cadbury's being taken over last year, this is a silly point to make. It matters not one jot whether these companies are UK owned. What matters is whether the money received from the foreign purchasers is employed to better purpose than previously. For example, take a company making 100m pa profit that is sold for 1,000m to a foreign buyer and that 1,000m is invested to make a return of 150m pa then the UK is better off by 50m pa.

    I know some posters will reply to the effect 'what about all the lost jobs?' but that too is to be sought after (with the caveat that it is government's responsibility to create an economy that creates new jobs). Ditching defunct jobs (coalmining, steelmaking, shipbuilding) and replacing them with higher value added jobs helps to fund a better NHS etc.
    Originally posted by relaxtwotribes
    Try telling that to the many skilled and experienced and workers who are now forced to work in supermarkets and call centres rather than use their skills and experience to benefit the UK economy. Are these the higher value added jobs referred to? 'Defunct jobs' is a smokescreen used by those who refuse to defend British industry and manufacturing whilst other countries steal an edge off us.

    Government needs to be about serving the people of this country. Representing and enacting the electorate's will rather than using smokescreens and illusions to act to the contrary. What a shame it's not, because judging by the poll so far, nationalisation is what people want despite many years of being offered idealogical smokescreens.
    Last edited by elbeie; 07-12-2010 at 2:41 PM.
    • plumber2009
    • By plumber2009 7th Dec 10, 3:32 AM
    • 308 Posts
    • 305 Thanks
    plumber2009
    Renationalise and use the profits to reduce defecit and fund the public purse.
    Renationalise Energy/Rail and BT.

    All profits would help fund public services in the longer term and create jobs rather than shareholders screwing british citizens in order to line their own pockets while the poor and eldery suffer.

    This country needs to stop selling its assets for a short gains. Buy it all back now as it will pay for itself in no time.
    Last edited by plumber2009; 07-12-2010 at 3:37 AM.
    • Eco Miser
    • By Eco Miser 8th Dec 10, 12:56 AM
    • 3,525 Posts
    • 3,297 Thanks
    Eco Miser
    My point is that the running costs of a government backed company are greater than the running costs and profit of a private enterprise.
    Originally posted by relaxtwotribes
    Why? What intrinsic mechanism automatically makes a government organisation more expensive than a private enterprise, such as a bank?
    Eco Miser
    Saving money for well over half a century
    • Eco Miser
    • By Eco Miser 8th Dec 10, 1:03 AM
    • 3,525 Posts
    • 3,297 Thanks
    Eco Miser
    Rather like the debate about Cadbury's being taken over last year, this is a silly point to make. It matters not one jot whether these companies are UK owned.
    Originally posted by relaxtwotribes
    Yes it does, not directly, but because the dividends go out the country. This is the mechanism by which in the 19th century Britain became rich, while India and Africa, despite having the raw materials which drove he industrial Revolution, remained poor. Now it's happening the other way.
    Eco Miser
    Saving money for well over half a century
Welcome to our new Forum!

Our aim is to save you money quickly and easily. We hope you like it!

Forum Team Contact us

Live Stats

486Posts Today

6,506Users online

Martin's Twitter