Energy Price Freeze

Debate between Tom Greatrex and Duncan Hames

Wednesday 6th November 2013 Commons Chamber

[Tom Greatrex]

I will not, because I am short of time, and I need to be able to respond to comments from other hon. Members.

My hon. Friend the Member for Glasgow Central (Anas Sarwar) highlighted a reluctance to address these issues and to challenge the fact that they exist in Edinburgh as much as in Whitehall. The hon. Member for Wealden referred to the rather ridiculous claims about blackouts, which were made immediately after the proposals were first outlined, and he will be interested to know that every single energy company that I have since spoken to has dissociated itself from those comments made by the trade body and, indeed, from the comments of the Secretary of State and the Minister on Twitter immediately afterwards. I am sure that he will heed the warning on Twitter that the Prime Minister issued some months ago.

The problem also exists in Edinburgh, where the only person sticking with those comments and repeating the ridiculous comparison with California in 2000 is the Scottish National party energy spokesman in the Scottish Parliament. We will stand up to those issues, because we want a market that works. My hon. Friend and constituency neighbour, the Member for Lanark and Hamilton East (Mr Hood), made an important point about the duties of government and discussed the legacy of the former Prime Minister, Margaret Thatcher. Another aspect of her legacy, Sir John Major, said a couple of weeks ago that if markets did not work and companies behaved badly, Governments stepped in. That is precisely what we are outlining in the policies that we are debating.

Another legacy of John Major was the system where the companies could integrate. Government Members referred to Labour’s big six. The Minister, the right hon. Member for Sevenoaks—I know that he was on a career break at the time, but was a Minister in John Major’s Government and has been around for a considerable time—will know that the first of those acquisitions was Scottish Power acquiring Manweb in 1995. The hon. Member for Warrington South (David Mowat), who is unable to be in his place, could not describe, when challenged, why prices have gone up. My hon. Friend the Member for Blaydon (Mr Anderson) made a related point. That is precisely why we need transparency in the market.

When SSE put up its prices recently, it tried to quantify the cause of the increase. It attributed 4% to wholesale costs, 10% to network costs, 13% to Government policy costs, 8% to VAT, which adds up to 80%, leaving 20%. That additional 20%, which was not in SSE’s press statement but was in the small print and in conversations with the markets afterwards, was to increase its profit margin. That is what is happening in the market, and not just in the case of SSE—npower did something similar. I recommend that Members who want to see just how complicated and opaque the market is read the most recent edition of Private Eye, in the City column, about the structures around Centrica and particularly the trading arm of Centrica and the way in which profits are moved around different parts of what is essentially the same company.

My hon. Friend the Member for Ynys Môn (Albert Owen), a distinguished member of the Select Committee, made the important point about ensuring that off-grid customers are protected. The hon. Member for Wells (Tessa Munt) repeated the comment from First Utility, but she neglected to mention that when interviewed on “You and Yours” a couple of weeks ago, Ian McCaig, the chief executive of First Utility, said that the most important reform needed was openness and transparency in the market. That is exactly the reform that we propose in the motion before the House.

My right hon. Friend the Member for Coatbridge, Chryston and Bellshill (Mr Clarke) has a distinguished record in the House of campaigning for the fuel poor, and indicated how long he has been campaigning. My hon. Friend the Member for Rochdale (Simon Danczuk), as well as mentioning some of the issues that he has encountered in dealing with energy companies, made the important point that the proposed measure would save small businesses £5,500 and medium-sized businesses £32,900 based on their previous bills.

The hon. Member for Angus (Mr Weir) talked about the reviews. He will know that the one announced by the Government is the 18th review since 2001. He spoke about the measures announced at the Scottish National party conference for a separate Scotland to reduce bills by £70 by moving ECO from consumer bills on to the tax bill. He neglected to mention that the pooled support for renewable energy for Scotland, which is paid across the whole of Britain, would not exist in the same form. Scotland has 8% of the population and more than a third of that support, which is spread across all the bill payers in Britain, as he well knows.

The hon. Member for Chippenham (Duncan Hames) asked me a number of questions, first about how the measures would be introduced and whether emergency legislation would be used. I am not sure whether he was present for the speech from my right hon. Friend the Member for Don Valley at the start of the debate. She made it clear that we would introduce specific legislation quickly—he might call it rapid or emergency legislation—to do one simple thing: to enable the Secretary of State for a fixed period to amend the licence conditions to allow the freeze to take place while we make the wider reforms.

[Duncan Hames]

rose—

[Tom Greatrex]

I shall respond to the other points that the hon. Gentleman made during the debate, and I am conscious of time. He referred to the issues for small companies. I say again that every small supplier that I have spoken to in the past few weeks has made it clear that what is needed most of all is an open, fair and transparent market where energy is traded openly and suppliers can compete and get a better share of that market in order to build their customer base. That is what Labour’s reforms would deliver. The price freeze would enable those reforms to be put in place.

My hon. Friend the Member for Southampton, Test (Dr Whitehead) shot a number of ducks and set out cogently and coherently the point of resetting the market. With his expertise and as a member of the Select Committee and the Bill Committee, he will know that we have been talking about these issues for a considerable time, and to suggest that they are something new or emerging today, as the Secretary of State implied, is utter nonsense.

My hon. Friend the Member for Oldham East and Saddleworth (Debbie Abrahams) talked about the impact on health. My hon. Friend the Member for Chesterfield (Toby Perkins) referred to the Prime Minister’s announcement on green levies, The Prime Minister made his announcement. The Energy Minister, who is in his place, told the Environmental Audit Committee a couple of weeks ago that the Government were looking at each of those levies. I asked a parliamentary question on which levies they were looking at and received a response today from the Secretary of State. It stated that they are looking at investment incentives, but not for the renewables obligation, contracts for difference or feed-in tariffs. The Prime Minister said earlier today that they were looking at every subsidy and every levy. There is complete confusion at the heart of the Government about what is and is not in scope for the review. If they are concerned about the impact on confidence and investment, they need to look at the shambles of their own policy over the past couple of weeks.

My hon. Friend the Member for Washington and Sunderland West (Mrs Hodgson) made a heartfelt speech detailing her own experience of growing up in fuel poverty and her concerns about her constituents and others in the same situation. My hon. Friend the Member for Blaydon (Mr Anderson) made a similar case. My hon. Friend the Member for Edinburgh North and Leith (Mark Lazarowicz) also dealt with the reality of the cost of living crisis, of which energy costs are just one aspect. My hon. Friend the Member for Wansbeck (Ian Lavery) talked about the issues facing ordinary people. All those contributions made it clear why we need complete change in the market, and we need a price freeze to enable that change.

The motion before us is about a price freeze, but it is also about ensuring that there is a level playing field for other companies and that companies cannot abuse their position in future. It is about fixing a broken market and standing up for consumers and businesses. It is about making the market fair, clear and transparent in the interests of consumers, industry and the country. I commend the motion to the House.

Disability Benefits and Social Care

Debate between Tom Greatrex and Duncan Hames

Wednesday 20th June 2012 Commons Chamber

[Duncan Hames (Chippenham) (LD)]

We have certainly heard strong words in the debate, but a careful study of the motion suggests that it tells us about those areas on which the Opposition agree with the Government. It says that DLA “needs to be reformed” and that the work capability assessment, which was introduced in the final years of the Labour Government, is in “pressing need” of reform. It even suggests that the principle of the closure of Remploy factories is not in dispute, because I thought that the shadow Secretary of State, the right hon. Member for Birmingham, Hodge Hill (Mr Byrne), was asking whether now is the right time. There is also agreement throughout the House about the importance of recognising the contribution made by carers, and I suggest that such recognition is reflected by the £400 million that the Government found to support respite breaks for carers. We should clarify where there are points of disagreement.

All parties can agree that the Government’s aim should be to create a system that ensures that every disabled person is treated with dignity and respect, and that they have access to the services and support that they need to fulfil their potential. That is reflected in the aim in the Government’s business plan, although we do not know what change of approach that represents. Despite difficult economic times, that remains the Government’s intention, and Liberal Democrats have already made a difference to the policies that can help to make that a reality. Although we support a cap on the total amount of benefits that a household can receive, we considered it vital that the cap was set at the right level, to protect those who are unable to work through disability or ill health. That is why Liberal Democrats welcomed the original exemption of DLA from the cap, but pressed further to exempt all those in the support group of employment support allowance as well, to which the Government agreed.

Liberal Democrats in the Lords amended the qualifying periods for the personal independence payment to match the existing qualifying periods for disability living allowance. This should ensure that those who need support up front, perhaps to deal with the costs of a new condition, will get that support quickly. However, the principle remains that personal independence payments are a long-term benefit. On the Floor of the House I repeatedly highlighted a campaign in support of disability charities to get the Government to rethink—and ultimately abandon—the proposal to remove the mobility component from the disability living allowance of local authority-funded care home residents.

There is much on which we have been able to agree, but there is certainly still more work to do, especially on getting the work capability assessment right. Liberal Democrats support the plans of the independent reviewer, Professor Harrington, to develop new, evidence-based descriptors, covering chronic fatigue and pain, which would help better assess those with fluctuating conditions. During the exchanges earlier in the debate, I was amazed at the refusal to acknowledge that the work capability assessment as it was operating at the start of this Government barely two years ago was that created by the Labour Government. It relied too heavily on the contracted-out, face-to-face assessment performed by Atos, with decision makers just rubber-stamping a decision that Atos had made. I therefore welcome the Harrington proposals to give DWP decision makers more flexibility to look at evidence other than the Atos assessment in coming to their decisions.

[Tom Greatrex]

Will the hon. Gentleman give way?

[Duncan Hames]

I will happily give way because I hope we can at least agree that what was put in place by the previous Government was unacceptable and, in the words of the shadow Secretary of State, needed to be adapted.

[Tom Greatrex]

I am sure the hon. Gentleman will take the opportunity to remind the House that after the work of the Select Committee and after the pilot areas had highlighted a number of flaws in the system, it was his Government who put in place the migration of people on incapacity benefit to ESA through the work capability assessment. If the Government were so concerned about getting it right, perhaps it would have been a better course to make the changes to the system before starting the migration.

[Duncan Hames]

I have read speeches in Hansard from before I was elected when colleagues of mine pleaded with the previous Government to make changes to the work capability assessment that they were introducing. On the timing of those changes, they should have been made even before the present Government came to office.

I turn to the matter of Remploy. [Interruption.] Changes are being made now. It is worth noting—