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Editorial: A government in retreat – and it’s people power that forces the pace

HE had no choice. Chancellor Rishi Sunak has been forced, against ideology and instincts, to target today’s runaway energy costs with a combination of universal and targeted subsidies for consumers and a windfall tax on energy monopoly profits.

These subsidies are both necessary and illustrate the idiocy of Britain’s energy system as it presently exists. Predictably the oil and gas extraction and supply industry are complaining about a “new and surprise tax.” Its spokeswoman worries that this will become a permanent feature.

This mouthpiece for the oil and gas oligarchs complains that with a sunset clause that gives an end date of 2025 that the new windfall tax on profits is a disincentive for investment.

Under capitalist ownership there is always a tension between paying out dividends and investment. 

In normal times energy industry profits reach stratospheric levels. For example, in 2020 British Gas made £27 million, EON £28m, EDF £106m, Scottish Power £478m and SSE £609m. In today’s peculiar conditions their profits are reaching new heights.

There is, of course, a simple mechanism for lifting these worries from the shareholders and bosses of this most profitable sector of the economy.

Take it into public ownership. In one single act the manifest problems of investing in a modern and reliable delivery of energy to industry and domestic consumers becomes not the subject of anxious preoccupation for these shareholders and bosses but the subject of a rational planning regime in the public sector.

The taxing problem of reconciling the competing demands of shareholders and the imperative to constantly invest in the industry are resolved. Take private ownership and profit payouts out of the equation and these problems vanish.

The timing of Sunak’s announcement, after weeks in which government refused to go beyond the limited measures — including the vastly unpopular “repayable loan” which it offered consumers as energy prices hot up — is not conditioned by ministerial anxiety about the domestic worries of millions of households facing unpayable bills. It is timed to deflect attention from the fallout from the Sue Gray report and new pressures on Boris Johnson.

Ministers have appeared on radio and TV to repeat the mantra that the Prime Minister has apologised and it is time to move on.

This is calculated to induce in the minds of voters the idea that new conventions now exist in which ministers and government officials are not obliged to obey the same rules as the rest of us. 

They want us to share their cynicism and double standards, to see politics and government as a game in which the mismatch between what is said and what is done is normalised.

A largely impotent opposition and a cynical and supine parliamentary Tory Party mean that, unless a critical mass of Tory MPs can be moved to compel a leadership bid, Johnson will not face challenge.

We will see if the Commons privileges committee — supposedly the guardian of parliamentary propriety — has either the will or the power to sanction Johnson for the one thing of which it is supposedly the champion: the convention that a minister who lies to Parliament must resign.

Everyone — from the cops on the gate at Downing Street to the No 10 cat — knows that Johnson is lying. This man has raised mendacity to the level of a government policy.

The scale of public anger and anxiety has compelled this retreat by the government. Let us make the People’s Assembly demonstration on Saturday June 19 — for higher wages and lower bills — a celebration of this success and the springboard for new concessions.

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