Does Theresa May's energy cap fit?

Britain’s PM May vows to put an end to “rip-off” energy bills

According to data released by the Competition and Markets Authority (CMA) previous year, 70% of customers of Britain's "Big Six" energy providers - British Gas owner Centrica, SSE, E.ON, EDF, Scottish Power and nPower - have failed to switch from the highest standard variable tariffs.

"So I am making this promise: if I am re-elected on 8 June, I will take action to end this injustice by introducing a cap on unfair energy price rises". "We will legislate and this will be part of our manifesto".

In a session of Prime Minister's Questions in October 2013, then-PM David Cameron told Miliband: "You want to live in some sort of Marxist universe where you control these things but you need a basic lesson in economics".

Tweeting at energy secretary Greg Clark this morning, Mr Miliband argued the Tories were offering no clear guarantee that energy prices "won't rise next year".

"I don't think any government can ever promise that no bill is going to go up year on year", she said. The cap will apply to 17 million families standard variable tariffs.

Britain's competition body in 2016 ordered suppliers to cap prices for customers on prepayment meters but the latest plan by May's Conservatives would mark the first time since privatisation of the industry in 1990 that a government intervenes to cap prices across the market.

A cornered energy industry said the Conservative Party's election manifesto pledge to cap prices put "competition at risk".

Elderly people, poor and disabled people are among those less likely to switch providers and therefore find themselves on overpriced rates as a result, which in turns boosts the providers' coffers.

In other words, it was not totally ideologically opposed to caps where competition isn't working but it considered a cap on standard tariffs a bad idea. "Too many people simply aren't getting a fair deal", said Theresa May in The Sun.

He said: "They can get the future prices wrong and the cap wrong - prices can fall and people can be left stranded on higher energy bills and pay a lot more". That would imply that if wholesale prices continue creeping up, as they have in Ofgem's cost supplier index, bills will go up despite the cap.

The policy echoes a pledge made by the opposition Labour party ahead of the 2015 election.

"We are all concerned about the impact of energy bills on the cost of living, but the way Miliband has responded to that in the long term, and also in fact in the quite near term, will have a profound impact in driving up the cost of energy".

Even consumer groups are anxious that consumers will become less bothered trying to find a good deal if they think the government is doing it for them.

"It is important that these measures bed in before looking to further interventions".

Bosses at British Gas owner Centrica and ScottishPower have also recently spoken out against the proposal, warning that it could lead to higher bills for consumers and reduce competition.

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