Sir John Major told a Westminster lunch this afternoon that the government should impose an emergency tax upon the energy companies to help families keep warm this winter. Here is a transcript of what the former Conservative Prime Minister said:
I think when Ed Miliband made his suggestions about energy some weeks ago, I think his heart was in the right place but his head had gone walkabout. But he did touch on an issue that’s very important. The private sector is something the Conservative party supports, but when the private sector goes wrong, or behaves badly, I think it’s entirely right to make changes and put it right.
Governments should exist to protect people, not institutions, and I very strongly agree with what the Archbishop of Canterbury had to say just the other day. There’s a lot being done… to help people in fuel poverty, the winter fuel allowance, which I think is about £300, the cold weather payments, which are another £25… so quite a lot is being done.
But at the moment I do not see how it can be in any way acceptable that with energy prices rising broadly 4%, in terms of costs, that the price for the consumer should rise the 9 to 10%. I do not regard that as acceptable at all by the energy companies.
And I recall being social security minister… and we had a very cold spell and I was the minister, and eventually it was very clear because of the cold spell we handled increased cold weather payments very speedily, and I predict this winter, Sod’s Law being what it is that we’ll probably have a very cold winter, and it is not acceptable to me, and ought not to be acceptable to anyone that many people are going to have to choose between keeping warm and eating, that is not acceptable.
And so if we get this cold spell the government I think will have to intervene, and if they do intervene, and it is costly, I for one would regard it as perfectly acceptable for them, then subsequently to levy an excess profits tax on the energy companies and claw that money back to the exchequer where their primary job is to get the economy working and people back to work.
I do not regard it as acceptable that they have increased prices by this tremendous amount. Nor do I regard their explanation as acceptable, that they are investing for the future. With interest rates at their present level, it’s not beyond the wit of man to do what companies have done since the dawn of time and borrow for their investment rather than funding a large proportion of their investment out of the revenue of families whose wages have not been going up at a time when other costs have been rising, and it is for that reason I think the Archbishop of Canterbury is absolutely right to speak out, I thoroughly agree with him.
I believe there will be difficulties this winter without action and if there are those difficulties, the Chancellor will have my total support if he acted in the way I suggest and then imposed an emergency impost upon the energy companies to claw back the money that we will have to give to people to help them to see the winter in any form of warmth.
Number 10 responded shortly afterwards, saying:
Tags: Conservatives, Ed Miliband, energy bills, John Major, UK politics
‘This is a very interesting contribution to the debate. But we have no plans for a windfall tax.’