The Chamberlain News

Corbyn tells council to get a move on with energy company plans

Jeremy Corbyn has urged Labour-led Birmingham city council to get a move on with its plans to set up an energy company to provide cut-price fuel to homes and businesses.

The council announced three years ago a scheme to buy gas and electricity supplies direct from wholesalers, cutting out the six big energy companies whose “monopoly of the market” it claimed had led to inflated bills.

But the plan hasn’t progressed and cabinet member Majid Mahmood admitted he was “embarrassed” by the likes of Nottingham and Bristol where the local councils are setting up energy companies.

Cllr Mahmood, a key Midlands supporter of Mr Corbyn, let slip that the Labour leader thinks Birmingham city council should be doing better. “Every time he sees me he says we should be getting on with this,” Cllr Mahmood told the resources scrutiny committee.

In his manifesto to become Labour leader Mr Corbyn promised to “create an energy policy for the 60 million not the big six” through creating local power companies.

Cllr Mahmood intends to up the pace on developing a Birmingham company to supply cheaper fuel and will visit Bristol city council to learn from its experience.

Cllr Mahmood, cabinet member for value for money and efficiency, said Birmingham should have tackled the issue several years ago when the energy sector was deregulated, but missed the chance.

Three years ago the city council’s then leader, Sir Albert Bore, said an energy company would help Birmingham families, and lead to a £750,000 cut over three years in the council’s own power bills.

At the time Sir Albert said:

We want to make city residents and businesses less reliant on buying energy from the big six energy companies.

We need more local control over energy and we will aim to set up an Energy Services Company that will generate energy for local consumption from the city’s waste, its woodland management, from solar installations and also ensure that more efficient district energy systems are installed.

We are looking to both reduce the costs of energy to Birmingham people and businesses but also to generate income which will be ploughed back into supporting local services.

In its latest budget plans the council aims to save £650,000 a year by setting up an energy company that will offer special help to low-income families on pre-payment meters.

Cllr Mahmood told the committee he was determined to deliver efficiency savings across the board for the council, which has to find about £250 million in budget cuts up to 2020.

Better management of contracts let by the council has already saved £5.6 million, with officers under strict instructions to renegotiate a lower price whenever a contract expires. One renegotiation alone resulted in a 44 per cent saving for the council.

New advertising hoardings across the A38 Aston Expressway are bringing in £2 million a year for the council, Cllr Mahmood revealed.

The cabinet member said he was considering saving money by scrapping paper copies of the council diary, given to councillors and staff each year, because all of the information was available online.

He urged council officers who were looking for savings to be “much more innovative and look at income generation schemes”.

Cllr Mahmood stressed that at a time of harsh Government austerity it was even more important for the council to make sure “left behind” inner city wards in Birmingham received their fair share of funding. He wanted to make the inner city areas “as nice” as Sutton Coldfield.