A timely escape

Recent reports in the media have highlighted the rapid failures of many smaller energy companies as a result of their failure to protect themselves from massive increases in wholesale gas prices.

These companies have racked up huge debts and their clients are now being passed indelicately to other suppliers, frequently at higher cost to the customers.

Portsmouth City Council, through it’s leader Gerald Vernon-Jackson, decided to halt Victory Energy, but were forced to delay that withdrawal by other parties; as it turns out, the council lost about £5m. Had Victory Energy not been halted, the council's losses would have been much more significant and the disruption to the lives of the people who had unknowingly signed up to a bad idea would have caused mayhem.

Large commercial companies invest heavily in risk assessment and don’t stray comfortably from their core business, whatever the story about potential profits. If local authorities wish to pursue engagement in business sectors that aren’t their core business then they must ensure they follow at least the same rigorous control processes as a commercial company.

Victory Energy was very strongly defended by PCC’s chief executive, the chief financial officer, and the city solicitor at the time, as well as the then leaders of the two other major political parties. Perhaps we could ask them to comment now on how they feel about the strong support they provided then, and what they suggest the council does now to prevent such problems occurring again?

Without the leader of the council acting with strong and persistent resolve we the taxpayers would be facing huge debts from Victory Energy. Jerry Brown Marion Road, Southsea