Energy Spending Priorities: Investors and Consumers

Jim Shannon Excerpts

Monday 4th July 2016 Commons Chamber

[Steve McCabe (Birmingham, Selly Oak) (Lab)]

I congratulate the hon. Member for Na h-Eileanan an Iar (Mr MacNeil) on securing this debate and on the work of his Committee in probing the Government.

As the Committee makes clear, we seem to have come a long way since the heady days of the promises to lead the “greenest Government ever”. In reality, we have had years of policy chopping and changing, and now an energy policy that seems to be going into reverse. First we had the green deal, ended, in effect, last July after local authorities the length and breadth of the country had wasted a fortune in time and money trying to make it work. In my own area, Birmingham Energy Savers is one such venture, launched at the behest of the Government in 2011 and forced to wind up as the latest shift in Government policy brought its ambitions for energy efficiency to a shuddering halt. No one on the Government Benches wanted to listen to concerns about the green deal in the early days. They ignored warnings about the complicated structure, the expensive bureaucracy, and the sheer cost to homeowners. They insisted that they knew best, but of course they were wrong. With the sure touch that has become the hallmark of Conservative government, they decided to end the scheme, after years in denial, in the very month that it reached its highest level of performance.

It was not just the green deal. The previous Labour Government had a fair degree of success with Warm Front, which was a progressive, taxpayer-supported initiative designed to reduce energy bills and improve insulation, so of course the Government scrapped it and replaced it with the energy company obligation—little more than a hidden Tory energy tax on all consumers, irrespective of their incomes.

[Jim Shannon (Strangford) (DUP)]

In Northern Ireland we have fuel poverty levels of 35%-plus—the highest in all the United Kingdom of Great Britain and Northern Ireland. Does the hon. Gentleman agree that we need—perhaps the Minister will respond to this—a policy and a strategy to make sure that all new builds are efficient, and that for houses that need to be so there is a co-ordinated plan across the whole of the United Kingdom of Great Britain and Northern Ireland such that every council will try to achieve that?

[Steve McCabe]

I certainly agree that we need a plan that goes much wider, reaches a lot more homes, and focuses on new build.

The problem is that so successful is the direction of current Government policy that by 2017 about 200,000 homes, as opposed to 1.3 million, will be eligible for some assistance with energy efficiency measures, and the total level of investment in energy efficiency will have halved. In essence, we have ended up with a policy where only those who qualify as fuel poor can get any help to invest in energy efficiency measures. That is no doubt partly why the Committee on Climate Change recently claimed that cutting carbon emissions from the home was now a policy in reverse. Matthew Bell, its chief executive, has made it clear that the best way to reduce consumer bills and tackle climate change is to make sure that more homes are properly insulated, but instead this Government have managed to ensure that the rate of home insulation has fallen by 90%. A recent estimate shows that over the course of the last Parliament and the present one, the number of households receiving help will decline by a staggering 76%. The Government have scrapped ideas for new homes to be zero-carbon, thus, as the Chair of the Committee pointed out, ensuring that we store up additional retro-fit costs for the future.

In terms of energy savings, new technological developments, and a growth in green energy jobs, this Government’s achievement has been not to be the greenest ever but the biggest failure ever. We need a settled Government policy and an environment where businesses and consumers can plan ahead. We need a fair and simple plan that incentivises households and the rented sector to invest in home energy improvements. We would be helped in this by a signal from Government that they intend to support the Leasehold Reform (Energy Efficiency) Bill. Alas, we have a Government bereft of practical policies to meet more than half of the emissions reductions required by 2030, and many of the existing EU-linked initiatives are now in doubt because of the botched referendum. The abandonment of the carbon capture and storage initiative is just the latest in a series of U-turns by a Government who are without direction and any coherent energy policy.