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GMB warns of 'cartelisation'

Union urges Clark to block SSE merger with Npower

Greg Clark

Greg Clark: union wants him to intervene

Trade unionists have written to the Business and Energy Secretary Greg Clark calling for the proposed merger of SSE and Npower to be blocked.

The GMB says the tie-up will lead to the ‘cartelisation’ of a market that will be without competition, effective oversight or strong central direction.

Turning the Big Six energy providers into the Big Five would create “a chokehold that is bad for customers, workers and the wider economy”, it says.

The letter from the GMB states that the proposed merger meets all the criteria for a referral to the Competition and Markets Authority for investigation.

But if the CMA does not initiate an investigation then Mr Clark’s department should use its powers under the Enterprise Act 2002 to block it on the grounds of public interest.

Justin Bowden, GMB national secretary for energy said: “This is an obviously worrying time for SSE and Npower employees who will be concerned that job cuts will inevitably follow a merger.

“However, any merger should also be a worrying development for the Government.

“Professor Helm, in his Cost of Energy review, found that despite technological advances, and the benefits that market forces were supposed to deliver, ‘prices have gone up, not down, for many customers.’

“The creation of a Big Five will only exacerbate a situation that is already failing consumers and reduce further what little competition currently exists.

“Should the merger be allowed to proceed, then it will lead to the ‘cartelisation’ of a market that will be without competition, effective oversight or strong central direction.

“The Helm report was clear: it is for the Government to set out an energy policy to guarantee an energy supply that is secure, low carbon and the least expensive without repeating some of the ‘spectacularly bad’ decisions of the past; and, all operators in the sector are effectively contractors, and consequently Ministers have a duty towards the sector beyond that owed to other industries that are genuinely outside of the Government’s control and direction.

“We are at a genuine crossroads in terms of the UK’s future direction for its energy strategy and policy for at least a generation to come.

“The merger between SSE and Npower is a test of that duty and until there is a settled energy policy, we risk a private cartel if the merger is given approval.

“GMB urges the Secretary of State to exercise existing powers to prevent yet more needless price hikes that are the penalty for a dysfunctional energy market.”

BiFab march on Holyrood

GMB and Unite members will today march on Holyrood to urge the Scottish government to help save the Burntisland Fabrication yards.

The Fife-based company is facing possible administration because of a dispute with Dutch contractor Seaway Heavy Lifting over a £100m wind turbine deal for SSE.

Up to 600 workers will join the demonstration demanding action to save 1,400 jobs in Fife and Lewis.

They will gather in Johnston Terrace, in the shadow of Edinburgh Castle, and head down the Royal Mile to the Scottish Parliament.

SSE is the largest stakeholder in the £2.6billion Beatrice Windfarm Limited (BOWL) Project – and union leaders believe it holds the key to resolving the contractual payments dispute between BiFab and SHL.

It believes SSE is blocking the path to a resolution, and it wants its CEO, Alistair Phillips-Davies, to step in.

Pat Rafferty, Unite Scottish Secretary, said: “It’s time that Alistair Phillips-Davies, CEO of SSE, came out of the shadows on this crisis used his powers to get this sorted.

‘”He needs to rein in SHL and guarantee these jobs and the future of the communities in Fife and Lewis affected by it.’”

He said the workforce was leading by example – and deserved the full support of all involved.

“The dedication and professionalism of our trade union members, who are working for free to defend their futures and their industry, should send a loud and clear message to all stakeholders and politicians – this is a workforce that must be saved.”

GMB Scotland Secretary Gary Smith said: “This work and this contract will be completed in Scotland if everyone pulls together – there is a way forward here.

“But the spotlight now needs to be put firmly on SSE which controls the billion pound Beatrice contract, the Dutch contractor SHL at the root of the payments dispute and also the UK Government who have £21 million of taxpayers’ money underwriting this.”

Economy Secretary Keith Brown stressed the Scottish Government would leave ‘no stone unturned’ in seeking a resolution with all stakeholders.

Under questioning by MSPs, Mr Brown acknowledged ‘disputed payments’ between BiFab and SHL and revealed an undetermined role by the UK Government in the contract. The trade unions are now seeking clarification.

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