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Energy bosses rake in record profits just as bills are set to triple

Management consultancy BFY Group forecasts that energy bills are soon set to triple while corporations rake in record profits
Issue 2816
iGMB strikes out british gas offices whith GMB orange flags and a banner which reads Stop the british gas fire. A scheme which british gas fire and rehired staff to raise profits and energy prices

British Gas workers picket in Leeds against energy bosses’ fire and rehire scheme in March, 2021 (Picture: Laura Miles)

As electricity, gas and petrol price rises wreck people’s lives, the corporations that supply the energy are raking in record profits. And their super-rich shareholders are also grabbing fortunes.

British Gas owner Centrica announced on Thursday that operating profits had increased five-fold to £1.34 billion as bills soar. That’s the profits just for the six months to the end of June. Bosses said they would be reinstating the dividend payments suspended during the pandemic. This money goes to the parasites that feed off the profits from poverty.

British Gas also waged a brutal fire and rehire war against its workers last year to drive down pay and conditions. The company has around 12 million customers. The profits could have given each of them at least £115 off their bills. Group chief executive Chris O’Shea ridiculously claimed Centrica’s profits were not linked to increased bills.

On the same day Shell announced a profit of £9.5 billion for the three months to June. That beat even the £7.5 billion record set for the first quarter.

In May, then chancellor Rishi Sunak unveiled a windfall tax on energy firms including both Shell and Centrica, which is expected to raise about £5 billion. That’s across the whole sector, yet it’s less than half the money Shell alone seized in 13 weeks.

Shell is using some of the cash to hand dividends to shareholders—a payment for doing absolutely nothing. It will also launch a £5 billion share buyback move. This is where a company buys its own shares. The scheme will give some shareholders a payout but there are other motives as well. 

By buying its shares, the company concentrates ownership under management’s control. It raises the share price on the stock markets and so attracts more banks and rich individuals looking to make a quick buck.

The company’s share price has climbed 25 percent this year. Shell makes great play of its concern over climate change. It wants to be known as an “energy transition company”. But its gas and oil divisions generate more than 80 percent of its profits. Renewables and energy solutions are responsible for less than 4 per cent.

Energy bills are soon set to triple, not because of some “outside forces” or inevitable factors but because of deliberate decisions by bosses and politicians. The average household could face a price cap of £3,850 a year by January, far exceeding the worst predictions. Millions will not be able to pay.

The forecast comes from management consultancy BFY Group, not left wing scaremongers. It’s a pro-boss organisation that says it works for opportunities for firms to “increase their profitability”.

Gemma Berwick, a senior consultant at BFY, said, “If you look back at the same time last year, your bill is likely to be three times what you would have been paying in January.”

And people on prepayment meters, who disgracefully pay the highest rate, are expected to face a bill of £500 for January. In the depths of winter, people will therefore be forced to “self-disconnect”—to freeze and and probably starve as well.

When you read about deaths from malnutrition and hypothermia, remember these profit figures.

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