Donald Macintyre's Sketch: Never mind the customers, pity the poor executives

Despite differences, the committee was united in its disdain for the companies

Putting up your energy prices hurts us more than it hurts you. That was the shock revelation during the testimony of Britain’s “Big Six” utility companies. SSE “regrets profoundly” having to raise customer costs by 10 per cent, said William Morris, its managing director. “None of us want prices to rise.”

British Gas “thought deeply” before whacking 9.2 per cent on to bills, explained its managing director Ian Peters. It’s “the hardest decision we take”, insisted Neil Clitheroe, chief executive of Scottish Power, which is raising charges to 2.2 million customers by 8.6 per cent.

Our sympathies immediately switched to the boardrooms of the energy giants, where sweating, grim-faced directors had sensitively agonised about the suffering they were inflicting on their customers. It was tough for them too. Clitheroe explained that 60,000 customers called in with their worries “virtually straight away” after the rise, adding that the company continued to “manage each one of them”. He did not elaborate on how – but this presumably at least involves a Clintonian affirmation that “we feel your pain”.

Asked by the less-than-sympathetic Labour MP Albert Owen how his annual bonus had fared in this period of rising prices, Clitheroe explained it had remained “flat” and was based on “customer and employee satisfaction, cost controls and profits”. You have to hope for his sake that the Scottish Power remuneration committee is well satisfied with performance in the last three categories since “customer satisfaction” seems unlikely to soar this year.

SSE’s Morris was also “profoundly worried” about loose talk of people (like, though for some reason Morris did not mention this, the crazed anti-capitalist eco-warriors Sir John Major) having to choose between “eating and heating” this winter. This was quite unnecessary because “the systems are in place to prevent that”. This played to a wider Morris theme, that the Big Six’s problem was their failure to get their message across. The message was largely their use of (some of) their huge profits for investment, and that green subsidies – currently a “poll tax” as Eon’s Tony Cocker described it – should be switched to general taxation.

Certainly, it was hard to penetrate the Big Six’s reasoning, despite their repeated boasts of “transparency”. Maybe there are answers to the question from John Robertson, the abrasive Labour star on the committee, about why the dividends reflected the 23 per cent profits of the companies’ generating arms, while the price rises only reflected retail profits. But as the Tory MP Dan Byles pointed out, the companies’ structure and profits remained a mystery. “Would you accept that your accounting and reporting practices fail the basic tests of transparency?” he asked.

Despite its differences on a solution, the committee was united in its disdain for the companies. This was bolstered by the cuckoo in the industry line-up, Stephen Fitzpatrick, the volubly persuasive managing director of smaller independent firm Ovo Energy, who said he simply “can’t explain” the price rises and declared that “a lot of energy companies … are charging the maximum price they feel they can get away with.”

As the Tory Philip Lee put it: “There is a suspicion that you are a chorus line acting in concert.” Nobody used it, but it was hard to look at the Big Six without thinking of a good old fashioned word: cartel.

Start your day with The Independent, sign up for daily news emails
Have you tried new the Independent Digital Edition apps?
News
ebookA unique anthology of reporting and analysis of a crucial period of history
Latest stories from i100
Have you tried new the Independent Digital Edition apps?
Independent Dating
and  

By clicking 'Search' you
are agreeing to our
Terms of Use.

iJobs Job Widget
iJobs General

Guru Careers: Software Developer / C# Developer

£40-50K: Guru Careers: We are seeking an experienced Software / C# Developer w...

Guru Careers: Software Developer

£35 - 40k + Benefits: Guru Careers: We are seeking a Software Developer (JavaS...

SThree: Trainee Recruitment Consultant / Resourcer

£18000 - £23000 per annum + Commission: SThree: As a Trainee Recruitment Consu...

Ashdown Group: UI Developer - (UI, HTML, CSS, JavaScript, AngularJS)

£25000 - £40000 per annum: Ashdown Group: UI Developer - (UI, JavaScript, HTML...

Day In a Page

Sun, sex and an anthropological study: One British academic's summer of hell in Magaluf

Sun, sex and an anthropological study

One academic’s summer of hell in Magaluf
From Shakespeare to Rising Damp... to Vicious

Frances de la Tour's 50-year triumph

'Rising Damp' brought De la Tour such recognition that she could be forgiven if she'd never been able to move on. But at 70, she continues to flourish - and to beguile
'That Whitsun, I was late getting away...'

Ian McMillan on the Whitsun Weddings

This weekend is Whitsun, and while the festival may no longer resonate, Larkin's best-loved poem, lives on - along with the train journey at the heart of it
Kathryn Williams explores the works and influences of Sylvia Plath in a new light

Songs from the bell jar

Kathryn Williams explores the works and influences of Sylvia Plath
How one man's day in high heels showed him that Cannes must change its 'no flats' policy

One man's day in high heels

...showed him that Cannes must change its 'flats' policy
Is a quiet crusade to reform executive pay bearing fruit?

Is a quiet crusade to reform executive pay bearing fruit?

Dominic Rossi of Fidelity says his pressure on business to control rewards is working. But why aren’t other fund managers helping?
The King David Hotel gives precious work to Palestinians - unless peace talks are on

King David Hotel: Palestinians not included

The King David is special to Jerusalem. Nick Kochan checked in and discovered it has some special arrangements, too
More people moving from Australia to New Zealand than in the other direction for first time in 24 years

End of the Aussie brain drain

More people moving from Australia to New Zealand than in the other direction for first time in 24 years
Meditation is touted as a cure for mental instability but can it actually be bad for you?

Can meditation be bad for you?

Researching a mass murder, Dr Miguel Farias discovered that, far from bringing inner peace, meditation can leave devotees in pieces
Eurovision 2015: Australians will be cheering on their first-ever entrant this Saturday

Australia's first-ever Eurovision entrant

Australia, a nation of kitsch-worshippers, has always loved the Eurovision Song Contest. Maggie Alderson says it'll fit in fine
Letterman's final Late Show: Laughter, but no tears, as David takes his bow after 33 years

Laughter, but no tears, as Letterman takes his bow after 33 years

Veteran talkshow host steps down to plaudits from four presidents
Ivor Novello Awards 2015: Hozier wins with anti-Catholic song 'Take Me To Church' as John Whittingdale leads praise for Black Sabbath

Hozier's 'blasphemous' song takes Novello award

Singer joins Ed Sheeran and Clean Bandit in celebration of the best in British and Irish music
Tequila gold rush: The spirit has gone from a cheap shot to a multi-billion pound product

Join the tequila gold rush

The spirit has gone from a cheap shot to a multi-billion pound product
12 best statement wallpapers

12 best statement wallpapers

Make an impact and transform a room with a conversation-starting pattern
Paul Scholes column: Does David De Gea really want to leave Manchester United to fight it out for the No 1 spot at Real Madrid?

Paul Scholes column

Does David De Gea really want to leave Manchester United to fight it out for the No 1 spot at Real Madrid?