Tuesday, November 30, 2010

Thatcher and Her Blue Children: How Privatisation ruined Britain

This article on privatisation and its consequences, by CPO co-founder Neil Clark, appears in the Morning Star.

It's exactly 20 years ago this month that Margaret Thatcher, the longest-serving British prime minister of the 20th century, left Downing Street.
Thatcher's negative impact can be seen in many areas. But arguably the most toxic legacy was her privatisation programme.

Thatcher broke with the policy of previous post-war Conservative governments which had accepted the mixed economy post-war consensus, instead embarking on a major series of sell-offs when she first came to power in 1979.

British Telecom, British Gas and British Airways were three of the biggest state-owned companies that Thatcher flogged off.

She also broke up the National Bus Company and Sealink - the highly-profitable publicly owned ferry company.

But the great tragedy was that privatisation did not end with Thatcher's eviction from Number 10 in November 1990.

John Major's government took privatisation even further than the Iron Lady dared to go - embarking on the disastrous sell-off of Britain's railways.

You can read the whole article here.

Privatised energy firms face gas and electricity price review

The BBC reports:

Ofgem is to investigate recent energy price rises, as it says they have significantly widened suppliers' profit margins.

The watchdog said that the net profit margin of £65 per typical customer in September was now £90, a 38% rise.

The calculations take into account price rises announced by three of the "big six" suppliers in recent weeks.

The regulator said it was asking if "companies are playing it straight with consumers" after the latest figures showed a 38% rise in profit margins from the typical dual-fuel customer in the last three months

Wednesday, November 24, 2010

Unhappy New Year: Rail fares set to rocket by as much as 13%

From Ray Massey in the Daily Mail:

Rail passengers face ‘astronomical’ fare rises of up to 13 per cent in January – with worse to come.

The increases have sparked a furious row over ‘rip-off’ ticket prices, with rail company bosses accused of hiding the truth while passengers suffer ‘cattle-class’ conditions of overcrowding.

Train firms – which receive billions in taxpayer subsidies – were attacked by unions for the ‘outrageous’ rises.

The umbrella Association of Train Operating Companies (ATOC) announced yesterday that fares will rise in January by ‘an average of 6.2 per cent’.

This includes the 5.8 per cent Government cap on regulated fares, which account for 46 per cent of the total.

But there was fury when ATOC chief executive Michael Roberts refused to reveal how much the 54 per cent of unregulated fares – which can rise as high as the train company likes – were increasing.

Monday, November 22, 2010

Neil Clark: Paying the cost of Britain's Greedy Firms

This article by CPO co-founder Neil Clark appears in the Sunday Express

DID you think Britain was an expensive enough country to live in?

If so, I’m afraid I’ve got some bad news for you. Over the next few weeks things are going to get a whole lot worse… Take energy prices. On December 1, Scottish and Southern Energy, Britain’s second biggest supplier, is raising gas prices by 9.4 per cent. Ten days later British Gas is putting up its gas and electricity rates by seven per cent.

Household bills will go even higher from January 1 as VAT rises to 20per cent. Just what we need to get the New Year off to a good start.

....Then there’s train fares. Britain’s railways are already the most expensive in Europe and fares will rise again by as much as 10.8 per cent on some commuter routes from January.

Far from being a helpless bystander, there’s much the Government could do to alleviate the situation.

Regarding the railways and the utilities, the best solution would be to bring them back into public ownership. With no shareholder dividends to be paid, prices could be reduced to the European average, bringing relief to long-suffering commuters.

In Belgium, where railways are still owned by the state, fares are up to 20 times cheaper than in Britain. At weekends, prices actually drop by 50 per cent, making it easier for friends and families to visit each other.

Railways are a natural monopoly and it is much better for consumers if they are in public ownership.

You can read the whole article here.

Friday, November 12, 2010

Privatised British Gas hikes gas and electricity prices by 7%

The Guardian reports:

British Gas today announced it is putting its prices up by 7% for both gas and electricity from 10 December, making it the second major energy supplier to raise its prices in recent weeks.

It is estimated the increase in standard and variable tariffs will affect around 8 million customers, with the price increases adding £53 to annual gas bills and £29 to electricity bills.

Adam Scorer, director of external affairs at Consumer Focus, said: "British Gas and other suppliers respond to forward energy prices, and that will be their argument that price rises are needed. However, wholesale prices are around half of their peak in 2008, and yet in the same period customer's prices were cut by less than 10%.
"Consumers will feel that suppliers didn't make cuts when conditions allowed it, but are covering their profit margins as wholesale prices nudge up. At a time when there are reports of a gas glut it seems that consumers take on all the risk in this market."

Friday, November 5, 2010

British government sells Channel Tunnel rail link to Canada

The Guardian reports:

The Channel tunnel rail link has become the latest piece of British infrastructure to be snapped up by acquisitive Canadian pension funds.
Two of Canada's largest pension funds have paid £2.1bn to operate Britain's only high-speed railway line for the next 30 years. It is the first privatisation deal done by the coalition government.

The RMT union slammed the rail link sell-off as "just another act of political vandalism on the UK railways". Bob Crow, the RMT general secretary, said: "The most modern section of the UK rail network has been sold off for a song in what amounts to nothing more than a fire sale of the family silver to prop up the financial deficit caused by the bankers and speculators in the first place.