Energy windfall tax petition snubbed

THE majority of MPs in the Westcountry will not sign a

petition calling on Gordon Brown to levy a one-off windfall tax

on energy and utility companies.

The petition, organised by the left-wing pressure group

Compass, asks that a share of the profits made this year by the

main energy providers, which it says are up from £557 million

in 2003 to £3 billion this year, be used to help Britain's

poorest.

Most MPs in Cornwall and Devon said they agreed with the

principle of the petition but insisted it would be practically

impossible to levy such a windfall tax because most energy

companies are big multinationals and make some of their profits

abroad.

MPs in the region believe it would make more sense to levy a

tax on the profits that energy firms have made through the EU

carbon emissions trading scheme.

Richard Younger-Ross, Lib-Dem MP for Teignbridge, said he

would support the idea on principle but would not sign the

national petition.

He said: "As an MP I use early motions in Parliament to make

my views known. If I started signing national petitions I would

receive every petition there is under the sun.

"It's a good idea to claw some of the profits these

companies are making back to help those who can't afford to pay

their energy bills, so long as the Treasury does not use this

money for any other purposes."

Matthew Taylor, Lib-Dem MP for Truro and St Austell, agreed,

saying: "In theory it's a great idea. These companies have made

huge profit through no investments of their own, just because

of the market speculation.

"If the Government can get some of these profits back to

help poorer people, then all the better."

It would not be the first time the Labour Government had

levied a windfall tax on energy firms. In 1997, when it came to

power, it raised £4.5 billion to fund its new deal for the

unemployed.

This time round, Compass believes billions could again be

raised with the view to help people who are suffering from the

rising costs of living or have been plunged into fuel

poverty.

Compass's petition said: "Part of the money raised should be

used to immediately help those struggling with rising fuel

bills and should be particularly targeted at families in or

facing fuel poverty."

The Prime Minister, who returned yesterday from the Olympic

Games' closing ceremony in Beijing, has shrugged off demands

for a windfall tax on energy companies' profits. Instead, he

favours increasing the amount these firms pay for pollution

permits.

Originally permits under the EU carbon emissions trading

scheme were free, leading energy firms to make an estimated £9

million profit out of them.

Now Labour ministers want to auction seven per cent of them

– a measure that could raise £2 billion over four years. This

could be extended to 10 per cent, which would bring in a

further £500 million.

Hugo Swire, Conservative MP for East Devon, said it should

be up to the individual companies to decide to share out their

huge profits and not see a tax imposed on them by central

Government.

He said: "We need to address the fundamentals of the

economy. Why has council tax risen so much?"

Julia Goldsworthy, Lib-Dem MP for Falmouth and Camborne,

said that the petition for a windfall tax was only looking at

energy firms' profits but should look at the profits made under

the EU carbon emissions trading scheme instead.

She said: "These firms have made £9 billion under the

emission trading scheme and some of this should be going

towards increasing energy efficiency and helping people who

face rising costs of living and fuel poverty.

"That would be a better approach than just taxing them on

their profits which may have been made abroad."

Adrian Sanders, Lib-Dem MP for Torbay, agreed, saying: "If

it's about a windfall tax on the huge profits these companies

make from the emissions trading scheme, then it's brilliant. I

would sign such a petition.

"But if it's just on their profits, then when you think most

of these companies' profits are made in other countries, I

don't think it would bring in much money. Besides, it would

jeopardise these companies' ability to carry on operating in

this country."

St Ives Lib-Dem MP, Andrew George, said he would only sign

the petition should the wording be acceptable.

"Oil companies have made the largest profits in their

history at a time when the rest of us are struggling," he said.

"It is putting fishermen out of business, and placing a real

hardship on people especially in rural areas. The system is

just not working.

"It is right that these companies should share their profit

and alleviate the problems they have created.

"The same goes for energy firms. But there are many

practical difficulties to levying a windfall tax on their

profits."