However, there are significant costs implied by the scheme. Labour calculates that delivering essential upgrades to the UK’s entire housing stock will cost about £250bn, or an average of £9,300 per house. The party pledged to provide £60bn of direct public subsidy for the programme, with the rest paid for “through energy savings”.
OK. No, take their numbers. Let’s not worry about examining them.
So, on that basis an answer as to how the whole sum will be funded is required.
The fact is that, me apart, I can see now one who has n answer to this. Naomi Klein is miles off target in her latest book. Ann Pettifor cogently argues it is by borrowing in her latest book. But no one says who will buy those bonds. I have, here. Changing the rules of ISAs and pension funds could provide all the cash needed to fund the Green New Deal. The issue is so vital I will be returning to it, again and again, I suspect. We have to get this right.
OK, fair enough.
Now the tough bit. For we’ve not got a mechanism here by which the pensions investors get the savings from the energy bills. How does that work?
My flat is lent money to insulate. This reduces energy bills. Great. Money goes back to those pensions investors. Both interest and, at some point, the capital sum because people do consume their capital as they spend their pensions.
So, what’s the mechanism by which those lower energy bills pay the pensioners?
The owner of the flat pays some portion of the lower energy bill to the pensioner? The energy company charges the same amount and diverts some to the pensioner? The taxpayer pays the interest and capital back?
How does this work?
For extra points, once we’ve built that system that does the paying back then why do we need the compulsion of making pensions invest in it?
This is the problems with Spudda’s wand waving. He says “bonds”. OK, But who pays them back out of what revenue stream?
“The fact is that, me apart, I can see now one who has n answer to this”
Spud alone has the answers…..
What an arrogant twat he is.
Once you have savoured the towering modesty of the great man, relax, for there is no way that anyone else can grasp the sheer unfathomable beauty of the scheme.
He is on record innumerable times as saying all this can be paid for by the State creating money. So why steal the pension funds? They are not needed.
The fact is that, me apart, I can see now one who has n answer to this
Imagine how frustrating this must be – that someone of such genius is stuck in a terraced house in Ely, and not In Charge Of Everything.
” But who pays them back out of what revenue stream?”
Its all predicated on the same principle of Government Debt is everywhere – find another idiot to lend you more money to buy new bonds to pay the maturing ones, plus a bit extra, of course. What Government ever reduces its overall debt levels? Its the never ending Ponzi scheme, until of course it hits the wall , as all Ponzi schemes do eventually.
The fact is that, me apart, I can see now one who has n answer to this
Imagine how frustrating this must be – that someone of such genius is stuck in a terraced house in Ely, unable to type properly.
@ Jim
“What Government ever reduces its overall debt levels? ”
A genuine Conservative government as in the 1980s – Mrs Thatcher was allegedly enthralled by the prospect of the National debt being repaid within twenty-five years. I think the 1951-4 Churchill government also reduced debts but I cannot be sure.
Energy savings from insulation, etc are never what is claimed because people just turn up their thermostats because they have been told they will be saving on their energy bills, so the need to be thrifty and careful with the room thermostat diminishes. See Human nature.
Also in better insulated houses, condensation becomes an issue – so open the windows or use extractor fans to push warm, moist air out and pull fresh cold air in. Heat the street.
Similarly, low energy light bulbs. Use more, leave them on longer, because they are saving money.
Capt. Potato refers with admiration as lavish as he is ever able to bestow on anyone other than himself to Ann Pettifor who in all likelihood is not the tasty nibble she sounds like.
Indeed, as luck would have it, she was being interviewed on WatO this lunchtime and she was as discourteous and strident as one could wish of someone enjoying the master’s qualified approbation.
Where does that £9,300 per house go? Loft insulation costs a couple of hundred, cavity wall filling maybe £500. Even upgrading to a combo boiler will set you back only £2,000. Double-glazing and new doors could account for the rest, but over 80% of houses already have double-glazing.
And this is subject to Worstall’s Law. Labour are proposing a new policy while remaining wilfully ignorant of the existing policies in this area. There are already direct grants for insulation; there are indirect incentives (mandates on energy companies) to encourage energy efficiency. Rented properties must meet energy standard E by from April 2020, rising to D in 2025 and C in 2030 (provisional, but likely to go ahead).
Of all Labour’s proposed wastes of money, this has to be the worst, by virtue of the sheer sums involved.
@john77
http://budgetresponsibility.org.uk/download/public-finances-databank
Much of the second half of the 50s and most of the 60s. A couple of years under Mrs T. A few years under Blair (during the period when they followed the Tory budgets).
Andrew M,
Don’t forget tax payers are paying for this with government in the middle. As we know whenever government is involved multiply all costs by PI().
…..
Lefties: We’re going to increase your energy bills to pay for renewables and to make you use less energy to save the planet.
Also lefties: W’re goona steal you pensions to pay to fix your houses so you’ll get lower energy bills.
I’ve got a better plan. Fuck off and leave energy prices and my pension alone.
BiND
Well it’s slightly better than California.
lefties – we’re going to make you pay more for power so that we can save the planet
lefties – we’re going to prevent proper forestry management
lefties – we’re going to mandate lower prices so cut “other costs” = maintenance and prevention of fires
lefties – Global warming and evil capitalists have set fire to the state.
This quote from More Or Less needs repeating again and again:
Q: So how do you get a return from Green Investment?
A: You don’t, it’s you spending money on Green projects.
There’s no return. It’s you giving money away. It’s the same as “investing” in the RSPCA. You are “purchasing” warm fuzzy feelings, you are certainly not lending money and charging rent on it, and definitely not lending money with the future prospect of the loan being returned.
I sometimes feel that the Climate Change Act is designed to solve the pension ponzi scheme crisis. I mean, no-one can honestly believe the CCA is going to do anything to change the climate so it must have another purpose.
Once we’re well on our way to ‘zero carbon’ status, we’ll get a nice cold winter with a big anti-cyclone parked over Europe. All the bird-mincers will stop turning and we get a long power cut. (There’s no way we’ll have built enough nuclear power stations. We’ll srill be writing the environmental impact studies for them and we won’t even have started the diversity plans).
After a few days, even the best insulated houses will get pretty cold and all the old folks will pop their clogs. Pension crisis solved.
“All this can be paid for by the State creating money”
Thanks – I wondered where the magical £60bn was going to come from…
Sorry, it wasn’t More or Less, it was Money Box about three weeks ago. Same point stands though.
McDonnell on campaign trail “UK Economy is doing badly, Gov’t must spend – economists agree”
Sadly Brown’s 2002/3(?) Keynesian splurge when economy was doing OK, then 2007/8 splurge still not fixed. “There’s no money left”
.
@john77 November 4, 2019 at 2:03 pm
Correct on Mrs T paying down debt
@John B November 4, 2019 at 3:13 pm
Yes. There are many who believe leaving them on “saves money”.
Similar to many believing “tax deductible” means the £1,000 cost reduces tax bill by £1,000
Ken,
Yes, the madness that is California (my amphasis):
@TMB
Thanks. I missed WatO start and wondered who the shrieking lefty harridan (@13:15ish) was – even female BBC presenter seemed annoyed
Ann Pettifor wants Back to 1970
Thing is, let’s saw we spend this £10k on insulating my house.
My current gas and electricity bill combined is only £50 pcm, for a 3 bed end terrace.
Let’s say that the resultant savings half my bill. 10,000/25 = 400 months, or a little over 33 years, just to pay the capital off, before considering any return from interest payments.