David Cameron attacked by all sides over ‘panic’ pledge to cut green energy taxes
Prime Minister accused by both Liberal Democrats and Labour of sacrificing green credentials he won in opposition
Andrew Grice has been Political Editor of The Independent since 1998. He was previously Political Editor of The Sunday Times, where he worked for 10 years, and he has been a Westminster-based journalist since 1982. His column, Inside Politics, appears in The Independent each Saturday.
Wednesday 23 October 2013
The Coalition is at war after David Cameron pledged to cut the £112 of "green taxes" on the average annual household energy bill.
The Prime Minister was accused by both the Liberal Democrats and Labour of sacrificing the green credentials he won in opposition because he is in a "panic" over soaring gas and electricity bills.
Mr Cameron rushed out two announcements while he was on the ropes at Prime Minister's Questions over Sir John Major's called for a windfall profits tax on the "big six" energy companies and Ed Miliband's pledge to freeze prices for 20 months. Mr Cameron promised to "roll back" green levies and taxes on energy bills and said the energy giants will face an annual "competition test".
The green tax review provoked a major row inside the Coalition. The Prime Minister's spokesman said he was determined to reduce green taxes "one way or another"-probably by next year. An announcement is expected in the Chancellor George Osborne's autumn statement on December 4.
Cameron allies insisted the review would take account of the need to safeguard investment in the energy industry and to protect vulnerable people. The green taxes include help for those in fuel poverty and with home insulation. Any move to reduce these would be highly controversial, especially as Sir John warned that many people would have to "choose between keeping warm and eating" this winter.
The Lib Dems threatened to veto any cuts to green taxes. "There is only one way this Government decides policy-with both Coalition parties agreeing," said a senior Lib Dem source. "We are not going to allow a panic U-turn in the middle of Prime Minister's Questions to change government policy. We are happy to stress test the need for every penny that goes on to energy bills. But we will not damage the environment; reduce help for people in fuel poverty or damage our renewables industry."
All options will be considered, including switching some green taxes from energy consumers to general taxation. Their £112 annual cost is due to rise to £194 by 2010, about 14 per cent of the average energy bill.
Mr Cameron's move undermined his pledge to head "the greenest government ever." Zac Goldsmith, the Tory MP and environmentalist, said: "In 2010, leaders fought to prove they were the greenest. Three years on, they're desperately blaming their own policies on the other. Muppets."
The "big six" will feel the heat in an annual review that will see other regulators brought in alongside Ofgem, whose performance has been criticised. The Office of Fair Trading and the Competition and Markets Authority will join forces with Ofcom. Their agenda will include the companies' profits as well as their prices; how they treat their customers and barriers to new firms entering the energy market.
Details will be unveiled next week by Ed Davey, the Lib Dem Energy and Climate Change Secretary, in his annual energy statement to the Commons.
Labour insisted that 60 per cent of the current green taxes were as a result of Mr Cameron's policies and denied his claim they were imposed by Mr Miliband when he was Energy Secretary.
In a speech in London on Thursday, Mr Miliband will claim Mr Cameron has lost control of his Government. "In weakness and panic, he made up a policy on energy, which means business as usual for the energy companies and which is already falling apart," the Labour leader will say. "This Prime Minister is too weak to stand up for the consumer and he always takes the side of the 'big six' companies."
Diving in at the deep end is no excuse for shirking the style stakes
- 1 Game of Thrones author George RR Martin says 'f*** you' to fans who fear he will die before finishing Westeros saga
- 2 Loom bands: Bids for dress made from colourful rubber pass £170,000 on eBay
- 3 Why I'm on the brink of burning my Israeli passport
- 4 L'Oreal cuts ties with Belgium supporter Axelle Despiegelaere after hunting trip photographs
- 5 The true Gaza back-story that the Israelis aren’t telling this week
Game of Thrones author George RR Martin says 'f*** you' to fans who fear he will die before finishing Westeros saga
Loom bands: Bids for dress made from colourful rubber pass £170,000 on eBay
Supermoon 2014: When and why will the moon look bigger and brighter this summer?
Tommy Ramone dies: Last surviving founder and drummer seminal punk band The Ramones dies aged 62
Gaza-Israel conflict: The terrible price Palestinian children are paying for Israel’s war with Hamas
Sustained immigration has not harmed Britons' employment, say government advisers
War is war: Why I stand with Israel
7/7 memorial defaced on anniversary of 2005 attacks with ‘Blair lied thousands died’ graffiti
Australia facing international condemnation after turning around Sri Lankans at sea
Even when it brutalises one of its own teenage citizens, America is helpless against Israel
Socialist Worker called to apologise over ‘vile’ article saying Eton schoolboy Horatio Chapple's death is ‘reason to save the polar bears’
£70000 per annum: Harrington Starr: Information Security Manager (ISO 27001, A...
£30000 - £45000 per annum + Benefits + Bonus: Harrington Starr: C# Developer (...
£60000 - £80000 per annum + Benefits + Bonus: Harrington Starr: C# Integration...
£75000 - £85000 per annum + ex bens: Deerfoot IT Resources Limited: Biztalk Te...