Profits prized over ending fuel poverty
Paying the rent, putting food on the table or heating the home are the bleak ’choices’ families make each day.
Over 5 million households and rising live in fuel poverty in Britain today. Fuel poverty appears to be a new phenomenon but is another manifestation of the dire effects of financial hardship as increasing numbers of ordinary people find it difficult to make ends meet.
Such a condition has arisen because only the ‘price’ of energy determines who gets what, irrespective of need. Price is the most prominent feature of capitalism and does not distinguish between a person’s need for bare necessities against another’s desires for luxuries.
Banks in the city illuminate spacious empty lobbies at 2 a.m. in the morning because they can afford to but a pensioner in desperate need to keep warm at 2 a.m. in the morning will not turn on his small heater because he does not have the money to pay for the same electricity.
This is the stark human outcome of the privatisation of the utilities in the late 1990s. Dividing up various bits of each utility into production and distribution companies was supposed to increase competition between suppliers, improve service and lower prices. Privatisation was touted as solving the perennial problem of unproductive and inefficient nationalised utilities which had plagued the British industrial landscape.
As with most privatisations the most conspicuous effect has been significantly higher prices for consumers. To illustrate, since privatisation, gas prices have risen by 130% compared to an increase of just over 20% in the 10 years before privatisation (see chart). In comparison, general prices (RPI) have risen by 40-60%. Naturally, fewer and fewer people are now able to afford a decent or even adequate supply of a bare necessity than before privatisation. Meanwhile, the privatised energy companies are making huge profits – up to £125 – per customer according to Ofgem, the government body assigned to regulate the private sector energy companies. It doesn’t take an economist to work out that fuel poverty and huge profits of the energy companies are two sides of the same coin.
The average household bill for heating, cooking and lighting is nearly £1,350 with people in financial hardship paying more because they are forced to pay by metering. The poor are in arrears and increasingly getting in debt unable to pay fuel bills since the government assistance to help placate the public against such blatant injustice is little more than token help in comparison to the profits of the energy companies.
Clearly corporate profits have been prized over people – the hallmark of capitalism.
Islam’s view towards public utilities
The Shariah protects utilities as public properties in Islam belonging to the people in the truest sense of the word unlike nationalised industries whose status depends on the political colour of capitalist governments.
The Messenger of Allah (swt) said: “Muslims are partners in three: Water, pastures and fire.” Partners means these belong to Muslims as a whole while gas, oil and electricity are from the description of fire since they are fire based fuels. It is not allowed to assign ownership of these including generators and distribution systems to private ownership and they must permanently remain with the public. Profits can therefore never be squeezed out of the people to pay for utilities because these industries belong to the Ummah as a whole not to individuals or companies – who would rightly run their businesses for a profit.
These are of the public properties because without them the Ummah and society would suffer immense hardship. Yet these are not state properties with the Khaleef responsible for the supervision (not ownership) in the best interests of the Ummah.
This ensures that these utilities, which are essentially necessities, are always available to all according to need and not the market which avoids the obscene and unjust situation of fuel poverty under capitalism.