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Society & Culture9 mins ago
Acceptable Profits ?
14 Answers
British gas have announce an 11% increase in profits, hardly surprising given the price rises.
Is this a justified profit ?
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Personally I believe ALL utilities, gas/water/elec and rail should be privatized and non profit making, so I find this unacceptable.
Is this a justified profit ?
http://
Personally I believe ALL utilities, gas/water/elec and rail should be privatized and non profit making, so I find this unacceptable.
Answers
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"Personally I believe ALL utilities, gas/water/elec and rail should be privatized and non profit making, so I find this unacceptable."
If they were nationalized they'd still need to make profits so they can secure future stock and invest in infrastructure.
However, wouldn't it be handy to be generating 11% profit for the government coffers? The problem with privatization, in my mind, is that it reduces the state's options for cash generation.
If they were nationalized they'd still need to make profits so they can secure future stock and invest in infrastructure.
However, wouldn't it be handy to be generating 11% profit for the government coffers? The problem with privatization, in my mind, is that it reduces the state's options for cash generation.
It depends. Companies need to make a profit and pay dividends otherwise no-one will invest in them. If the increase in profits is because of improved productivity/efficiency then good luck to them. But at the moment there doesn't seem to proper competition, the service is generally poor and most people have a story about a rip-off (I know I have). Something needs to be done but I don't think nationalisation is the answer- the governement and civil servants have enough on its plate without having to set up and manage such a business in which they have no expertise
I am not sure that the idea of privatised and non-profit making go together, do they?
We may be able to learn something from the Victorians. A structured system of utilities was only just being formed at this point. It is my understanding that the victorians recognised that a purely private company would not be the right vehicle for the provision of a service with a social obligation, such as Utiliities, and so restricted such services to companies who by their own laws of incorporation had the amount of profit they could make capped - This meant that investors/ shareholders were assured of a guaranteed return, year on year, and that the utility companies were able to keep prices under control and invest in the infrastructure.
Not sure quite how accurate this story is, but we could do with a form of incorporation like this for our Utility companies, i think....
We may be able to learn something from the Victorians. A structured system of utilities was only just being formed at this point. It is my understanding that the victorians recognised that a purely private company would not be the right vehicle for the provision of a service with a social obligation, such as Utiliities, and so restricted such services to companies who by their own laws of incorporation had the amount of profit they could make capped - This meant that investors/ shareholders were assured of a guaranteed return, year on year, and that the utility companies were able to keep prices under control and invest in the infrastructure.
Not sure quite how accurate this story is, but we could do with a form of incorporation like this for our Utility companies, i think....
http://
Seems like British Gas won't be satisfied even now, because they aim to increase their charges even further, time there was a cap on utility price rises
But it looks as if their bosses will be sitting pretty, I just do not understand why some continue to give them their custom, seeing that they are nearly always the first to 'up' their charges.
/// Despite this, price rises for its 12million customers could come as early as next winter. ///
/// Meanwhile, Centrica’s top five executives will collect a shares windfall predicted to top £10million. ///
/// Company chiefs will be given millions of shares under a long-term bonus scheme set up three years ago, which is linked to the firm’s performance. ///
/// Bosses will benefit from the fact that they will not receive the shares until after the end of the current tax year. ///
/// As a result, they will cash in on Chancellor George Osborne’s cut in the top rate of tax from 50 per cent to 45 per cent. ///
Seems like British Gas won't be satisfied even now, because they aim to increase their charges even further, time there was a cap on utility price rises
But it looks as if their bosses will be sitting pretty, I just do not understand why some continue to give them their custom, seeing that they are nearly always the first to 'up' their charges.
/// Despite this, price rises for its 12million customers could come as early as next winter. ///
/// Meanwhile, Centrica’s top five executives will collect a shares windfall predicted to top £10million. ///
/// Company chiefs will be given millions of shares under a long-term bonus scheme set up three years ago, which is linked to the firm’s performance. ///
/// Bosses will benefit from the fact that they will not receive the shares until after the end of the current tax year. ///
/// As a result, they will cash in on Chancellor George Osborne’s cut in the top rate of tax from 50 per cent to 45 per cent. ///
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If, as a nationalised industry, they still made a profit then that would effectively be a tax on the customers. It's of minor concern if needed investment comes from tax gathered some other way or directly from the nationalised industry. It's just accountant's sleight of hand, and a field day for those who like to make political capital.
I think the question of morally acceptable profits is a subject by itself. Should someone be able to become unbelievably rich simply because they found a way to fleece the public, selling at a price much greater than the product or service cost to provide: or is that immoral ? What is down to freedom of action and what down to preventing abuse ?
I think the question of morally acceptable profits is a subject by itself. Should someone be able to become unbelievably rich simply because they found a way to fleece the public, selling at a price much greater than the product or service cost to provide: or is that immoral ? What is down to freedom of action and what down to preventing abuse ?
Problem here is that you really dont have a choice, there is no real competition in terms of the product they sell.
they are all roughly the same price wise and they all put their prices up one after the other.
if this was a pizza or a football ticket, customers could hit them where it hurts , dont buy that particular pizza or dont buy tickets for the games.
theyd soon get the message and you can do without both of the above mentioned products.
the utility companies know they have everybody by the proverbials, you cant do without power and they get away with what they do because of it.
so you switch supplier, next year you switch again when the inevitable price hikes come, its just a customer merry go round, which they always get the best ride from, you cant win and they have made sure of that.
There is no competition, where else can I go to get gas or electricity from ?, its only the metering thats at stake for them.
they are all roughly the same price wise and they all put their prices up one after the other.
if this was a pizza or a football ticket, customers could hit them where it hurts , dont buy that particular pizza or dont buy tickets for the games.
theyd soon get the message and you can do without both of the above mentioned products.
the utility companies know they have everybody by the proverbials, you cant do without power and they get away with what they do because of it.
so you switch supplier, next year you switch again when the inevitable price hikes come, its just a customer merry go round, which they always get the best ride from, you cant win and they have made sure of that.
There is no competition, where else can I go to get gas or electricity from ?, its only the metering thats at stake for them.
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