Labour’s answer to the energy crisis? Corporate welfare

Labour’s answer to the energy crisis, spurred on by the war on Iran, is to subsidise the profits of fossil fuel companies. According to the Times, only households on benefits will receive the money that helps prop up energy companies.

Instead, Labour should bring energy into public ownership, while transitioning to a Green New Deal to address not only the climate crisis, but volatile international markets and sky high costs, in one fell swoop.

Corporate stranglehold

While energy is privatised, companies have a stranglehold on individuals in our society. The free market is supposed to be about an individual choice, but everyone needs energy so there is no choice but to purchase it from a provider. Households and businesses’ costs may deviate across companies, but publicly owned energy could provide the absolute cheapest through wholesaling renewables for the entire country.

Labour has so far announced a £53 million support package for “vulnerable” households who use heated oil.

Labour — welfare for large companies

Again, the market is supposed to be ‘free’, yet corporations receive huge benefits from the government. 22% of The Union of Shop, Distributive and Allied Workers receive universal credit (UC). That means the public purse is significantly subsidising the profits of companies like Tesco, which makes £6,150 of profit per employee.

Direct subsidies is another way the public purse delivers corporate welfare. The government is providing £2.5bn to the steel industry this parliament, without taking a stake in steel companies that would provide public monetary benefit.

This is a continuation of the Conservative agenda. In the 2023/24 year, some of the government’s subsidies to corporations amounted to a whopping £32bn. The year before, they were £53bn because gas inflation not only increased bills but also the government increased corporate handouts to profiteering fossil fuel companies. And now Starmer has announced a further £22bn bung to the fossil fuel sector for carbon capture projects that don’t work.

Government intervention appears to be focused on benefiting corporations, rather than the whole of society.

Featured image via the Canary