Weekly Commentary 11th June 2022

 

Utility Regulators without Teeth

The report this week from OFGEM about the storms earlier this year and the failures of Network Providers is yet another example of toothless regulation. They have been fined, of course, but despite that and allegedly scrutinising performance and capital expenditure by the Regulator it is evident that they have not failed in profits and dividends (see ENWLtd for example). It is as if this Utility privatisation was designed for that specific purpose. That is, a profit and dividend created Company with an Electricity Network Provider attached not the other way round! In detail we also have the further extortion of money from customers not only through usage charges but via the “Standing Charge”. This charge is for the wired connections, meter reading and customer service. If that is the case why does it vary so widely between suppliers but also on different tariffs with the same supplier. Is it not the case that those three elements are the same or very similar for all! I know the argument will be made that recently it has been necessary to use the charge to recoup losses where another company has ceased trading but that does not explain the huge disparities. In my own case 20.83p per day in February 2021 and 33.22p per day in September 2021 (prior to most company collapses) and with the same supplier! Moreover using the charge to accommodate customers from collapsed companies hurts the poorest most. So we have a failed regulation in relation to the resilience of the network, a failed regulation in relation to continuity of suppliers, yet profits are still made and dividends paid!

The Soap Opera Continues

I have long held the view that present day politics in Britain is a Soap Opera and continues to be so as the participants engage in mutual ego massaging. This week is a good example. Boris Johnson is doomed. Boris Johnson is saved but only for a while (don't kill the story just yet). Huge opportunity for Keir Starmer – Oh no! He’s fluffed it. The similarities all round are hard to ignore. Principally the lack of substance. Boris Johnson, his persona is deliberate superficiality (although History may attach more importance to Brexit, Covid and Ukraine than glasses of wine and birthday cake). But what can you make of Keir Starmer – it has to be more than I am not Boris Johnson. It also has to be more than “we would spend/invest more”; “we would be quicker”. I’ve been burrowing around looking for Labour policies as to what their government would be like. Apart from a “Green Paper” on Employment that is all I could find! A lot of work to do here both in the substance and giving Keir Starmer a personality.