Business Comment: Battle faces an uphill struggle

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The Independent Online
Perhaps the past eighteen years have dulled the senses but when did you ever again expect to hear a minister take responsibility for something? Anything? Michael Howard turned denial into an art form and in the process spawned a generation of politicians for whom the concepts of power and blame were mutually exclusive.

So it is something of a shock to hear the Energy Minister, John Battle, state unequivocally that the buck will stop with him if the opening up of the domestic electricity market fails to start on time next April. Up until now the whipping boy has been Professor Stephen Littlechild.

Taking responsibility is one thing, making it happen is quite another. With a minister now in charge as opposed to sniping from the sidelines as did his predecessor, Tim Eggar, there is at least a chance that where there is a political will, there will prove to be a practical way.

But the obstacles remain daunting. On present assumptions, only three of the 14 electricity suppliers will be ready to take part in a competitive market from 1 April and there are plenty who believe consumers in some parts of the country will still be waiting to choose who they buy their juice from well into 1999.

Then there is the question of cost, which will remain a bone of contention between Professor Littlechild and the RECs for some while yet. The RECs will not be allowed to pass on the full pounds 850m they say it will cost to get the computer systems up and running, but can it be done for the pounds 380m that the Professor has agreed to?

Finally there is the not entirely irrelevant question of what the point of the whole exercise is in the first place. Every extra pound spent on getting ready for 1998 makes the case for liberalising the market yet more marginal on economic grounds when at best we are looking at initial price reductions of 5 per cent. It will surely take deeper cuts than that to overcome the inertia factor.

Mr Battle presumably knows this but he is fighting the war for liberalisation of the energy markets on a wider front. Labour is committed to opening up Europe in this area so its ability to make a success of things on home turf takes on added importance.

That gives him a real incentive to succeed. The other stimulus might be the memory of the last Conservative politician to resign because of a failure of policy - Lord Carrington, who quit as Foreign Secretary over the Falklands invasion. We will have to wait and see whether 1998 becomes Mr Battle's personal Belgrano.

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