Families in Rochdale are experiencing fuel poverty

Arlene McCarthy

Responding to shock claims that Britain’s £300bn wholesale gas market may have been manipulated by the big power companies, Euro MP Arlene McCarthy has called for action including a full EU wide investigation into energy market manipulation.

Rochdale Euro MP, Arlene McCarthy is Vice Chair of the European Parliament’s Economic & Monetary Affairs committee and has been leading the European Parliament’s calls for tougher EU laws to combat market abuse following the Libor scandal.

Arlene said: “Following the revelations on the Libor crisis this is another case of apparent market abuse and manipulation in gas prices, which demonstrates the culture of chasing short term profits and gains in financial and commodity markets has not changed.”

“For some time I have feared there is an extensive cartel culture of market rigging and price fixing in the commodities markets. Companies guilty of abuse must face the full force of penalties and sanctions and jail for criminal behaviour.”

“The FSA must take action but as UK gas is the benchmark for gas traded at EU level I will be asking European Commissioners Almunia and Barnier to take urgent action on cartels and price-fixing and introduce tough rules on the setting of benchmarks and indices in the commodities markets.”

“Only last week Barclays were fined $470millon for alleged rigging of US wholesale energy markets. We must now ask the question has this also taken place in Europe?”

On the impact on consumers, Arlene added: “It would be cynical and callous if energy companies cite the rise in wholesale prices as the reason for retail price increases and in the end wholesale prices are being manipulated to increase the profits of the energy companies. Consumers will end up the victim of this great gas rip-off.”

“The North West region has one of the highest rates of fuel poverty in the UK at 20.3%, that’s a 1/5 of the population experiencing fuel poverty. Families have seen gas and energy prices rise by between 6 and 9% this year adding on average £200 to their bills energy bills, this type of market manipulation is abuse which must be urgently tackled.”

“Centrica, the parent company for British Gas, saw its operating profits for its domestic heating and power division rise by 23% in the first half of this year. Yet fuel poverty caused by escalating fuel prices and the squeeze on household budgets will mean pensioners are at risk of losing their lives from hypothermia this winter.”