The Guardian view on spiralling fuel bills: Johnson must get a grip
Before escaping on an official visit to India on Wednesday, Boris Johnson ensured that headlines were dominated by his spurious attacks on the archbishop of Canterbury and the BBC, rather than his own egregious behaviour during Partygate.
Deflection and bluster are, increasingly, what gets Mr Johnson through the day. This strategy of evasion is usually complemented by an earnest plea that he should be allowed to get on with delivering the priorities of the British people. At Wednesday’s prime minister’s questions, “fixing the energy crisis” was identified as one of the key areas Mr Johnson could focus on, if only people stopped harping on about him flouting the Covid laws he set.
The prime minister at least alighted on the right issue to make his rhetorical point. But far more than the usual Johnsonian cant will be needed to deal with the truly alarming scale and implications of spiralling fuel costs. Testifying to MPs on Tuesday, the CEOs of Britain’s major energy companies reported unprecedented levels of calls from customers who fear they will not be able to pay their bills. Further vertiginous price rises in October – when Ofgem is expected to again raise the price cap – could place 40% of households in fuel poverty.
In the words of the CEO of ScottishPower, Keith Anderson: “It has got to a stage now where the size and scale of it is beyond … what this industry can deal with. I think it needs a massive shift … in the government policy and approach.” There is naturally an element of industry self-interest here: energy bosses have no wish to be exposed to bad debts during a crisis that the money-saving expert Martin Lewis has warned could lead to civil unrest. But the central thrust of the CEOs’
analysis, shared by fuel poverty campaigners, is entirely correct: a perfect storm of economic factors, primarily related to the pandemic and the conflict in Ukraine, requires significant government intervention to protect people from the consequences of a broken market.
This could be some kind of deficit fund to help poorer households, as proposed by Mr Anderson, or another form of subsidy. But as families face unsustainable headwinds, proper economic support is imperative. At the same time, if the country is to meet its net zero obligations, the government must be more proactive in shaping a green transition that can cut bills by reducing energy use. Labour’s promotion of a £60bn scheme to insulate homes shows what could be done by a government without ideological hang-ups regarding state intervention. In Italy, where the government has offered a 110% tax credit on energy-efficient home renovations, 150,000 new jobs have been created since 2020.
There is no evidence that Mr Johnson
or his beleaguered chancellor, Rishi Sunak, wish to engage with any of this. Instead, the government has chosen to offer minimal support to vulnerable households, and temporary rebates based on the flawed assumption that the fuel price rises amount to a short-term spike. Its recently published energy strategy – delayed as Mr Sunak haggled over the cost – conveniently focused on long-term nuclear goals which may or may not be realised, ignoring the current cost-of-living crunch altogether. If Mr Johnson really wishes to “deliver on the people’s priorities”, his administration will need to snap out of its siege mentality, stop seeking out bogus dividing lines and get ahead of this crisis before it is too late.