by René Lavanchy

DEMANDS for the Government to raise a windfall tax on energy companies’ profits grew this week, as a new campaign started to persuade ministers to find more money to help the fuel poor and insulate more homes.

Friends of the Earth, Child Poverty Action Group leader Kate Green, Labour peer Roy Hattersley, Tribune and a range of MPs, trade unionists and academics have backed a statement saying the time has come for a “sensible one-off windfall tax to guarantee social and environmental justice” after gas prices have doubled and electricity prices increased by nearly two-thirds in the past eight years.

And Labour left-wing pressure group Compass, which is to organising the campaign, warns that more needs to be done if the Government is reach its target of generating 15 per cent of energy from renewable sources by 2020.

The statement reads: “The current spike in the price of oil means these companies are receiving unearned and undeserved windfall profits that are damaging to the rest of society, not least because the unprecedented price rises are fuelling inflation and therefore the cost of borrowing and repaying mortgages.”

It adds: “It’s absolutely right that the corporations who are benefiting from that original investment and the later privatisation pay their fair share to society.”

The campaign calls for money raised to be ring-fenced and paid out to fuel poor households, as well as spent on a national home energy efficiency programme.

Jenny Saunders, chief executive of National Energy Action, said a windfall tax would be an important gesture but warned that it would have to be better than the last one, levied on the newly-privatised utilities by Labour in 1997: “Where would the windfall tax go? If there’s another crisis, how do we know that this will be hypothecated? Last time it wasn’t.”

“They could force the energy companies to have social tariffs – they chose not to have that line. They could instruct them to do a lot more than they’re doing. I think they can do this without a windfall tax.”

While the Government has not indicated its position on a windfall tax, reports this week suggest a U-turn is imminent over Warm Front payments and the controversial Carbon Emissions Reduction Target, introduced in April to help insulate homes.

The CERT, which replaced an earlier home insulation scheme, cut the percentage of work targeted at poorer homes from 50 to 40 per cent.

Gordon Brown is now said to be considering reversing the move.

It was also reported in The Guardian that Mr Brown may increase funding for Warm Front, the heating and insulation subsidy fund, which has been cut from £350 million last year to £295 million this year.

A spokesperson for the Department for the  Environment, Food and Rural Affairs, which introduced CERT, this week refused to confirm whether it would be changed. They said: “We are looking at a number of issues, with this winter coming up, where we can help families with their fuel bills.”

Supporters can sign up for the campaign at: http://www.compassonline.org.uk/campaigns/campaign.asp?n=2773