[urlhttp://www.bbc.co.uk/news/uk-19986929[/url

Should we really expect our Prime Minister to speak off the cuff and not from a prepared text ?

When he threw in the line at PMQ's "I can announce... that we will be legislating so that energy companies have to give the lowest tariff to their customers, something that Labour didn't do in 13 years, even though the leader of the Labour Party could have done because he had the job." did he really mean that, did he think that he really meant that, or did he really mean to say that they are looking at making the Energy company's own voluntary code of conduct in which they should inform customers of their cheapest tarrif once a year, law, which is not the same as forcing them to always charge the lowest rate.

It wouldn't be quite so bad if it didn't throw the whole party ethos of private competition driving the economy into chaos, for if you force all of the engergy providers to always charge the cheapest tarrif available then you effectively take away any vestige of competition between them, they'll just all settle on the same rate - a fact which consumer groups have been clamouring to get onto the broadcast media to point out these last 24 hours.

Later on in the day he sent an underling, a random pleb, into the Commons to explain that they weren't quite sure how it would all work just yet etc etc etc, but its the latest example of our PM opening his mouth under times of stress and saying anything to score imaginary points in the game of "debate" that they all hold so dear.

I couldn't give a flying one about who sounds best in parliament or who can "win" an argument (you never win an argument, especially when you don't need to, ie you have a majority and you force them to agree with you anyway), but I would rather like someone at the helm who doesn't seem to be making it up as he goes along, literally from one minute to the next.

Why do there exist tariffs above the lowest? That's the real question. Who could possibly benefit from those?

Well I think it's a great idea. In fact, it should be expanded and apply across the board, every trader should be compelled by law to sell me whatever I want to buy at the cheapest possible price, in the case of most goods, that's 1p above cost, but for stuff like petrol it could even be say 0.09p a litre. The man's a bloody genius, I tell ya.

It's a quick way of getting rid of unstransparent tariffs though. Each company will logically go back to a single tariff. Provided that cartel can be avoided (unlikely) and people have choice of supplier it might just drive prices down. In reality, it won't though as there is no real competition and its an artificial market.

Well, "lowest" is different according to your circumstances, and there's hardly anything wrong with a company offering additional discount for a longer term commitment / charging a premium for a lack of term commitment.

Not really, until all tariffs are made simpler and easier to compare then people will still be put off from switching. The threat of customers leaving to go to a competitor is the best way to lower prices or improve service.
Instead of forcing companies to put people on their lowest tariff, I'd restrict the number of tariffs a company can offer and tightly control/simplify the tariffs.
Do away with 2 tier pricing (or at least make tier 1 the same price and consumption across all companies).
Do away with monthly/yearly/leaving fees or standardise them.
Give consumers more information about their usage ie what they use in summer, what they use in winter, and an average over the whole year.

Then I think it gets much easier for people to compare companies and tariffs. Right now, it's an absolute nightmare and takes hours to compare just a few.

What? I change gas and/or electricity supplier regularly. It takes literally minutes on any one of the comparison websites, and instantly see exactly how much savings, to the penny, you would be able to make with any of the energy companies, listed in order.

These sites know all the prices and all the tariffs, and you have absolutely no need at all to look anything up yourself.

In most cases there's a click through to apply to change suppliers, and then it's all taken care of for you. It's pretty much the easiest thing in the world. All you need to is remember to cancel your old DD at the relevant moment so the other buggers can't continue to rob your account and job done.

We've just chnaged gas supplier to NPower, who are of course famously about to put their prices up. But as i am a new customer I am getting a fixed lower price till January 2014, and this is unaffected by the price rise.

Which kind of neatly moves on to the other point - it is only because NPower are offering me as a new customer the best deal, that they are getting my business. If that isn't empowering the consumer, and a good reason for them to offer such deals, what is? Pretty much all companies will offer new customers deals to secure new business. What is wrong with that?

His plan, like most of his, is complete nonsense.....Surely, if everybody has to get the lowest tariff, then that will just drive up that 'lowest' tariff, because the energy companies will simply offer an average price??....



His plan actually flies in the face of the classic Conservative thinking of a free market and if put into practice then you may as well put the energy market back into the hands of the state?

No, because "lowest tariff" doesn't mean "lowest tariff across all suppliers" it means the lowest tariff that supplier has.
What it means is that if for example you signed up to an off-peak usage plan that for example had higher rates for peak times and lower for off-peak, but actually used lots of peak power and little off-peak power and would have paid less on a different pricing structure, you should be put onto that plan by the power company.
Tariffs are still going to be different between suppliers, and within a single suppliers different tariffs will be different for different people.

The energy companies can easily cope with tinkering like this.
The total cost for the energy supplied will be no less than before.
I am pretty sure the Conservatives know that and just want to appear to be doing something about it, when in truth this in no way addresses relentless, above index, price rises.
Lip service as usual.

I'm with Scottish Power. They have all of three pricing plans - Standard Rate, Fixed Rate, Online Discounted. That's it.

Not sure how it could be made much simpler TBH.

And Cameron's latest wheeze will have only one highly-predictable outcome. Every energy company will remove every price plan apart from their most expensive one, which will [ide facto[/i become their cheapest. And we'll all have no option but to accept it.

Terrific.

Aaaaaaah, so are you saying the companies will HAVE to contact a customer and inform them that they are being shafted and that they will be immediately moved onto the more convenient and cheaper tariff??

Sounds great in theory, but something tells me that if they have to do this sort of thing for millions of customers, then those nerds who change their priceplan every few months, while chasing the cheapest deal, are ultimately going to be the big losers, because as my overly expensive bill comes down, somebody elses is going to have to go up to fund my price saving.

Correct, although choosing the wrong deal doesn't necessarily equate to "being shafted"



Correct. It's a subsidy on idiocy.

That is not what Cameron said. He said he would force companies to [igive[/i their customers the companies lowest tariff.

What would the effect of this be:

"I asked the boss of one of the UK's biggest energy companies what would happen if they were forced by the government to give all their customers the lowest tariff they offer."

"It is very simple" he said. "If we could not adjust charges depending on how people pay, we would have to raise our basic price".

from here

[urlhttp://www.bbc.co.uk/news/business-19997139[/url

In other words Cameron's idea removes the kind of market you allude to in your post.

What this episode illustrates though is the market that does exist is a sham and is only there because the companies manage to rip people off precisely because some people do not qualify for a companies lowest tariff.

The other glaring problem is if say British Gas came out with the lowest industry-wide tariff for Gas then given they would be compelled to offer that tariff to all their customers. The logical result of that is the entire gas consumer population would switch to British Gas and all the other suppliers would go bust!

This farce and the rail franchise one ought to have the Labour party considering the re-introduction of clause 4!

Cameron was an utter fool to bleat this one out.

There is no reason I can think of in principle why utilities alone should be compelled to offer their "best price" to every customer. That is, if you accept that these are just businesses like any other.

I believe that Cameron whinged because the thought occurred to him, while standing at the despatch box, that in fact energy is a distress purchase, everybody needs to keep warm and to cook etc., and so why should they be fleeced by suppliers in the name of greedy profits.

Well Dave, this is what you get if you sell off the family silver. Maybe once you've cracked this one, you can make sure every train traveller gets the same price cheapest ticket too.

I honestly think that he'd been briefed recently on the voluntary code of practice that the suppliers have signed up to in which they state that they will write to each customer once a year and inform them of what is their cheapest tariff, leaving the decision up to the customer as to whether or not to change - they fulfill their promise just by informing you once a year.

I think that in his mind while he was struggling for a good news response to beat the opposition down with, the utilities discussion came to mind and he decided that rather than being a voluntary code he'd rather like to make it law.

And then he opened his mouth and some different words came out that afterwards, with proper consideration, actually meant something completely different so that his pleb underlings have had to do a bit of sidestepping since.

Its all born of the crazy point-scoring exercise that passes for "debate" in the Commons - why on earth they just don't put an hour aside every Tuesday for all the MPs to have a punch up across the woolsack is beyond me, it would achieve far more and be a lot more entertaining on TV than watching public schoolboys trying to win the school debating medal for shouting the loudest.

A bit off topic but this is something I've been wondering for a while, so hopefully someone can explain.

How is it that the energy companies know what proportion of energy I've used at on and off peak times, yet they don't have a clue how much I've used in total without me first telling them?

Maybe because the woolsack is in the House of Lords?

Off topic, but Cameron is a dreadful public speaker and this just smacks of a flustered policy announcement, like Osborne's Greggs tax, announced by a PM desperate to say something that Daily Mail readers will lap up

I listened to PMQs (as I usually do) and was struck more by his pathetic reply to Chris Bryant's question:

Bryant asked: "Why won't the prime minister publish all the texts, emails and other formers of correspondence between himself and his office, and Rebekah Brooks and Andy Coulson and News International … so that we can judge whether they are relevant? Is it because they are too salacious and embarrassing for the prime minister or is it because there's one rule for the prime minister and another one for the rest of us?"

Cameron told MPs they should remember that Bryant had "stood up in this House and read out a whole lot of Leveson information that was under embargo that he was not meant to read out, much of which turned out about me to be untrue."

He went on: "And he has never apologised. Do you know what, [uuntil he apologises I am not going to answer his questions[/u."

Sorry but if that is the best the leader of our nation can manage, then the petulant little 2@ should sit down and shut up

Lack of price transparency is a major problem in energy markets and also with things like mobile phones. When consumers can't compare prices between sellers easily it means sellers can take advantage of buyers lacking information and can hike up their prices.

One thing that always amuses me is how the right wingers always like to say how the free market is best. If there are issues like the minimum wage or trade union rights the right wingers jump up and down and say "this is interfering with the free market".

But they are strangely lukewarm at campaigning on issues like this - or a lot of the behaviours in the banking sector which are based on taking advantage of uninformed customers in exactly the same way.

so, let me get this straight, the pm (a tory who kills babies and kittens) comes out and says that at the end of a customers fixed rate term, the energy company should automatically put the customer on their lowest available tariff (as opposed to the 2nd highest one that e.on just shoved me on) and people are complaining he's a fool for saying it because they think the energy companies will just hike the prices and form a cartel unlike what they've been doing for years?

Has anybody who has so far posted actually looked at the chart accompanying the article? Retail margins are not the cause of ever-increasing power bills - rising costs are.

Some of those costs are avoidable to a degree - customer churn (i.e. changing suppliers) costs a fortune (all the companies spend a lot of money chasing and retaining customers which, oddly enough gets added everybody's bill and in the end is a zero-sum game), as does renewable energy (in the UK a significant component of the wholesale energy cost and much more expensive than fossil fuels) and supply reliability (if people were willing to accept a less reliable electricity system some costs could come down considerably).

The real question to me is why aren't people given the right information to make choices? For example, do you want to pursue green energy policies, or do you want to abandon them and pay lower bills? Would you accept lower electricity system reliability (e.g. say outage 20 hours a year) in return for a £ saving?

All of these things can and should be quantified so people can make informed choices. As it is, too many of the debates are hijacked by politics (in the case of green energy) or simple inability to question orthodoxy (reliability is king).

Well thats even better, I'd pay with my own money to see two aged Lords in Ermine thumping each other with windmill arms over a sack of wool - and the aftermath of holding best steak to cartoon black eyes and bags of ice held to heads would be even better.

Extrapolating your argument to its logical conclusion would mean that you weren't placed onto the fixed term rate in the first place because it wouldn't be the cheapest - taking Camerons proposal at its exact word the electricity company would be breaking the law, comitting a criminal offence, by offering you a fixed term rate that wasn't their cheapest rate.

Indeed, fixed terms would be impossible administer any longer because inevitably at some point in their life they would become not the cheapest option and therefore illegal.

Those are exactly the words he used, rather ineptly, and caught his own Engery Dept out in the course of doing so, and prompted the Energy Suppliers to issue a statement saying that this was the first that they had heard of this proposal.

I don't think he's serious about it at all, just looking for something to throw at the opposition during their Tuesday squabble.