THE latest cost-of-living crisis has laid bare the limitations of markets at a time of crisis.

In the 1980s people were promised that when it came to gas, electricity and water, putting those utilities in the private sector would lead to more competition and lower prices. Yet here we are in a situation where that model has collapsed.

I'm not going to argue that every privatisation that took place was bad. I'm old enough to remember the days when it was illegal to own a telephone apart from one you could rent from BT.

In the 1970s, there was a waiting list to have a phone line installed and even then you would often find yourself in a situation where you were sharing the line with somebody else and in danger of listening to other people’s conversations.

That wasn't really a model that had much to commend it.

Yet even when privatisation occurred the requirement was kept that those who wanted to have a telephone line could have one. There was no question of somebody being told that they lived in such a remote place that no line would be provided to them.

Then we have the model of gas and electricity. Not long ago it was possible to go to two comparison websites and see what deal was best one for you.

Now that world has disappeared. People are slaves to their energy contracts and it is pretty much impossible to move to another company because there are no better deals available.

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The energy companies know this too well which is why some of them have been urging the government to help people with energy costs even to the point of imposing a windfall tax.

It may seem counter intuitive for them to do that but they know full well that the longer this situation persists the more people will start questioning the existence of private energy companies and the more people will call for their nationalisation.

There was another important knock-on effect of the privatisation of energy and that's in the field of investment. There was a time that a big nationalised enterprise such as the CEGB, could build the Dinorwig power station.

It's highly unlikely that anything of the sort would be built now because the energy companies don't have the money.

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The UK government has shown time and time again that it doesn't understand how much investment it needs to put in to provide the right level of infrastructure nor does it have any plan for satisfying the country’s future energy needs.

I had experience of this with successive UK Conservative governments. First they stopped the subsidies for solar panels, then they stopped the building of onshore wind farms.

Their next mistake was to fail to build the Wylfa B power station. To cap it all off, they then refused to support  the Swansea Bay Tidal Lagoon.

It struck me sometimes that they would soon be relying on an army of hamsters on wheels to generate electricity because they were rejecting everything else.

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This was all because they simply didn't want to pay the cost of building the power stations that were needed.

The attitude had taken root in Whitehall that it was for private companies to build power stations and that there was little role for government. Sure enough, we now find ourselves with severe energy problems.

Privatisation was sold as a concept that would provide more choice for consumers, drive down prices and stimulate the development of new investment. In the main this has simply not happened.

Where is the competition now that that was promised would work in the interest of consumers? 

Despite the existence of a number of energy companies, most of them are simply charging up to the cap imposed by the UK government. That cap is far too high and has led to people seeing increases of 50 per cent or more on their energy bills.

Other countries have not taken the same route. We have now a clear case of market failure that the current government is doing nothing to address. 

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I'm not arguing that markets always fail to deliver but it's clear if we leave the current situation to the market, there will be no price competition and many, many people who will not be able to heat their houses this winter.

If what we want is a society based on the premise of people being excluded from the basics of life simply because they haven't got enough money, then that's where we’re headed.

There is an alternative and we need to make the case that healthy societies are judged by the way they look after their most vulnerable and not for the huge amounts of money that a small number of people can make.

Individuals being  able to put food on the table and keep a house warm is surely a fundamental part of the health of any society.

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