The rush to support inherently socialist ideas, such as nationalisation of energy companies or freezing the energy price cap, seems to be the new fashion; but as true conservatives, we must reject this and be unashamedly capitalist. This crisis is an example of the market working; but the consequences of this are not at the fault of oil and gas companies, but failed Government policy on energy for decades.
This is a macroeconomic issue that has been ducked and can no longer be so. Politicians fiddling with the prices of energy simply distorts the market and prevents it from doing its sole job. A prime example used by some in the media is the lack of price rises in France. A nation which derives 70% of its electricity from nuclear, which we, at our own detriment, failed to invest in, and now has its main energy provider suing the French state due to President Macron’s policies of forcing them to sell energy below the market price.
The proposal by some to freeze bills with a shortfall being covered by a ‘deficit fund’ through government loans, paid for by a surcharge on bills, is an idea that will find friends in the Treasury. The notion that believing that oil and gas giants are profiteering on the backs of the poor is claptrap is not free market ‘headbanging’, but true. We all know when Government intervenes in a market, unnecessarily, it fails. Rent controls in Berlin, food prices in Venezuela, and even Mrs. May’s abysmal energy price cap.
Liz Truss is right. We should prioritise cutting taxes over handouts. The fact that saying this is now controversial proves how much we have moved away from fiscal conservatism, as a party. Of course, some families and households will require additional support, and will receive it, but we should be firm in our belief that this crisis will not be resolved until we have a serious strategy of supply-side reform and investment in energy, whether that be nuclear, fracking, or exploring the talents in the North Sea.
It is also concerning that, in a time of crisis, tough calls are not being considered. It is beyond me that no candidate, no politician, and no individual of importance has considered issuing guidance to individuals on reducing consumption. Germany has just announced a similar package, which they predict will save households around £9.1bn over two years. We must not take anything off the table, and this is one of those areas that will have to be discussed in a response package.
I will just add that some in our party seem to forget that we were fifteen points behind Ed Miliband in 2013, and we went on to win the first Conservative majority since 1992. We are at a similar place at present – with no strategy, no leader, and no plan. I have been a firm supporter of Liz Truss for many years, and if she wins, I see no reason why we cannot be optimistic, if we get the calls right. It is easy for an opposition to issue policies that look popular at face value that they will never have to implement. We must be honest, but also ensure that we are compassionate. There is a middle ground that can be struck; and if we play our cards right, we can win.
We should never shy away from our core philosophy, not even when it looks popular. We have a job to do, and with twelve years of a Conservative PM in Downing Street, the onus is on us to prove we are still up to the job. Ignore the naysayers, forget the pessimists, be proud of our nation, and hope and trust that we will deliver.
