The fuel crisis… the challenge of Britain’s new leader

Sunday 28 August 2022 04:28 GMT
The fuel crisis... the challenge of Britain's new leader

Last week we warned of a big jump in fuel and energy bills, whether domestic or in institutions that manage aspects of economic activity, from transportation and transport, to productivity such as factories and farms, or in the investments and businesses of the consumer and commercial market, that is, which determines prices in the market. Talk here about Britain; But the size of its economy (3 trillion and 320 billion dollars in 2022) and its overlap with the outside world (738 billion dollars in exports, 772 billion in imports in 2021) lead to economic and financial change to expand its tangible effects to the attention circle of our readers, their economic activity and the daily life of many of them. The Office of Fuel and Energy Price Control (“Asharq Al-Awsat” last week) raised the ceiling of the average bill prices allowed for household energy saving companies (including gas and electricity, and their number is close to 40, after 62 of them went bankrupt affected due to the rise in gas prices since last winter) to take it from homes, by more than 80% of what it is today, to reach about 4,200 dollars annually, as of October of this year. This has an almost entirely negative effect on the entire economy; Because the ceiling on accounts’ prices is reviewed every 3 months, which means that another increase is expected to take effect from the first day of the new year, to reach $5,900. But this price cap does not mean that it is the maximum that the UK family will have to pay, which the Office for Energy Prices has meant for the average size of house (3 bedrooms) and there are millions of houses and dwellings larger than this size, of which most date from the nineteenth century, and chimney heating The fireplace is open to the rooms, and the engineering design is high ceilings, wide windows and ventilation outlets (to avoid poisoning of gases due to the burning of coal and wood).

Environmental cleanliness and climate change laws prohibit the use of coal and firewood, which has led to the dependence of these houses on central heating with boilers fired by gas or oil, some by electricity, and a few by heated air; But the old house design leads to energy leakage and loss.

In practice, this means that more than half of Britain’s housing units are likely to pay their energy bills more than $8,000 a year, and by the start of the year will be more than 10,000.

More than a quarter of UK homes live in energy poverty. The definition of the Ministry of Energy and Climate Change (in 2013) for the energy poor: that the cost of household energy is higher than the invoice price ceiling set by the office, therefore the payment of bills does not leave the monthly budget of the family enough to spend on basic needs that put them above the poverty line (that is, what is left of their monthly income is less than two thirds, after spending on basic things such as bills, rent or purchase payments).

In practice, however, the reality is worse; According to the report of the Social Advice Offices for Citizens, which are offices established by the government in 1939, staffed by volunteers, and numbering more than a thousand offices in the middle of World War II; But in the last three decades it has been funded by a charitable foundation, financed by donations, with a budget of up to 9 billion dollars, and it is staffed by volunteers, including lawyers, economists, doctors and specialists in all fields. Office sites and call centers typically receive about 3 million site visits, phone calls and interviews a year, up 40 percent in the past three months, before the latest energy price hike. According to the Foundation’s report, the energy poor are unable to pay bills on time, or have changed their lifestyle, such as resorting to public bathrooms, or not cooking some meals, to save energy for heating. of water and the use of the kitchen. The number of these people rose from 6 million and 300 thousand homes in April this year to 9 million and 200 thousand homes this week, and the report expects the number to exceed 10 and a half million with the new increase, or about 45 million British citizens.

The proposed solutions take 4 directions: the first of which is the socialist, with the opposition Labor Party’s proposal to freeze prices (and in turn reduce inflation rates because it is the result of high energy prices), and to compensate for the loss of energy supply of companies by imposing an extraordinary tax on large oil and gas companies.

The Conservative Party leadership candidate, former finance minister Rishi Sunak, did not initially reject the extraordinary tax on oil companies, proposing to increase some taxes to offset the budget deficit, and to support low-income people with grants to helping them pay for energy. bills.

The second solution is proposed by domestic energy saving companies, that the treasury gives them the support that Sunak promises, so that they direct it only to families classified as energy poor, by reducing their consumption bills.

The second party leadership contest, the foreign secretary, Elizabeth Truss, publishes Thatcher principles, rejects taxes that intimidate investors, and promises lower public taxes on citizens to move the consumer market, including a green tax on energy bills. The latter is distinguished by the fact that it is the only one that approaches the absent truth, namely the cessation of the exploitation of North Sea gas and shale gas, with caution in response to the hysterical campaign waged by the left and the Green movement. to divest from hydrocarbons, leading to Britain’s dependence on energy imports after being an exporter.

In a poll conducted by Opinium, of the nearly 600 Conservative members who voted for a new leader, 61 percent said Mrs. Truss chose, and 39 percent Sunak. Of the 348 who voted for Terrace, 14 percent said he was the better of the two for leadership, an equal percentage as the most trusted, while 8 percent preferred his economic program.

This does not mean that 86 percent of them prefer SONAC; But that’s the way the poll is worded to ask, “Who do you prefer as the leader of the party?” Sixty-three per cent preferred Boris Johnson to remain as leader, while only one fifth preferred Terrace.

Only two per cent of Truss’s supporters divided their motives between being ‘English’ and being ‘white’; The funny thing is that the vast majority of users of social media platforms in Arabic, even those living in Britain, believed that ethnic factors and skin color were the main reasons for the preference of Conservative Party members for Terras.

Middle East London

All published articles express the opinion of their authors and do not necessarily express the opinion of “Arabic 21”

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