John Robertson
Main Page: John Robertson (Labour - Glasgow North West)(10 years, 8 months ago)
Commons ChamberRead Full debate Read Hansard Text
Caroline Flint
Although some of the companies have reformed how they treat their customers, I am afraid that I receive information every day from members of the public including my own constituents—and also colleagues in this House who tell me about their experiences and those of their constituents—about what can only be described as sharp practices. Why should a customer who is paying a fair rate for their energy have to pay an uprated rate just to allow that money to sit in the coffers of the energy companies so they can benefit from any interest on it? That is just not fair and there is still a huge job of work to be done.
John Robertson (Glasgow North West) (Lab)
Some 56% of people are saying they have cut back on their use of electricity and gas yet their bills are going up. They ask, “What is the point of the green deal, when it does not matter how much I save because prices are going up anyway?” No wonder nobody wants to know about the Government’s green deal.
Caroline Flint
My hon. Friend is right, and that lack of confidence and trust in the market and how it operates is at the heart of our motion.
I want to tackle this issue head-on by turning to the question of the retail energy market. It is nearly a year ago now that the Prime Minister promised to force the energy companies, by law, to put all their customers on the cheapest tariff. Let me remind the House of exactly what the Prime Minister said on 17 October last year:
“we will be legislating so that energy companies have to give the lowest tariff to their customers”.—[Official Report, 17 October 2012; Vol. 551, c. 316.]
He reaffirmed his proposal at Prime Minister’s questions earlier today, but the details show that it will not in fact apply to all customers; it will apply only to people on closed or dead tariffs, which is a tiny fraction of consumers as a whole.
Given the crucial difference between what the Prime Minister promised and what the proposals entail, it is reasonable to ask exactly how many people will benefit. Since then, I have asked one urgent question, six oral questions in the House and six written parliamentary questions to get to the bottom of this, but every time the Government have refused to answer.
This is meant to be their core offer to consumers, yet the Government cannot even tell me how many people will be moved to a better deal, when that will happen or how much they will expect to save. So I ask the Secretary of State again today: how many people will the energy companies be forced to move to the cheapest deal? Why is his Department so far refusing to answer my freedom of information request on this issue? Why has so much time and so many resources been wasted trying to shore up a policy announcement made off the cuff?
The sad thing is that there is agreement across the House and, to its credit, within industry that the proliferation of tariffs in the past few years has hindered, rather than helped, consumer choice and competition. Instead of focusing on that, the Department has wasted a year trying to dig the Prime Minister out of a policy hole entirely of his own making, creating unnecessary confusion for the public.
Mr Davey
On the Committee’s proposals about whether Ofgem should pursue the BDO recommendations on accounting transparency, the right hon. Lady will have to wait until we publish our response to the Committee. However, I disagree strongly with her that Ofgem is not using its powers. It is certainly using its powers under us, which is why we have the retail market review delivering the tariff simplification that Labour failed to introduce, and why we are seeing reform proposals for the wholesale market, which Labour failed to do.
John Robertson
This reinvention of history is an absolute disgrace and you do this place no favours whatsoever. You have stated in front of the Committee that Ofgem is not doing the job it should be doing, and said that you were going to do something about it. We are still waiting.
Mr Davey
I always find the hon. Gentleman to be an interesting colleague when I come before the Committee, and with interesting questions. We will respond to the Committee’s report. Of course it is right for colleagues to have criticisms of Ofgem, but the question is what they are going to do about it. Do they want to spend lots of time abolishing the regulator completely, or do they want what we want, which is to make it stronger and give it tougher powers? We have a much better record. We have not just relied on the regulator. Through our collective switching pilot, which we will report on in the autumn, we are trying new ways to help get customers and consumers—especially the most vulnerable consumers—a better deal.
John Robertson (Glasgow North West) (Lab)
It is a pleasure to be in the Chamber under your leadership, Mr Deputy Speaker. I apologise for using the dreaded “you” word earlier. Of course, I was not referring to you, but addressing the Secretary of State.
I have never been as disgusted by a contribution from a member of the Opposition as I have today—[Laughter.] I meant to say “member of the Government.” I do not think this is funny; it is a serious subject. We are talking about people’s lives. If hon. Members want to have a laugh, they can go somewhere else and do it.
The Secretary of State and the Minister of State, Department of Energy and Climate Change, the right hon. Member for Bexhill and Battle (Gregory Barker), know that the Secretary of State’s performance broke something the House used to have—hon. Members working together on energy. We know there are problems, many of which are outwith our control. The previous Government had the support of Her Majesty’s Opposition. He was not a member of that Government.
The Opposition have supported the Government in trying to move forward to ensure that the lights stay on and that people have the money to switch their lights and heating on, and to cook their food. However, come this winter, people in my constituency will have to decide whether to eat, heat or pay their rent. Government Members might think that is funny, but I do not. It is important and we should work together to ensure that people do not have to make such decisions, and to ensure that they can eat, heat and pay their rent. Sadly, I do not believe that will be the case.
The Government’s report—the Hills report—said that tens of thousands of people will die because of Government policy, no matter which party was in government. The fact is that the current Government asked for the report, but they have done virtually nothing about trying to relieve people’s problems in paying for their heating, eating and rent. I want to work with the Government to ensure that people do not have those problems, but on today’s performance, it would appear that the Government want to draw battle lines because there will be an election in a few years’ time. So be it. The Secretary of State’s performance today was a disgrace. He had no ideas. All he could talk about was what happened 10 years ago—he could not look forward to what his Government should be doing or ask the Opposition to help them to get there. He did not want to do it. I am sorry about that, but if we want to fight about where we are going, let’s do it.
I must tell the Secretary of State—he knows—that the Energy and Climate Change Committee’s report said that there was a lack of transparency in the Government and Ofgem. I do not necessarily want to get rid of Ofgem. It has a job to do, but I want it to be able to do its job without being frightened. I see a bullying tactic from the Secretary of State, which leads me to believe that there is a good reason why Ofgem has not been doing its job properly and not doing what it should be doing. It is too frightened of repercussions from the Government. I hope I am wrong, but I see something today that I did not think I would see from a Secretary of State. To treat my right hon. Friend the Member for Don Valley (Caroline Flint) as he did was, to say the very least, not gentlemanly. At least he could pay credit to the fact that the Opposition have put ideas forward. He might not like the ideas, but the fact is that ideas were put forward. If he wants to stymie them and ensure that we have a shouting match between Government and Opposition, he has drawn the battle lines.
Mr Alan Reid (Argyll and Bute) (LD)
The hon. Gentleman is right that the Opposition should put forward ideas. One of their ideas in the motion is to reintroduce the pool, which Labour abolished in government. What is different about the arrangements Labour proposes from the ones it abolished 12 years ago?
John Robertson
That is a ludicrous question. Way back then, things were completely different. Prices for electricity and gas were so much lower than they are today. We have moved on. We talked about it back then, but nobody listened. We knew there would be a shortage in delivery of electricity and gas, and that we would run out of North sea gas and oil, but we did not look at how to go forward. We understood that we were not going to build any nuclear power stations, but we have gone back on that as well, because we have realised that we have to have a base load so that people can keep their lights on. If we do not do that, business will go down the tubes, people will not be able to heat their houses and we will have neglected the job that we were put here to do—to look after the people of this country.
It is important that we work together to make sure that we build these power stations. The hon. Member for Brighton, Pavilion (Caroline Lucas), who is no longer in her place, does not like nuclear power stations, and nor does the hon. Member for Angus (Mr Weir), but it is important that we have them. We must have a power base that ensures that we can keep the country running, with a security of supply that we can depend on.
Charles Hendry (Wealden) (Con)
Does the hon. Gentleman therefore regret the years from 1997 to 2007 when nuclear was off the agenda completely, and would we be in a better position if nuclear had been able to advance during that period?
John Robertson
The short answer is yes, I do regret it. But I also regret what happened before that, because in the 1980s and early 1990s we knew that we had to build new power stations, but we did not do a lot about it. We built some gas-powered stations, but we knew that we would run out of gas unless we went to the middle east or Africa to get it. The one issue that struck home with everyone was security of supply. When Tony Blair stood up and said that in this Chamber, people asked, “What has happened? He has changed his mind.” But he understood that something had happened in the world that meant that we had to ensure we had security of supply.
The hon. Gentleman did an excellent job as a Minister, but he will remember that it was support from him and his colleagues that helped us to get to where we are today. The Secretary of State would not be a Minister if it had not been for what happened in those days because there would not have been an Energy and Climate Change Department or Committee. We did that together, and we have to go forward together. I hate this fighting and having a go at each other—“Your policy was wrong, our policy is right.” That is a portrayal of history that I do not recognise. What was done at the time was right for the time. We have moved on and we need to make things better.
If the Secretary of State wants my support, he needs to have a better attitude. If he wants my help, he should at least listen to what we have to say. He does not have to follow it, but he should at least look as if he is listening.
Albert Owen
I am grateful to the hon. Gentleman; I am sticking to the report and the evidence base that we were given.
Our report identified—this is important—poor communications between the energy companies and the public. It is fair to say that some companies are now getting it, because of strong lobbying from consumer groups and the work done by the Select Committee in identifying the complexity of tariffs and how many there are.
John Robertson
Was not part of the problem the fact that we did not know how much profit was made on the generation side? It was estimated to be something like 20% of turnover, which, when added to the profits that everyone has been talking about, starts to become excessive. The other thing that was wrong was that the companies refused to turn over their books, so unless someone had a good degree in accountancy, they would not know where the money was spent.
Albert Owen
My hon. Friend is absolutely right; it was complex. I recall a conversation that I had with the new chief executive of E.ON, who has a master’s degree in mathematics. He told me—he has also said this in public—that he could not understand an E.ON bill because it was so complex. He has now taken steps to simplify the bills.
Energy markets are not delivering the low, stable prices that we were promised at the time of privatisation. The short-term profits that are said to have resulted from the privatisation of gas have meant long-term pain for many of our constituents, who have been paying higher prices for their gas and electricity in recent years. Switching is not an option for everyone, and it has not been taken up by the majority of people. We are paying high prices for our gas and electricity and the switching of tariffs is not working.
There is also mistrust between the public and the energy companies, as we have discussed in a number of debates. It remains a concern that prices are rising quickly, and that the price to the consumer goes up considerably when the global price of oil increases but does not go down nearly so quickly when the global price is reduced. I believe that there is consensus between the Government and the Opposition that we should examine that issue with the regulator, to establish how best to deal with it. Ofgem has done some good work on that already. However, I have to take issue with the Secretary of State’s comment that he was putting pressure on the regulator and that all the good results were coming from that Government pressure. When things do not work out quite so well for the consumer, the regulator is described as independent. The Secretary of State cannot have it both ways. The regulator is independent, and I believe that it needs more teeth. It also needs to use some of the powers that it already has.
In the time that I have left, I want to talk about the possibility of giving Ofgem a wider remit in regard to people who are not on mains gas, of whom there is a considerable number. I have been campaigning for them since about 2007, when gas prices became a real issue. The prices went up, but for those who are not on the grid, they went up considerably more. That has become a huge issue. The alternatives to mains gas are oil and other forms of gas.