Jump to content
House Price Crash Forum
interestrateripoff

Why The Poorest Will Pay The Most To Upgrade Ageing Infrastructure

Recommended Posts

http://www.independent.co.uk/news/business/news/why-the-poorest-will-pay-the-most-to-upgrade-ageing-infrastructure-9574895.html

The Government’s infrastructure plans have been described as “more regressive than taxation” by MPs.

That is because consumers are facing an extra £250bn on their household bills, money which will be used to pay private companies for repairing their own crumbling infrastructure, with no guarantee that the repairs will actually benefit consumers.

The most vulnerable people would be hit hardest by the extra charges, the Public Accounts Committee has warned.

MPs on the committee have demanded that the Treasury calculate how hard-pressed consumers will be able to afford the extra costs.

Margaret Hodge, the chair of the committee, said: “No one in Government is taking responsibility for assessing the overall impact of this investment on consumer bills and whether consumers will be able to afford to pay.”

The total bill to replace the country’s ageing infrastructure, help meet policy commitments such as climate change targets, and meet the long-term needs of a growing population, is estimated at £375bn.

“It is the consumer – through their various bills – that is expected to fund at least two-thirds of this investment where the infrastructure is financed, built, owned and operated by private companies,” Ms Hodge said.

“Currently, consumers rely solely on Government and regulators to protect their interests. But it doesn’t take much nous to work out that this is going to have a tough impact on the consumer.”

So that's £250bn that won't be spent on discretionary consumption. More businesses to fail?

Share this post


Link to post
Share on other sites

So in IndyWorld gas and electricity should be provided free of charge and funded directly by the taxpayer.

That seems to be the logic of this story.

Share this post


Link to post
Share on other sites

So in IndyWorld gas and electricity should be provided free of charge and funded directly by the taxpayer.

That seems to be the logic of this story.

It does seem that way!

Share this post


Link to post
Share on other sites

Why do they say the poorest will pay the most?

Do they mean as a proportion of their income?

Britain has a Third World economy based on borrowing and consumption, it's quite natural to assume that in the future most of its citizens will enjoy a Third World standard of living.

Share this post


Link to post
Share on other sites

So in IndyWorld gas and electricity should be provided free of charge and funded directly by the taxpayer.

That seems to be the logic of this story.

Yes, it's ridiculous. The provision of energy costs money, and when the environmental effects of its production are accounted for, it costs even more money. The government should concern itself just with specifying the environmental and contractual obligations for its provision and ensuring a competitive market. It is, or should be, up to the energy companies how they meet those obligations, and receiving money from the taxpayer should not be an option.

Energy bills will almost certainly need to rise in the future, and this will inevitably cause hardship for those on lower incomes. However, if the government wishes to mitigate this hardship, it should be through the provision of lower taxes or higher benefits, not through the funding of power companies. The latter will cost more money while failing to provide any incentive to conserve energy. Government micromanagement is not the way to do it.

Share this post


Link to post
Share on other sites

I think the story may be that 'infrastructure' used to come out of public accounts.

Now, it comes out of private accounts yet there seems to be no corresponding reduction in overall public expenditure.

QED - overall 'taxes' have gone up for the same basic set of services. And it has also been made more regressive in structure in the process.

It is still funded from public accounts, a big chunk of public money is spent on social benefits to help poor pay bills. The indirect funding of private infrastructure by public is likely to be more expensive because of an additional cost called private profit.

Share this post


Link to post
Share on other sites

I think the story may be that 'infrastructure' used to come out of public accounts.

That's true of some infrastructure: most obviously roads, and terrain engineering such as walls that constrain a stretch of river or coastline.

Most others - such as gas and electricity - were built by private companies. They were nationalised for a time, leading to frequent outages and spiralling costs, before being returned to private companies. Unfortunately these new private companies are nothing like the original ones, and are mired in quasi-public-sector politics, perverse incentives, and largely-counterproductive regulatory red tape, so they have their own set of problems. And even now, meddling politicians can't keep their hands off :angry:

We want quick fixes which'll just shift problems and set back the organic market evolution that's the only real solution.

Share this post


Link to post
Share on other sites

It is still funded from public accounts, a big chunk of public money is spent on social benefits to help poor pay bills. The indirect funding of private infrastructure by public is likely to be more expensive because of an additional cost called private profit.

One of the evolutionary changes in today's market is the rise of quite a lot of co-operative energy schemes.

They're as yet on a small scale. And politicians meddling will do one of two things: either it'll set back their progress a generation, or it'll promote them, leading to them becoming another set of politically-inspired monsters doing all the wrong things.

Share this post


Link to post
Share on other sites

I think the other night with my LCD on low power, I was running my entire flat with a PC (excluding fridge freezer) for less than running an old CRT tv set (typically 170 watt). Lighting was only 11 watt.

Can remember my parents houses being ablaze with 100 watt tungsten light bulbs in the 70's.

Share this post


Link to post
Share on other sites

I think the other night with my LCD on low power, I was running my entire flat with a PC (excluding fridge freezer) for less than running an old CRT tv set (typically 170 watt). Lighting was only 11 watt.

Can remember my parents houses being ablaze with 100 watt tungsten light bulbs in the 70's.

Your nice efficient appliances are not infrastructure. They're products sold in regular shops to regular consumers.

They haven't spent generations mired in the political meddling of nationalisation and re-privatisation: rather they've been free to get on with improving their products. And in a competitive market, getting cheaper too.

My old 19" monitor was rated 45W, which was a best-of-class in its day. The 27" monitor I bought just a couple of weeks ago is rated 32W. Each cost just under £200 to buy new. And over my bed are 4W (LED) reading lights, where once maybe 40W would've burned.

Share this post


Link to post
Share on other sites

Your nice efficient appliances are not infrastructure. They're products sold in regular shops to regular consumers.

They haven't spent generations mired in the political meddling of nationalisation and re-privatisation: rather they've been free to get on with improving their products. And in a competitive market, getting cheaper too.

My old 19" monitor was rated 45W, which was a best-of-class in its day. The 27" monitor I bought just a couple of weeks ago is rated 32W. Each cost just under £200 to buy new. And over my bed are 4W (LED) reading lights, where once maybe 40W would've burned.

Yup but if you exclude showers, kettles and cookers for a moment you are not really requiring a huge amount of infrastructure. Its not beyond the possibility of meeting most of my base load with solar panels.

Indeed in the States some utilities are successfully lobbying to tax solar panel users.

Share this post


Link to post
Share on other sites

If you use a thermostat, the heating system compensates.

Depends on whether your heating is gas or leccy. The thermostat will compensate for the same amount of heat in both cases but the gas heating will be both more efficient and cheaper. By more efficient I mean I mean more efficient overall. Electric heating is of course 100% efficient at the point of use but you have generating losses and transmission losses which drag it done to may 30%-40% whereas gas should be over 70% and up to 90%.

Share this post


Link to post
Share on other sites

.....when the countries main assets that once beloged to the people, where profits were used to maintain and improve are sold to pay yesterdays and today's debt commitments and liabilites.....the new private owners will naturally take the profits for themselves and keep them, but will still require more for upgades, improvements, and future investment .....got you by the short and curlies, paying for it twice, sold down the river....hey ho.....we are all now tenants and they have put the rents up. ;)

Edited by winkie

Share this post


Link to post
Share on other sites

If you use a thermostat, the heating system compensates.

I do, and it doesn't. It's been a while now since the weather was cold enough to threaten freezing pipes (wasn't that 2011-ish?), and longer since I was so ill as to need heating for myself.

Share this post


Link to post
Share on other sites

Create an account or sign in to comment

You need to be a member in order to leave a comment

Create an account

Sign up for a new account in our community. It's easy!

Register a new account

Sign in

Already have an account? Sign in here.

Sign In Now

  • Recently Browsing   0 members

    No registered users viewing this page.

  • The Prime Minister stated that there were three Brexit options available to the UK:   218 members have voted

    1. 1. Which of the Prime Minister's options would you choose?


      • Leave with the negotiated deal
      • Remain
      • Leave with no deal

    Please sign in or register to vote in this poll. View topic


×

Important Information

We have placed cookies on your device to help make this website better. You can adjust your cookie settings, otherwise we'll assume you're okay to continue.