Luciana Berger
Main Page: Luciana Berger (Liberal Democrat - Liverpool, Wavertree)(10 years, 7 months ago)
Commons ChamberRead Full debate Read Hansard Text
Mr Davey
No, I want to make some progress. Fuel poverty has been rightly mentioned, and ours is a comprehensive approach on which we have consulted fully and on which we will continue to work with all stakeholders. Having published our fuel poverty strategic framework, we are planning to publish our full fuel poverty strategy early next year, and it will be a marked improvement on the past for several reasons.
Luciana Berger (Liverpool, Wavertree) (Lab/Co-op)
Will the right hon. Gentleman give way?
Luciana Berger
This House was anticipating the fuel poverty strategy by the end of this year. Will the Secretary of State confirm what he just said, which was that we should now expect it to be delayed into the new year?
Mr Davey
I said it would be published early in the new year. First, with our low-income, high-cost measure, and also by measuring the depth of fuel poverty—something never done by the previous Government—we will have a much better handle on this worrying and difficult problem. Secondly, by linking fuel poverty far more closely to the energy efficiency of homes of those in fuel poverty, we will target resources better and more effectively. Thirdly, I want to look at new ways to ensure fuel poverty is prioritised, for example by examining and emphasising links with poor health.
To me the evidence is clear. If we beat fuel poverty, we can improve the health of hundreds of thousands of our citizens, and we will continue to give people direct help with their bills, whether through our warm home discount, the winter fuel allowance, or our higher cold weather payments. We want to get real help—money off—for the most vulnerable, and we want to do more for energy efficiency and help people save energy, save money and keep warm.
I am pleased with the huge and maintained demand for green deal assessments, with nearly 60,000 completed. I am also pleased to see how the supply chain continues to grow, and to hear about new schemes that new players continue to launch. Along with the success of the energy company obligation, with almost 150,000 installations completed, I believe the infant market of the green deal will grow and grow and bring the major change we want. With our emphasis on competition and helping vulnerable consumers directly, and with our energy efficiency policies, the coalition is delivering for people in difficult times. Labour failed to deliver in easy times.
Luciana Berger (Liverpool, Wavertree) (Lab/Co-op)
This has been a very important debate at a time when a cost-of-living crisis is hitting households all over our country. There have been many eloquent and powerful contributions and what we have heard paints a damning picture. We have heard that energy bills are soaring, profits for the big energy companies are sky-rocketing, energy efficiency is stalling and fuel poverty is deepening.
The Secretary of State, who, sadly, is no longer in his place, was more concerned with defending Ofgem and the energy companies, which is reflective of an out-of-touch Government who are failing to stand up for hard-working families who are struggling up and down this country.
I am not surprised that so many hon. Members have spoken about how their constituents are struggling to keep up with spiralling energy costs. My hon. Friend the Member for Glasgow North West (John Robertson) spoke passionately about the choice some of his constituents might face between heating, eating and paying rent. The hon. Member for Sherwood (Mr Spencer) mentioned his constituents’ anxiety when an energy bill drops through their letter box.
The average dual fuel bill has shot up by more than £300 since the Prime Minister entered Downing street. Back in May 2010 a typical household paid £1,105 a year; the figure now stands at £1,420—a 29% increase in a little over three years. The cost of gas and electricity is a serious concern for too many families, regardless of whether or not they are technically in fuel poverty. According to the consumer watchdog Which? 80% of people are worried about the rising cost of energy and rank it among their top financial headaches.
As people struggle to heat their homes, the energy giants are reaping ever greater profits. We saw over the summer how the big six energy companies have enjoyed a windfall of £3.3 billion in additional profits over the past three years, on top of the £2.2 billion profits they were already making. Of course, companies are allowed to make a profit. As the shadow Energy Secretary, my right hon. Friend the Member for Don Valley (Caroline Flint), said, the energy industry plays a tremendous and vital role in our economy and in keeping the lights on, but that does not mean that we should ignore the need to reform how our energy market works. We need real reform to break the dominance of the energy giants, create transparency and openness, and protect the public from being ripped off.
As my hon. Friend the Member for Ynys Môn (Albert Owen) said, it is a real problem that we do not know exactly what the energy companies are making in profits. My right hon. Friend the Member for Don Valley referred to certain reports that show that the profits made on the supply side and those made on the generation side are massively different and we do not always see what they are.
The second of two Energy Bills is currently making its way through Parliament without any significant Government proposals to help bill payers. All that has been offered is a broken promise, repeated by the Prime Minister today, to put everyone on the cheapest tariff, which has proved impossible to deliver. When my right hon. Friend raised this issue in her speech, we heard lots of chuntering from Government Front Benchers but no interventions to share with the House exactly what the Government are doing. It simply will not pass as a real answer for how to reform our energy market. Even the cheapest tariff in an uncompetitive market will not be a good deal.
By contrast, today we have heard loudly and clearly what a Labour Government would do to fix our energy market. There are three key differences. We would open up the market and make it more transparent, and we would require energy companies to pool the power they generate and make it available to any retailer.
At this point it is important that I highlight the crucial differences between a pool that we would seek to introduce and that which was in operation previously. When the old pool was put in place, there were just two generators, which meant that they were able to exert disproportionate influence on the pool price. Today there are many more generators, so it would be much more difficult to do that. The old pool was also a one-way pool, which meant that only generators could place bids for how much they were prepared to sell their power for.
There is no reason why a new pool could not be a two-way pool, whereby both generators and suppliers place bids. That is how the Nord Pool works. The UK currently has two power exchanges where trades can take place: N2PX and APX. The volumes that are traded on the day-ahead exchanges are already increasing. If all generators and suppliers were required to trade 100% of their output and supply via those exchanges, it would have the same effect as introducing a pool.
We need a tough new watchdog that has the power to pass on price cuts to consumers when the wholesale cost of energy falls. That has been underlined by the report of the Energy and Climate Change Committee, “Energy Prices, Profits and Poverty”, which states clearly that “Ofgem is failing consumers”. It also states that it has proved
“unwilling to use the teeth it has.”
As my hon. Friend the Member for Ynys Môn highlighted, there are many problems for customers who are off grid. We believe that the new regulator should assume responsibility for off-grid customers.
The Select Committee report also points out that
“rising prices are exacerbating fuel poverty.”
Under the Government’s new definition, there are still nearly 2.4 million fuel-poor households. According to the Government’s own figures that were published last month, the gap between people’s fuel bills and what they can afford to pay has grown by £200 million over the past two years. That is an average of £494 for households that are struggling to meet their energy costs.
The hon. Member for Angus (Mr Weir) highlighted the problems for customers who have prepayment meters and the hon. Member for Strangford (Jim Shannon) highlighted the problems faced by his constituents, particularly older people, and the increase in excess winter deaths.
Ministers have admitted that the number of people in fuel poverty is expected to rise over the next two years. That is why it is such a scandal that the Government have halved the support for people in fuel poverty. The Labour party would help those who are most in need. That is why we would require companies to put all pensioners who are aged over 75 on to the cheapest tariff. That is the right thing to do because it is the oldest in our society who are the most vulnerable in cold winters.
We all know that if we get household energy efficiency right, it can reduce energy costs, create thousands of jobs and cut carbon emissions. However, the Government’s efforts to make our homes more energy-efficient are failing. I was not reassured by what the Secretary of State reportedly said at an event in the House last night. He told an audience that he knew the green deal would work because he could feel it in his bones. I do not know whether Members can recall any other Minister extolling the virtues of bones-based policy making, but the Opposition prefer to deal with the facts.
The most recent figures show that just 132 households have signed on the dotted line for a green deal plan since the scheme went live. That is disappointing enough, but the real wake-up call for Ministers should be the number of green deal assessments. The Opposition desperately want to see better insulated homes in our country. As my hon. Friend the Member for Edinburgh East (Sheila Gilmore) said, the green deal is not good enough. The green deal will not achieve the ambition that we all want to see unless the Government stop being so complacent, listen to what industry leaders are saying and tackle the problems with the scheme.
In conclusion, this is a motion for consumers. It speaks to the concerns of families across our country and clearly lays out what action we should be taking to make energy more affordable. It stands up for the people this Government like to claim they are on the side of. Today, they have an opportunity to prove it. I urge the Government and all Members to support our motion, and I commend it to the House.
Gregory Barker
The hon. Lady was not actually here for the debate. We are taking action to give more teeth to the regulator and compensate energy consumers who have been badly treated. We have embarked on radical market reform to unleash investment in modern clean energy, building our energy security that was so perilously ignored by Labour. We are also offering immediate help for our constituents. For example, Labour put the whole cost of the renewable heat incentive on to consumer bills. We have removed it, saving consumers £120 million a year collectively. Labour refused to cut solar feed-in tariffs, despite fixing them far too high. We took the tough decision to cut those tariffs. We were right, they were wrong. Solar deployment is up, costs are coming down, and the consumer is better off.
Luciana Berger
Will the Minister tell the House what the additional amount will be on all our bills from the Government’s miscalculation of the energy company obligation?
Gregory Barker
We have not miscalculated the ECO. It is coming very close indeed to the impact assessment that we published last year. I am happy to tell the House that costs of the ECO are continuing to come down, and we are seeing a number of technologies deployed far more cost effectively than under the poor Warm Front scheme that the Labour party put together, and which so many Members from around the House wrote to me to complain about. We are doing other things to help consumers. Our warm home discount means £135 this winter for more than 2 million poorer households.