Eamonn Butler at the Adam Smith Institute ponders whether there is a new economic interventionism in the air. Labour reverts to type. We knew it would happen, just a matter of when.
On the 6th of January, Darling “demanded” a meeting with the energy regulator to explain why prices have escalated so quickly. In a letter to the energy regulator Ofgem, Darling wrote:
“Increases in… energy prices have reminded us of the relationship between energy prices… and the government’s objectives around tackling fuel poverty.”
This looks a lot like political pressure to me.
Darling intervened again on the 9th of January, this time demanding that power companies reduce their bills. This is definitely political pressure, and anyway, none of his business.
However, Ofgem added that UK energy prices were still amongst the most competitive in Europe (take a bow Margaret).
On a roll, Darling suggested that mortgage lenders pass on interest rate cuts to their customers, which again is none of his business. Also, in a shameless attempt to force the Bank of England into a corner, he suggested they cut interest rates. In fact Gordon Brown himself had to correct a gaff in which he suggested an interest rate cut was expected.
This only serves to show the extent to which Labour ever believed in Bank of England independence, or non-interventionism.