All monopolies conspire against their users. State owned ones also conspire against the taxpayers that own them. As some used to say “We do not own the nationalised industries, they own us” . Any loss or outrage they commit means we have to take the blame and pay the bill.
Monopolies are usually created by law and regulation. Some are said to be natural, but it is difficult to find many of these in large scale provision of goods and services. Of course the owners of the Taj Mahal or the Tower of London have a monopoly of their visitor attraction. The suppliers of water or of electricity or of rail travel need have no such monopoly. In each case it is possible to allow or encourage competition.
State and private monopolies have a tendency to avoid innovation, not wanting to undermine their own way of doing things. They have a tendency to cost plus, allowing their cost base to expand in the knowledge they can pass the costs on to the consumer. They may keep supply tight by not investing in sufficient additional capacity to provide an excuse for high prices and poor service.
State monopolies are particularly good at blaming customers for wanting too much and expecting too good a service. The shortage of roadspace for a growing population in the UK leads to constant demands that we travel less, not to more provision. The shortage of capacity to turn round passport and driving licence applications leads to delays in receipt. Many Councils keep parking dear and scarce to put people off visiting their town centres.
Highly regulated monopolies in the UK are also good at rationing and blaming customers. The water companies, far from wanting to meet expanding demand with more supply, impose limited use bans and try to educate us into using less water. The railways are not good at meeting peak demands with enough trains with enough seats, though the decline in daily commuting has eased this tension somewhat. Big popular events often remain badly served by public transport. The electricity system often needs imports to keep the lights on as it is run with insufficient domestic capacity. Customers are told to cut their use and to switch their use to different times and night and day.
In some pieces to follow I will look at what scope there is to increase competition in regulated monopolies where customers pay for the service and what this might achieve in terms of more capacity, better service and lower prices.
August 13, 2022
Good morning.
With respect Sir John that is a poor example. The reason ? Choice ! I can choose to either go and see and not too them. I cannot choose who supplies my water and takes away my sewage and cleans it.
But that is exactly that Sir John, we have to pay regardless of what service is offered.
I one travelled from London and back on GWR. When the service was poor I simply demanded that they refund a percentage of my ticket. Why cannot we do that with services such as in utilities ? And not just from monopolies like those in the utilities but State ones like Local Councils.
What is happening is that rather than build infrastructure to cope with rising demand through MASS IMMIGRATION, all manner of excuse and the usual blame game are being used. Climate Change for the weather â Gosh who knew it would be hot in the Summer ?!?!?! Profiteering by the suppliers â Gosh how dare they make money ?!?!?! And now the toothless regulator â Gosh lets blame them ?!?!?!
It is like the bins. Before the Ecoloons started we had our bins emptied regularly. The the EU got involved and reduced landfill capacity forcing us to restrict service and separate our waste. Waste we transport elsewhere to be dumped. So the problem is just pushed onto someone else and we pay more for less and all those that can actually do something about just keep quiet and look the other way.
One day the people of this country are going to wake up to the fact that we are being conned and finally do something. Hunger and cold have a way of doing that. Just saying.
August 13, 2022
âState monopolies are particularly good at blaming customers for wanting too much and expecting too good a service.â
President Truman had a sign on his desk with the words âThe buck stops hereâ.
The Conservative government motto now seems to be âNothing to do with me mate!â
August 13, 2022
Exactly. But regulators and fair competition authorities almost always fail to protect the customers. The FCA regulators actually (in effect) gave everyone one size 39% overdrafts.
The shortage of road space is of course a deliberate government policy by using bus/taxi lanes, bike lanes, low traffic zones, 20 mph speed limited & road blocking. Zil lanes to follow soon. Indeed Zil lanes almost here already for those who can afford to waste 40K plus on electric cars or take cabs. Why do Taxis that are far less efficient that self drivel cars (needing professional drivers and often travelling empty ~ 50% of the time get to use bus lanes? Why Black Cabs only and not minicabs?
Why do you have to pay for the NHS, state education or the BBC if you do not choose to use it. We need fare competition between state and private provision and real competition not rigged markets. We have rigged markets in Energy, Transport, Healthcare, Banking, Universities, HousingâŠ
August 14, 2022
yea the FCA, Financial Ombudsman, Pension Ombudsman are all massive failures.
completely and utterly fail to deal with incompetence and fraud in the insurance, pension, and banking systems.
so much so that its day to day occurrence for me to see it, yet none of the state regulators or police are prepared to take on the industry for serious fraud. they are all too busy at their diversity lectures, and taking Wednesday afternoon off “for their mental recovery”.
August 13, 2022
It says ‘The buck’s not here’
August 13, 2022
Nicely put. I rather think the “Don’t Pay, UK” campaign (which I’m NOT supporting) has put the wind up the Government.
They may not be real Conservatives (and certainly not in the Mrs Thatcher mould) but they DO have a collective memory of the Poll Tax refuseniks and subsequent riots.
August 13, 2022
Conned is the right word Mark. Pickles was going to sort out return to weekly bins, like all Tories policies or promises take with a large pinch of salt.
Day by day JR passes the blame from where it belongs, his party and govt. Do not forget level,playing field. His govt used to blame EU now they wonât because it will show the other big lie about Brexitmbeing done when they are still following the EU. Always best to blame a quango.
August 13, 2022
To which you can add the biggest and most wasteful state monopoly of them all… THE NHS
August 13, 2022
It’s unfortunate but not surprising that this rather naive article fails to address, more likely omits, the most important of all issues regarding public sector monopolistic provision. It is an issue that will at some point be used against each and everyone of us no doubt as a weapon of compliance, compulsion and punishment for perceived wrongdoing and transgression of the prevailing progressive narrative. What is that issue? Quite simply, the Marxist-union takeover of public providers as a political power base and as a weapon of indoctrination
From education to health, from Quango to Quango and from roads to rail. All now under the control of Neo-Marxist progressives who will use this control to drive their ideological agenda
I see little point in even having such a debate regarding monopolistic State provision if the most important issue of all isn’t even broached.
It seems the Tory party expects people to work hard, pay their taxes dutifully not knowing that their taxes are being used to finance the construction of Labour aligned Client State whose intent is pleasant. The extreme danger of this can now be seen in the USA. Democratic governance circumvented and separation of powers totally destroyed not unlike the UK
We’ve had a Tory government since 2010. Shameful
August 13, 2022
‘whose intent is unpleasant and indeed dangerous’
August 13, 2022
JR also forgot the banks. So the taxpayer does bail out private enterprise. Level playing field in for EU state aid rules.
August 13, 2022
exactly.
August 13, 2022
Totally agree. I find it contemptible that both candidates are seeking to be populist by talking about âhandoutsâ or âgrantsâ etc to offset the cost of gas/electricity when firstly much is there fault and secondly it is our money.
A typical sign of a left wing government, handing out âsweetsâ to the electorate and expecting it to be grateful.
Everywhere you look, NHS, Education, Rail, as you say Marxist union leaders that our cowardly Ministers of State have given in to.
August 13, 2022
It is a rather naive article, Dom, because it fails to address the problem of regulatory capture. Richard North’s blog is much more informative, with a very good article today on the water shortage crisis. He points out the disastrous effect of the agreement between the water companies and the regulator in 2011. It was agreed that if the companies could show the regulator that it would be more costly to repair a leak than to let it continue, they didn’t have to take action. And sure enough that’s what happened. Instead of tackling leaks properly, the emphasis was placed from then on on ‘nudging’ us consumers into using less water.
Perhaps Sir John has in mind taking a look, in one of the upcoming pieces he announces, at improving the effectiveness of the water regulator. Since the creation of regulatory bodies is a state monopoly, it surely deserves his critical attention.
August 13, 2022
I commented just the other day about how reprehensible Ofwat were, and this is further confirmation of that. It is unacceptable to have ANY leaks. And it would cost the government NOTHING to solve this problem: simply deny companies the ability to pay dividends to their shareholders until ALL their leaks are fixed. The companies will whinge and the shareholders – mostly foreigners, who own over 70% of the shares in England’s nine privatised water companies – will be unhappy, but the BRITISH VOTERS will be delighted, and they are the ones that should matter. Unfortunately, with the Conservative TRAITORS in charge, it seems they are not and foreigners matter more.
August 13, 2022
It sounds good. Unfortunately the water companies wouldn’t stay around, X-Tory, because after decades of neglect repair costs would probably now be astronomical. So they couldn’t make a profit on the business, and they’d pull out, to invest their capital elsewhere.
It’s called private enterprise.
August 14, 2022
How much are you prepared to pay to achieve zero leaks? Say ÂŁ4,000 a year?
We need a proper reappraisal of what we should be doing about water, starting with removing the EU Water Directives from our laws.
August 13, 2022
My council is building even more cycle lanes that no one uses rather than fixing the pot holes on roads that everyone usesâŠ.crazy use of taxpayer money
But it does get a tick in the box for the green revolution at the UN
August 13, 2022
+1
August 13, 2022
Taking the one that ‘runs’ between Winnersh Triangle and near Shinfield it serves joggers, walkers, but a cyclist is very rare.
August 13, 2022
@DOM; Err, we have not had a Tory government since 1964, in my opinion. Shameful!
August 13, 2022
Today at noon windmills ate producing 0.58gw, surely a re ord. Now examine how all the energy companies are supplying us with 100% renewable energy.
Maybe the energy cap should be lifted and some real competition be available from the suppliers.
How about a rebate for the percentage of non renewable being sold to us.
August 13, 2022
Its basic stuff and this government(s) keeps getting it wrong
August 13, 2022
âBig popular events often remain badly served by public transport.â
Today the Premier League match between Brentford and Manchester United has no trains whatsoever passing through the station right next to the ground as there are engineering works on the line! Great planning.
In the days when rail was one big integrated public service engineering work took place at night. Since privatisation it was decided that running bus replacement services was a money saving wheeze. So this is routinely done. The inconvenience to the general public on weekends and at Christmas and Easter is of no concern.
August 13, 2022
Not that much of a problem compared to the much larger grounds. The Community stadium capacity is 17,000 so a small number of Man Utd fans are inconvenienced getting there. Now consider the bigger grounds holding 60,000 with a much larger travelling attendance, indeed home fans often travel long distances.
August 13, 2022
Poor planning of maintenance work is often a problem, but a much bigger one at the moment is all the rail strikes taking place – and the London tube is set to join in too, wreaking havoc to businesses and tourism in our capital city. Some political problems are difficult and expensive to solve and take a long time. This one, on the other hand, could be solved very easily, merely take a few weeks and cost NOTHING. Not a penny. All the government needs to do is pass a very short, one pargraph Bill, stating that strikes by public transport workers are unlawful. That’s it. It could pass through parliament and become law very quickly and would solve the problems completely. It would be very popular with Conservative voters, would help maintain economic output and would cost nothing. It is so obvious that you have to wonder why Liz and Rishi are so STUPID that they have not proposed this. I dismiss the moron Boris Johnson as I expect nothing from that traitor anyway. But if Liz and Rishi cannot grasp this nettle now they never will, and I will view them both with the contempt they deserve. Public transport is an ESSENTIAL SERVICE and ALL strikes must be completely BANNED.
August 13, 2022
@Peter; Indeed, and let’s remember both the pre 1948 railway companies and BR that followed all served the public far better in those days, because the industry had far tighter regulation, and in the case of BR a network wide loyalty, it did not matter what train you traveled on (with one exception, Pullman trains), just so long as it was via a ‘reasonable’ route, unlike since privatization.
That said, I would argue in defense of NR and the TOC over engineering works, not every set of works can be scheduled for a 12 hour route shutdown, even if 12 hours is enough time for the work in hand it also has to be scheduled in with other work, people and equipment can not be in two places at the same time. These works are often planned months, perhaps even years, in advance and I’m sure NR would be happy to advise bodies such as the FA so, if needs-must, better arrangements can be made to what is usually a more flexible sporting schedule [said in jest]. đ
Weekends and bank holidays have always been the preferred periods for such engineering work though out the history of the railways, what has changed perhaps are H&S requirements. Total occupation of sections of line and thus complete closure is now the norm I believe, where in the past “single line running” might have been implemented keep the route at least partially open; and then of course public expectations have changed, believing the spin of better service from the railways post privatization -that was never going to happen, such is the nature of the railway industry. Many of the problems blamed on BR existed before WW2, before WW1, and still exist today. A Leopard is born a Leopard, it can never become a Tiger, even less a nice cuddly domestic cat…
August 13, 2022
True enough, Jerry.
Heavy trains need to be laid up nearby with ballast and complex pre-manufactured points laid at an angle on them. Then there need to be cranes and tampers ready to come in – the engineering gangs, engineers and technicians ready on site to do work with military precision. Before all this happens a block of the line needs to be established and in many cases Single Line Working set up around the possession for night trains to pass.
The whole lot has to be rewired to the control system and signalling, re-tested and certified and the block taken down again – all of this done in six hours to class as an overnight job ready for the morning start.
Often done in gross weather conditions.
August 13, 2022
PS. Pre Beeching there were far more diversionary routes to keep services running.
August 13, 2022
The private monopolists are the Tories’ friends, however.
That is exactly why they were handed those monopolies by Tories from Thatcher’s governments onwards.
What’s good for the people has no bearing on those considerations.
August 13, 2022
There is certainly some truth in this and the regulators fail often becoming far too much on the side of the monopoly. Even with people money to work for the companies.
August 13, 2022
Yes.
August 13, 2022
Are you referring to the millions of people who bought shares in those companies NHL?
August 13, 2022
How quickly did these millions of people sell their shares after making a quick buck, shares thereafter eagerly bought by foreign-owned companies?
Give us the full story, please P2.
August 13, 2022
Well thats their choice, isn’t it?
August 14, 2022
At least the disaster of nationalisation ended heffy.
So some sold their shares…would you stop that too?
Others then bought them.
Pension funds as well as other individuals.
You are so negative at the moment.
August 13, 2022
I say I should have received free shares, reflecting my share of what was a publicly owned utility.
August 14, 2022
Well they were offered at very good prices so count your blessings Dave.
August 13, 2022
I think he is. The little people who bought the shares couldn’t wait to sell them off as soon as the price went up; like regular Stag traders. The result was the little people made a few Pounds; but, the big fund managers hoovered up those shares, knowing the government had issued them heavily discounted, to promote the peoples capitalism.
August 14, 2022
Some sold but many kept those shares and added to them.
But you want just the state to be in charge not the little man as you so disparagingly call us.
August 13, 2022
A lot of the energy crisis is down to the Tory failure to sign off new power stations, extraction and to allow the closure of gas storage.
They’ve had 12 years in office. More than long enough to have sorted this obvious problem out. Instead they caved to the green zealots – as they have the shoplifters, the cannabis smokers, the people smugglers and the burglars.
August 13, 2022
Agree – nothing has changed in those 12 years….apart from the new paradigm of net-zero…what a waste
August 13, 2022
Your title explains why we have such a crap water / sewage industry and no national water grid.
When war breaks out as in WW2 I assume there is legislation in place to enable government to act without recourse to Parliament and its inevitable delays. If so this is what our next PM needs to reach for to sort out our myriad problems from day one. A declaration of national emergency not subject to the interference of civil servants, lawyers on the make and nimbies.
August 13, 2022
The largest and worst State Monopoly in the UK is Parliament, both Chambers.
The members of that State Monopoly have, over the past 20 years or so, deliberately created an energy crisis and they are now telling the people they will have to pay astronomic sums of money for an essential service. Swift action is needed to prevent a catastrophe this winter but at the moment we have no Government to speak of, since the governing party is indulging in a protracted leadership campaign. We also have no Opposition to speak of since the so-called Leader of the Opposition is Missing in Action (and has nothing to say even when he IS present).
That is a situation which could only arise because the two Parties involved are insulated and protected from the wrath of the voters, just like the other State Monopolies. Whoever we vote for, we get the Uni-Party and the same policies rammed down our throats. And any genuine opposition to the Uni-Party is kept well away from the levers of power by the Party and electoral system – and, as far as they’re now possible, silenced by the legacy MSM.
Until we get genuine competition of ideas represented in Parliament and the ability to implement radical solutions (which will mean dealing with the left-wing Senior Civil Service), nothing will change in the other State Monopolies.
Sir John could make a start by advocating abolition or at the very least major reform of the House of Frauds. But he won’t.
It’s all the fault of the Quangos don’cha know.
August 13, 2022
“Competition is the customers friend” indeed it is, but not when it is rigged by the Government and controlled with subsidies, taxation, quota’s, and whole load of incomprehensible rules and regulations, dictated by a quango organisation and designed for political policy purposes.
Business is simple really, it’s governments which make it complicated !
August 13, 2022
Construction of a huge electric car battery factory that has attracted tens of millions of pounds of taxpayer cash and been hailed as a flagship project of Boris Johnsonâs levelling up policy has been put on âlife supportâ to cut spending, leaked internal documents suggest.
Work on Britishvoltâs 95-hectare site near Blyth in Northumberland has been severely limited until February to minimise spending as it focuses on unlocking its next round of funding and critical power supply infrastructure, the documents suggest.
https://notalotofpeopleknowthat.wordpress.com/
August 13, 2022
Isnât it up to govts to prevent monopolies?
I thought there used to be laws against the take-overs which create them.
What happened to the Competition Act?
One thing we do know however is that NOTHING has EVER been done in the interest of the English people.
How many purveyors of food do we have now? Four? Horrible woke supermarkets that have the cheek to try to control our lives. And other suppliers a rarity ( here, anyway).
Government attack dogs?
August 13, 2022
A decent government would do something to protect us from hateful local councils.
Curb their powers. Stop paying a Chief Executive salary to the Town Clerk.
Talk about monopolies.
Local councils think they own us lock, stock and barrel and can inflict anything they choose on us.
A few outright falsehoods before the election and then power unlimitedâŠ.
August 13, 2022
And get back to work. Apparently 50% – 90% are still working from home and many can’t do their jobs properly because they don’t have the usual aids to hand. We are paying their wages and it is a PUBLIC service. Get back to your desk or get sacked.
August 13, 2022
The article seems to suggest a very comforting interpretation of our present situation.
Not Marxist unions holding up passports and driving licenses?
Not globalist diktats making parking a nightmare?
Not an overarching strategy to ruin our lives?
Not a govt that hates us to pieces and wants to destroy our businesses and swamp and replace us?
If only I could believe all that I might actually sleep again!
August 13, 2022
There can be no competition in water supply. There’s only one set of reservoirs, one set of supply pipes, one set of sewage system and one set of sewage treatment plants. You can’t have parallel systems.
Both state and privately owned monopolies have similar problems. Neither wants to invest, neither motivate their workforce and neither wish to keep consumer bills down.
What is needed is for the users to be the owners of the service. Then everyone gets the service they wish to pay for. The snag is such a system would need an effective group of non-execs to represent the consumer; the most suitable people would be already too busy.
August 15, 2022
You can have competition between different teams of leak fixers. Might well serve to introduce better techniques. Competition between fixing leaks and replacing pipes, again with different techniques. Competition in how to treat water effectively. Competition between sources of supply, especially if you permit pipelines to cross to different regions. Competition to provide measurement of water resource. Competition to install metering and information systems monitoring mains. Competition in dealing with fatburgers.
August 13, 2022
What is the explanation for a soft, lefty Tory govtâs love of a huge monopolistic client state?
Why does it actively encourage people to not work? They do not have to compete. They just stretch out their hands.
What will it do when claimants outnumber workers?
Will it leave those workers to freeze and starve this winter when the beneficiaries laze in their hot tubs gulping down crĂšme de menthe cocktails and ânibblesâ and laughing at their suffering neighbours?
August 13, 2022
+100
August 13, 2022
People who need to drink water (all of us) are NOT customers. Ditto those who need to keep ourselves warm (all of us.)
Even if no-one were selling water or material to burn we would be forced to find it for free. People would even fight for it. The same for basic foods.
These are things which should not be provided at the whims of the market.
Clearly competition is failing in water and fuel, therefore competition is not the way to provide it.
Not a single new reservoir in thirty years despite there being an obvious policy of increasing the population.
What is Government and Parliament for ? It has abrogated so much responsibility to quangos that it is useless.
THERE are where the taxpayer savings can be made.
(Why is VAT not considered to be inflationary ? When is it going to be cut ?)
August 13, 2022
Water privatisation in 1989 was supposed to unleash a rush of private capital to invest in new infrastructure.
Instead, water companies have drawn off ÂŁ72billion of dividends while sweating the assets they inherited from an age when Britain took water supply a lot more seriously.
August 13, 2022
That new investment was suppose to fix all the countries leaks within a decade….that was the jusification for a huge price rise upon privatisation 1989…didn’t happen, they took the money and ran
August 13, 2022
I understood a lot was paid in dividends which went to EU owners?
August 13, 2022
“All monopolies conspire against their users.”
Indeed, and that includes capitalist cartel like behavior…
“State owned ones also conspire against the taxpayers that own them.”
How do they do that, unless you mean they socialize debt, but then so do the ‘to big to fail’ capitalists companies who end up receiving taxpayer handouts! đ
“State and private monopolies have a tendency to avoid innovation”
Not at all, the problems do not come from the ownership model per se, for example the GPO had a video phone system, all but ready to rollout back in the very late 1960s, it was their political masters in Whitehall who thwarted that innovation, just as politics later thwarted innovations such as Concorde. On the other hand unnecessary over or under regulation by Whitehall, or partisan politicos, also thwart free-market innovation and/or competition, just as it did with satellite TV (until the advent of Freesat) for example, and those consumers are still treated as fools and cash-cows to this very day, having to subscribe to 500 channels they do not want before being allowed to subscribe to the one(s) they do, the same problem as with the TVL fee that politics refuse to sort out! Both the BBC and BSkyB have been very innovative through out their effective monopolies here in the UK. As I say, such failings are not of the market per se but with Whitehall.
Any company owned by its shareholders has to, by law, maximize their profits and thus dividends, indeed if the board find they are under preforming they are legally bound to issue a profits warning. Thus all such competition does is create a race to the top, to whatever the maximum is the market will stand [1], not keep prices to the minimum necessary for re-investment and renewal as is the case with not-for-profit or nationalised entities. Yes companies operated on a mutual bases might also pay out dividends or more likely rewards, but often the payouts are low, or in the form of further discounted prices.
[1] that in its self is not a problem were the product is of a discretionary nature, after all the man or woman on the Clapham Omnibus can choose whether to buy a new washing machine or pay a subscription, the problems come were the product is non discretionary, such as food, energy and these days decent, affordable, IP conductivity.
August 13, 2022
All true, and it is to be hoped there will be radical moves to break these monopolies by the next PM.
But youâve missed out the elephant in the room – the most egregious example of bad monopoly service of all – the NHS. At some point that one will also need to be addressed. A first step would be to say that anyone who canât get a needed medical procedure or appointment after some specified reasonable max period gets funded to go private, either in the U.K. or abroad. A sensible measure also would be to say that anyone who takes pressure off the NHS by paying for themselves can set the expense against tax. Otherwise itâs just going to get worse and worse.
August 14, 2022
give buying power to patients, let them take their cheque from the state backed health insurance anywhere they like at any point of the treatment cycle. let poor providers of care go bust and fail and shut.
August 13, 2022
One step back from the monopoly though is the practice of charging irrespective of usage.
The poll tax came into this category. You could live like a hermit in a hole with no demands on society and pay the same as your neighbour in a large house with 7 kids using every local service provided.
This “standing charge” malarkey strikes me as being similar. We’re paying for an infrastructure which is already in place and regardless of usage. Rather like paying a charge to Tesco or Sainsburys just because it’s there, regardless of how much you spend on groceries.
It now appears we’re paying standing charges to cover competitors who have gone bust. I can’t imagine paying Tesco a discrete premium to cover the fact that a competitor went to the wall.
So this is government inspired rip-offery which at its extreme entails our income being consumed by law into numerous utility and other bank accounts to cover goods and services we do or don’t use.
August 13, 2022
Sir Joe Soap : âThis âstanding chargeâ malarkey strikes me as being similar. Weâre paying for an infrastructure which is already in place and regardless of usage.â
This is not the case for electricity as we must pay for the enormous capacity increases necessary for the National Grid â both national and local capacities.
For instance, the National Grid has just announced plans to spend ÂŁ54 billion to transport power from all the wind farms around the UK. This amounts to ÂŁ2000 per household and does not include all the local additional expense that will be required as a result of the electrification of heating (heat pumps) and transport (evs).
Interestingly the amount power that will be required for domestic heat pumps and vehicles by 2050 far exceeds the amount BEIS are planning to provideâŠ.despite a planned increase in population of 10 millionâŠ.
August 13, 2022
The Civil Service is the most important monopoly that needs competition as it works against both the democratic demands of customers and the government too. Brexit being the last straw.
Interesting DT article on the too Civil servant today, especially the comments offering solutions like Accountability which keeps the private sector in line.
August 13, 2022
Top not too
August 13, 2022
It is unfortunate but competition really only works where you have multiple sources from whom you can buy the same service, as in the retail sector. This cannot be the case with most utilities and the railways where the only way of measuring performance and pricing is between one monopoly supplier and another.
Regulators are invariably too soft on their charges, otherwise why do we still have so many drastic leaks in our water system ?
As far as government service is concerned, rarely are the top people genuinely held to account. When they underperform, they are simply moved to another job, probably with a promotion and pay rise, where they will probably fail again !
August 13, 2022
Or moved to the House of Lords where they can collect ÂŁ350 a day for turning up for 10 minutes. As half of them live in London, it is no inconvenience to pop in when on the way to an afternoon drinking session with a crony.
August 13, 2022
Ooh, I’ve just read that the average payment to the Lords is just over ÂŁ30k a year TAX FREE and the House only sits for half the year. And, of course, those outside London get generous expenses. Cost of living crisis. What bloody crisis?
August 13, 2022
Sir John would you recommend me to PM Johnson, who it seems is about to nominate 30 new Peers?
I quite fancy the idea, having always been a fan of his….(well maybe not a fan exactly).
August 13, 2022
Get in the queue
August 13, 2022
Good article in the telegraph by Paul Goodman. Neither truss nor sunak are saying anything about public spending, the root cause of all our current economic troubles. After all if we cut it by 10% we could have all the tax cuts we want, plus some sensible investment, better defence etc. but thereâs been no mention of all the dreadful waste. The useless defence procurement, the 20% increase in the number of civil servants, HS2, the myriad of useless interfering bossy quangos, the public sector pensions, the black hole of the NHS where over 50% of employees are non-clinical.
Quite difficult to get much enthusiasm for Ms Truss while she – and her prominent supporters – simply dodge this question.
August 13, 2022
Competition isnât competition if you need government subsidy
August 13, 2022
Sadly, “Competition is the customersâ friend”, but not the voters friend. Free market competition doesn’t apply when we elect a new Conservative Prime Minister. The Party system selects who we will be allowed to vote for at General Elections; a local independent candidate has little chance in this voter pre-conditioned, dominant binary system. Now 0.0008% of registered voters selects binary candidates for another 0.4% of voters to elect as PM.
Having now left the EU, the UK is left being operated by the tier of management below the upper tier that actually knew what it was doing. I will never see it but I dream that one day we will have “nonpartisan blanket primary elections”. A primary election in which all candidates for the same elected office run against each other at once, regardless of the political party. The top two go on to the General Election.
August 13, 2022
We don’t elect Presidents in the UK acorn
You vote at general elections for your local MP
Surely you know all this acorn?
August 14, 2022
Ahead at prat factor nine today toxic negative peter2
August 14, 2022
How all you lefties on here descend to childish abuse once your cliché arguments are challenged.
At least we dont get more of your partial dodgy statistics in this hilarious post from you acorn.
No rebuttal to my comment I note.
August 14, 2022
I also would ask people like acorn and others, who post such posts to ask themselves in this politically correct age….would you talk to people you disagree with in an identical manner, ace to face or at work setting or in a social setting.
You keyboard warriors on here please feel free to comment.
August 13, 2022
It appears according to the water company man who visited my property yesterday about poor pressure supply in the street, the only thing that is paramount in the minds of the company is not to incur the wrath of OFWAT and be fined. That is why their distribution networks are operated at the lowest standing pressures possible to stop the leakage rates, but just enough to keep it above the allowed minimum.
All well and fine but more more properties now rely on mains pressure systems be it combi boilers, heat stores or high pressure cylinders. Gone are the days when properties had 75 gallon cold water storage cisterns in the roof space to supply hot and cold down water services and the only mains pressure tap was at the sink to be used for potable services.
So it appears the only real concerns is to the directors and the share holders.
When asked is it right bonuses should be paid to staff when raw sewerage is dumped into rivers and seas the reply was “no comment way above my pay grade” Company driven by fear? He shrugged his shoulders and left.
Says it all really
August 13, 2022
The other day a chap knocked on my door to advise me that the following evening, during the night, there would be a couple of vans parked outside my house from midnight onwards. He explained that in the pavement outside my house there was a meter that automatically reported how much water was going through – this is not a meter for anyone’s house, but just monitors what is going through the main out in the street. Wessex Water had noticed that this meter was reporting high usage at night and they were about to investigate. A few days later, down the road, the road was dug up and the leak repaired. Pretty damn impressive in my opinion.
August 13, 2022
about as rare as Hen’s teeth?
August 13, 2022
Excellent blog by John Redwood, capturing much of the economic essence of real Conservatism and a message most ‘Conservatives’ have failed to comprehend, let alone communicate to the general public.
There is also a big difference between public funding of essential services from competitive private providers and public (monopoly) operation of an essential service such as hospitals.
For a start this blog should be sent to every Conservative M.P. and also all Conservative Councillors most of whom (especially if they become Council portfolio holders or Committee chairmen) are fervent defenders of Council supplied ‘services’ and monopolies.
August 13, 2022
And it is as far apart from what his government actually does as I am to being a Tory.
August 13, 2022
âOwning a car is outdated â20th-century thinkingâ and we must move to âshared mobilityâ to cut carbon emissionsâ, says transport minister, Trudy Harrison.
The communist fifth column in Parliament, the civil service and numerous quangos are determined that we will be under the thumb of the transport unions through the implementation of their Net Zero Strategy which plans for the replacement of ices by âactive travelâ and public transport.
As well as expensive to purchase, evs will suffer from Insufficient, expensive and intermittent electrical energy, long and frequent charging times and consequently are likely to be mainly owned by those who own houses with driveways. But even for these owners, there is the danger that the National Grid will extract the energy from their ev batteries to stabilise/balance the grid overnight if the wind stops blowing. So by the morning they may find they have no battery energy and will be forced to use âactive travelâ or public transport themselvesâŠ.or simply stay at homeâŠ
August 13, 2022
Trudy Harrison was elected as MP for Copeland, which basically corresponds to Cumbria and the Lake District. I wonder how her rural and suburban constituents feel about her suggestion they should give up owning a car.
August 13, 2022
Bill. I can tell you that in rural Shropshire public transport is dire. A car is an absolute necessity. Shrewsbury is the capital city of Shropshire and I live 9 miles outside of it. There are no buses after 18.15 either in or out of the city and no spare taxis making it difficult to meet up after work or go for a night in the city unless someone can pick you up. In the recent awards of funding for transport Worthing, which has an excellent bus service received millions but Shropshire got a big fat zero. Who makes these bloody stupid decisions?
August 13, 2022
The depreciation of the battery from the energy cycle is more than the value of the electricity supplied.
August 13, 2022
Of all the services and utilities I use Iâm happiest with my water supplier. They provide a cheap and good service. I only pay ÂŁ26 per month. When I need to contact them they answer the phone within seconds. They keep me informed of any work they are carrying out in my area. I wouldnât have sold off the water companies as they have a monopoly but I have no gripes about the price and service mine provides. My main concern is the government continually increasing the UK’s population which must put a strain on existing resources and this, in turn, means the cost of these new residents is passed on to those of us who already live here. Infrastructure costs are never factored into the high price we pay for importing workers. We need to become more efficient with the people who already live here and utilise technology better. Allowing companies to import workers at our expense is just not fair. Government should revisit their woeful points system to reflect the real costs incurred.
August 13, 2022
Christine, just to be sure: you have a water meter and pay your real consumption, and not the default payment that water companies set up simply based on the size of your house (Council Tax band).
August 13, 2022
Yes, I have a water meter. I try not to waste water. I never use a hose pipe. I collect rainwater in large water butts for the garden. I never leave a tap running unnecessarily. I only run the dishwasher when it’s full. I only do a clothes wash when I have a full load. There are only two of us living here but even so, I think my water supply is good value for money. Certainly better than the rest of my bills.
August 13, 2022
I look forward to your further comments Sir…
Utilities should, as part of their mandate, (from HMG–>Regulator) ensure timely long term capital investments to replace ageing, end of life, infrastructure, plus right time capacity uplifts based on population forecasts/outurns and environment factors (integrated planning). Do we see that? Er No…
One day the people of this country are going to wake up to the fact that we are being conned and finally do something. Hunger and cold have a way of doing that. Just saying.
August 13, 2022
Unless the competitor to local manufacturing is a foreign “enterprise” which has state subsidy and support in their protected market in which case the customer, their friends and family will eventually lose their jobs and future prosperity.
So while fair competition is likely the customers friend if the true cost is charged and appreciated but not otherwise – unilateral free market is akin to cutting your own throat slowly.
August 13, 2022
Apologies for going off-topic but I have just read the shocking news that the amount of arable land in the UK which is used for growing crops which are NOT used for food but simply end up as part of our petrol and diesel is sufficient to feed 3.5 MILLION people. The use of the idiotic E10 petrol which contains 10% biofuels means that we need to use around 270,000 acres to grow the wheat, rape and sugar beet which are used to produce this bioethanol additive. The irony is that E10 was introduced to reduce fossil fuel consumption in order to meet our moronic net zero target, but it doesn’t even achieve this limited (and pointless) goal.
E10 was rolled out a year ago – on 1 Septamber 2021 – under the idiotic Boris government. Conservatives have only themselves to blame. How many MPs voted against this? Before E10 we had E5, which was made up of 5% bioethanol. This was introduced on 1 September 2019 (yes, that’s right, also under the traitor Boris Johnson!) and was already very stupid, but if Liz Truss went back to that it would at least be a start and would free up huge tracts of land to produce edible crops and cut food prices. Better still, of course, would be to eliminate ALL bioethanol production and just go back to normal petrol and diesel. This would help in the fight against inflation and the cost of living and help cut our imports too. How about it Sir John – will you propose this to your annointed one?
August 13, 2022
Plus the reduced MPG which means buying more petrol and paying MORE VAT.
That’s what it’s really about.
August 13, 2022
nonsense.
August 13, 2022
http://www.esru.strath.ac.uk
The principle fuel used as a petrol substitute for road transport vehicles is bioethanol. Bioethanol fuel is mainly produced by the sugar fermentation process, although it can also be manufactured by the chemical process of reacting ethylene with steam. The main sources of sugar required to produce ethanol come from fuel or energy crops. These crops are grown specifically for energy use and include corn, maize and wheat crops, waste straw, willow and popular trees, sawdust, reed canary grass, cord grasses, jerusalem artichoke, myscanthus and sorghum plants. There is also ongoing research and development into the use of municipal solid wastes to produce ethanol fuel. Ethanol or ethyl alcohol (C2H5OH) is a clear colourless liquid, it is biodegradable, low in toxicity and causes little environmental pollution if spilt. Ethanol burns to produce carbon dioxide and water. Ethanol is a high octane fuel and has replaced lead as an octane enhancer in petrol. By blending ethanol with gasoline we can also oxygenate the fuel mixture so it burns more completely and reduces polluting emissions. Ethanol fuel blends are widely sold in the United States. The most common blend is 10% ethanol and 90% petrol (E10). Vehicle engines require no modifications to run on E10 and vehicle warranties are unaffected.
August 13, 2022
This is how the Arab Spring started.
Google it đ
August 13, 2022
I think your title is a sweeping statement. Some types of competition are the customers friend perhaps is a better premise.
August 13, 2022
margaret, +1. Todayâs title is from an ideologue.
August 13, 2022
A few days ago, Sir John, you wrote of Tory members’ — and by inference the country’s — being hungry for change, which I’m sure they are.
The first and most obvious change a new pry minis’er needs to make is getting rid of the idiots that came up with the process of choosing a new one that takes TWO MONTHS, f.C.s. — something the average voter could likely accomplish on the back of an envelope in two minutes!
Î Î
August 13, 2022
1. Distraction technique …. party and media talking constantly about the “leadership competition” and not other, real, news
2. Gives them a couple of months to plan how they are going to tackle the mess the Johnson Government has made of everything
3. New PM / new policy announcements at the party conference ….. overshadowing Labour
August 14, 2022
âDistraction techniqueâ: Truss is not even defining a coherent program, she now piles up with anti-woke, anti-anti-semitism, so that the oldies (but rarely goldies) among the Conservative Party members, who would have difficulties in defining what âwokeâ really is will blindly vote for her.
Her plan is to get 2.5% GDP growth from tax cuts, cutting regulations, helping a supply-side reform, revisiting the BoE mandate. One can wonder how/why the Conservative Party Governments in power in the last 12 years have not been able to provide any of these, despite moving corporation tax rate from 26 to 19% without any tangible results. The hard-right wing of the Tory party that Truss is cajoling will now show us what they can do. Donât expect too much given that their premises for action is only looking backwards 40 years.
August 14, 2022
Ah the hard right cliché again from our resident lefty.
Blindly voting…never applied to parties on the left that hefner likes
Presumably he thinks they all vote with political correctness and eyes wide open.
August 13, 2022
What about 50% ownership for businesses and consumers of energy companies where ten per cent of the whole bill
go towards the 50% stake in their businesses, a buy-out over time with government subsidize going to energy companies going towards the buy-out.
August 13, 2022
Thames Water have been trying to build a huge reservoir near Abingdon in Oxfordshire since around 2006. Huge objections. It would increase supply for London and south east generally. The NHS in the same region is short of staff and wants to recruit overseas as do many small employers faced with a labour shortage. Solution?
August 13, 2022
Build it somewhere else. Surely Abingdon isn’t the only possible location.
August 13, 2022
the applications get refused every time. Near Oxford, near Wantage..
August 13, 2022
Refused by…?
And why not well away from settlements in Oxfordshire?
I don’t have any specialist knowledge – I just ask in the hope someone will know.
August 13, 2022
Local Councils and on appeal…
Those as I recall were indeed miles from ‘settlements’.
August 13, 2022
But by the way, when the Thames as an example, is brimfull and causing big issues downstream, wouldn’t it be rather good to take surplus water off into upstream reservoirs?
August 14, 2022
Indeed where is the surplus supply? or storage reserves! Strategic Water reserves, Energy etc
Strategic fail or incompetence to the level of Treason by a 5th column?
August 13, 2022
Are any water companies wholly owned by UK shareholders? How many have been sold off by the Tories who haven’t cared about our sovereignty for decades. All they wanted was foreign money so they didn’t have to put in policies to improve our trading position. In other words all they cared about was short termism with their City spiv friends. Now all profit and cash goes overseas to the foreign owners.
August 13, 2022
I believe someone here mentioned the Scottish water companies are still state owned.
August 13, 2022
Mark. Yes they are and included in the council tax which is a hell of a lot cheaper than it is in England. What’s new?
August 13, 2022
Dear Sir John, please forgive me saying that I sincerely hope that your influence over the incoming government will not extend to this area.
As a default, competition or even the threat of petition is good. But if you artificially inject competition into a natural monopoly by divorcing the selling of the service from its production, the result is often bad for consumers in anything but the very short term.
As a severe critic of Network Rail, you should understand this. Rail privatisation was based on just this attempt to create competition at all levels: franchised services, new services, train ownership, maintenance and so on. The result was hardly any competition but loads of perverse incentives, lack of responsibility and general chaos.
How much better it would have been to privatise each of the definable networks, perhaps 8 -10 rather than the old 4, and subject them to regulation of service , cost efficiency, performance and fairness. .
This could be achieved realistically by comparing the performance of these companies, and imposing best practice on the laggards. This is called “comparative competition” and is exactly the system used for water and for sewerage, (which makes up most of the bills).
Please explain what the market incentive would be for anyone to build a new reservoir that would be surplus to requirements for 99 per cent of time if they were not allowed to recoup the increased capital cost through the price of water. (Incidentally, the likelihood of even 90 per cent of pre-2000 properties being metered is about the same as 90 per cent being fully insulated).
Electricity is sold through a highly competitive wholesale market devised largely by Enron for the Blair government. The result is that generators (including the Government of France) have a strong incentive to keep the market short. The National Grid has responsibility for ensuring we have sufficient supply but it has no power to create extra supply. And consumers have no contract with the owners of the local infrastructure, so that there is no market incentive to improve and upgrade it. So yet more regulation and government levies are required to deal with newly and needlessly created market failures.
The world is not textbook perfect. Please do not let ideology triumph over practical economics.
Reply You mis read my proposals. I opposed the rail split and recommended cos that owned track and trains.I wanted route contestability as with the successful Hull co. for water I want new cos to be able to develop new reservoirs or boreholes to compete against the monopolists and to allow the regional water cos to compete in each other’s areas using the pipes as a common carrier.
August 15, 2022
I think Enron were bankrupt long before the present electricity market arrangements were concocted. CFDs were only put forward a decade ago, and ROCs and priority rights for renewables go back to about 2005 IIRC.
August 13, 2022
There is no competition at all when it comes to implementing Net Zero.
We are told we must accept wind and solar power and the electrification of heating and transport. There is no other option.
As a result we are going to have insufficient, expensive and intermittent energy (viz volatile/high prices and rolling backouts) and suffer ineffective heating and limp around in poorly performing and expensive evs.
To make matters even more serious we will have no energy security as 95% of wind turbines and 100% of solar panels are built by China using guess what – coal power â and batteries, or at least the raw materials, will be in the control of China.
BEIS/Parliament should legislate for competition by allowing to exist any technology which complies with the net zero CO2 emissions requirement.
For instance, the market should be offered green methane/natural gas (biogas) to power existing home boilers and all existing ic engines with modification instead of the forced take up of heat pumps and evs..
August 15, 2022
What I find absurd us that not only has government already decided on the disaster it wants to ilement, it has taken the advice of National Grid as the custodians of the Future Energy Scenarios, whose interest is to dream of solutions that require the most grid assets to implement.
Now it is seeking to impose new trading arrangements that will make existing contracts redundant but ensure that their system is adequately subsidised in rigged markets. No wonder there is little concern about lowballing CFD bids that will be bailed out, or about how costly the system will be in practice, nor how vulnerable it will be to supply failures.
August 13, 2022
Interesting, Sir John.
You are obviously correct that competition is the customers friend.
On Independence Daily, someone has just asked – ‘Why are British Passports printed in France?’
Is it perhaps that our printing industry is one of those stolen from us by the EU?
August 14, 2022
Probably a consequence of our Establishment’s “expensive energy” policy.
French electricity – nuclear, not windmill powered, is far cheaper.
August 14, 2022
British passports are made by a company in the Franco-Dutch Thales Group but all relevant holderâs information is printed in the UK. No personal data (details and photograph) is supposed to leave the UK, dixit the Home Office (factcheckni.org, 09/03/2021 âAre UK passports produced by non-UK companies?â
August 13, 2022
In a recent thread I commented that having a debt of 2 million, million pounds meant we could not be a ‘rich country’. Mr. Redwood’s reply was that we owe a large proportion of that money to ourselves and I should try living in N.Korea or Venezuela. Notwithstanding the sheer Orwellian nature of the ‘we owe the money to ourselves’ comment {if that is in any sane sense true, why don’t we simply tell ourselves we don’t have to pay it back and forget about it?), I see in the Daily Express today (on the web site, I don’t buy the paper):
This is from Ben Harris-Quinney – chairman of The Bow Group, the world’s oldest conservative think tank. Mr. Redwood, is he wrong?
August 13, 2022
The importing of wood to burn in Drax power station âis not sustainableâ and âdoesnât make any senseâ, the business and energy secretary, Kwasi Kwarteng, told a private meeting of MPs this week.
The remarks are significant as the burning of biomass to produce energy is an important part of the UK governmentâs net zero strategy and has received ÂŁ5.6bn in subsidies from energy bill payers over the last decade
https://notalotofpeopleknowthat.wordpress.com/
August 13, 2022
wow – somebody talking common sense.
August 13, 2022
I find it comical that the Water Companies are accused of lack of investment and failure to build reservoirs. How on earth could they get planning permission for a reservoir these days? If we had a government, they would sit down with the energy companies, agree a 30 to 50 year plan and simply tell local authorities where the new reservoirs are going. And, if they had any sense (oh boy) they’d surround the reservoir with wind turbines and, when wind conditions are favourable, part empty the reservoir to generate hydro electricity and then pump the water back in.
Mind you, that’s ‘if we had a government’.
August 13, 2022
So, if they don’t work, it is the fault of whoever drafted the laws and regulations.
Goods, yes. Services, no. There is no meaningful way in which a company can compete with Wessex Water to supply the water I consume. As it happens, my experiences with Wessex Water have been very positive. I have had several dealings with them since I moved here 3 years ago. Most recently, I reported a collapsed manhole cover outside my house which I assumed belonged to them. I telephoned and, blow me, someone answered the phone. This was at 4 pm. 3 hours later a chap arrived to have a look.
As for electricity. I tell So Energy I want my electricity from wind, please. In what way is there any connection between energy from the wind turbines across our land and sea and my house. Is the electricity carefully segregated as it passes through the National Grid and then up the cables to my house?
Water and electricity – no. Rail? Hardly. The railway infrastructure – including signalling – is by definition a monopoly. Left to the market, a couple of competing companies might run services in the rush hour. The rest of the time the lines would be unused. And, even then, they can’t both run trains on the same line at the same time. I mean, really, what is the bloody point?
August 13, 2022
Cranleigh residents have been reacting to a “technical issue” at a nearby Thames Water facility that has caused households and businesses in the area to receive very low water pressure or no supply at all. As one of five postcode areas affected by the outage on Saturday (August 13), the village spent the day hosting a bottled water station provided by the water company so that there was at least some provision as temperatures reached 33C.
Thames Water’s website explained that the issue was caused by a problem at Netley Mill Water Treatment Works. The news was greeted angrily by many people living locally, including ex-England footballer Graeme Le Saux who responded to the tweet by writing: “Your updates are as useless as you are. No information about where to collect water from. No mobile support for the vulnerable in this weather.”
And the former Chelsea defender also took aim at Jeremy Hunt after the Surrey MP posted a picture of himself with Thames Water CEO Sarah Bentley as he gave an update on the situation. Le Saux wrote: “Another PR stunt Jeremy. It is all about you, isn’t it? Whilst people suffer, you happily support mismanaged vital infrastructure. There is no bottled water at the pick up points, they’ve already run out. But hey, a great opp for you to send out some meaningless tweet!”
August 13, 2022
Yes and the NHS is the biggest out of control example of this whole issue.
No power in the patients hands, and the suppliers of healthcare take the mickey constantly.
August 13, 2022
And in other news while the BBC & Sky are reporting about the warm weather the MOD reported that another 261 illegal immigrants cross the channel on Thursday
August 14, 2022
GC – 261 Thursday – They won’t be alone then because 402 / 8 boats arrived Friday and 607 / 14 boats followed yesterday, Saturday 13 August.
August 13, 2022
The government wonât let private companies operate though – they ban house building, and fracking, and coal power stations, and new reservoirs, and new runways, and nuclear plants, and new roads, and a host of other things. Such NIMBYism means we might as well have state-run monopolies.
August 15, 2022
The reality is we do have state run monopolies. They subcontract some of the operational elements to other companies, but they run the show via regulators and regulations.
August 14, 2022
“The railways are not good at meeting peak demands with enough trains with enough seats, though the decline in daily commuting has eased this tension somewhat. ”
I’d suggest that the latter had been caused by the former: the widespread revolt against commuting is largely caused by the inhumanly crowded conditions workers have had to endure for decades on the trains. Before now they could do little about it. Now critical momentum has been reached, and – with the connivance of employers – a majority has joined in the anti-train revolution.