ECO4 Scheme Redress

Wendy Chamberlain Excerpts

Wednesday 2nd July 2025 Westminster Hall

[Wendy Chamberlain (North East Fife) (LD)]

I beg to move,

That this House has considered the matter of redress under the ECO 4 scheme.

It is a pleasure to serve under your chairpersonship, Sir John. This debate is about a lot of things. It is about the need to retrofit UK homes to improve their fuel efficiency, training the future workforce and the consumer protection landscape, but it is also about the Government taking responsibility for policy failures. Most importantly, it is about people. Therefore, before I cover the issues with the ECO4—energy company obligation 4—scheme and the wider consumer protection landscape, I want to set out the experience of my constituent, Jackie.

Jackie and her husband live in a gable end cottage. They have worked hard and done well, and are meant to be enjoying their retirement, but they are not. It all started to go wrong just more than a year ago, when, out of curiosity, they filled in a small quiz about rural homeowners without central heating on the Energy Advice Helpline website. They were contacted by a representative by phone and email very quickly, and found themselves put into a pipeline for works to be carried out. They described that period to my team as dizzying and said that they felt under pressure.

Jackie and her husband had checked that the Energy Advice Helpline seemed to be a genuine not-for-profit advice service, but they had not been advised that the project had been given to a company called Central Eco Solutions. Now, some 12 months later, we have just found out that there was a further middle company—a surveyor based in Leeds, who my constituents had never spoken to until yesterday. The workflow that he described was that the Energy Advice Helpline adviser supplied work to him, and then he supplied work to installers.

The work was carried out hurriedly in three weeks at the end of July and start of August last year. Alarmed at the poor quality of work being done in their property, Jackie and her husband started questioning the contractors about who was employing them and what instructions they had been given. It was only at that stage that they found out that Central Eco Solutions was involved. There was no project management, contract or design proposals, and when they asked for technical surveys, they were carried out by someone who was not a surveyor.

Problems became obvious with the works immediately. No care was taken with the preparation. Floors were taken up and cupboards removed without notice. They described a small bookcase being ripped out with a crowbar, and the promises of it being replaced transpired to be completely false. The insulation and plastering had to be redone three times. The team attempted to insulate around a radiator, until they were stopped, but they did manage to insulate over a double socket, making it unusable. One insulation wall was put in at a very non-vertical angle. A joiner was sent to repair the woodwork, but he was instructed only to use MDF in place of pre-existing solid wood, and clearly, did not have the skillset to do the job in hand.

Those are just the snags. The air source heat pump was originally installed on the outside of the gable wall, causing such bad noise and vibration in two bedrooms that they became unusable. Jackie investigated and found it had been bolted directly to the wall, whereas others she had seen were bedded on insulation. When she suggested that as a remedy, the heat pump was removed and placed apart from the building, but pipework was left running at waist height over the pathway to the garden. Most of the snags have still not been resolved. There are uncovered pipes, ruined woodwork, excess pipes creating energy waste, and a slanting kitchen wall.

My constituents have had a terrible year dealing with these issues: chasing Central Eco Solutions for the work to be finished properly, trying to find some sort of guarantee scheme, making complaints, and escalating those complaints with no clear route for doing so. They are not alone. I am telling Jackie’s story, but there are many others in North East Fife and around the country. It is not a problem with just one installation company, because I have heard cases with others; I have been contacted by people all around Great Britain since my debate went on to the Order Paper, who have named different companies that have ruined their homes and left.

This is a Government problem that must be solved. I have questioned the Minister in the House about it previously, and I think she knows that it is a Government problem because she announced in January that she would review the consumer protection landscape, particularly in relation to solid wall insulations under ECO4. However, I have had sight of a letter sent by her team in response to a complaint by a company outwith North East Fife. I was disappointed that the letter makes it clear that, as the Government do not directly fund ECO4, they do not get involved in private and contractual decisions between the parties involved.

That somewhat misses the point. ECO4 may not be taxpayer funded, but it is a Government-backed scheme. For consumers that is the same thing, because that gives the scheme a stamp of Government approval. The Government surely would not, and should not, be backing something that allows traders to carry out unreliable and unsuitable work on somebody’s property. The Government would not be backing something unless they were really sure of what it was—right? In any case, ECO4 is taxpayer funded in some ways, because it is funded by a Government-backed levy on energy customers’ bills. Just because those public funds do not go through the Treasury’s coffers does not mean that there is not a public interest in getting their use right.

I am happy to put on the record that I support ECO schemes: it is incredibly important to upgrade properties so that they are energy efficient. Our constituents need to do that to save money on their bills, and energy efficiency is a must-have in the face of a climate crisis.

[Tim Farron (Westmorland and Lonsdale) (LD)]

My hon. Friend is making an important speech. One in six properties in Cumbria is more than 100 years old. Almost all of them will be single-walled properties, which are incredibly hard to insulate. Yet the award of grants through ECO4 always tends to favour large companies, not the smaller businesses that are better able to retrofit heritage buildings. Should the Government change that so that my constituents can have warmer homes that are also cheaper to heat?

--- Later in debate ---

[Wendy Chamberlain]

I will go on to mention the particular challenge with older properties, but my hon. Friend’s example illustrates exactly what the issue is. This scheme is under the auspices of Ofgem and is funded through the Government levy on energy bills, but does not have any real oversight, so consumers end up being let down.

[Jim Shannon (Strangford) (DUP)]

I commend the hon. Lady for securing this debate. She always brings applicable issues to Westminster Hall, and today is as an example of that, with the horrific example of the almost inconceivable standard of work done to her constituent’s house.

The ECO4 scheme does not apply in Northern Ireland, where we have a fuel assistance scheme. Eligibility can be very tight and residents with more than a certain amount in their savings accounts find that they may not qualify. Does the hon. Lady agree that more could be done to loosen the rules for our elderly generation, particularly in boiler replacement or energy schemes?

[Wendy Chamberlain]

It would not be a Westminster Hall debate without an intervention from the hon. Member. He illustrates that, although this is a GB scheme and not applicable in Northern Ireland, consumers and more vulnerable residents in Northern Ireland face the same challenges regarding energy efficiency. The Government have a responsibility, working with the Northern Ireland Assembly, to improve the situation there.

We need to get this right, not just so there is faith in the schemes—although that is vital—but so works under them do not end up costing people even more in lost energy costs. It is clear that some things are going badly wrong under the ECO schemes as they stand. The Government need to address them for the remainder of properties that might do upgrades under ECO4 and for future iterations of the scheme.

First, there is a complete lack of transparency in how households are driven to the scheme and, as far as I can tell, there is no regulation either. I have talked about how Jackie and her husband felt railroaded from wondering if they would be entitled to anything for upgrades, to their home being pulled apart. She is not a vulnerable person, but she thinks that the company she dealt with was totally unprepared for being challenged over what was happening. Another constituent who had a terrible outcome under the scheme has described themselves as vulnerable and feels that the system was set up to target people like them.

As my team and I have gone further into such cases, I was surprised that more MPs are not shouting about this issue. Clearly, it is not limited just to one company or to North East Fife. When I spoke to Fuel Poverty Action this week, it told me that it is seeing only the most determined victims complaining—the rest are highly vulnerable people. From what I have seen, if companies offer to pay any compensation at all after months of fighting—even if it will not cover the cost of the remedial works—it is on the condition that all complaints be withdrawn. I therefore cannot help but wonder how many people have felt that they had to accept, and now are not in a position to tell us about their experiences.

Secondly, the funding model for ECO4 places incentives on companies to upgrade rural homes, which my hon. Friend the Member for Westmorland and Lonsdale (Tim Farron) referred to. I understand the logic of that, but rural homes, as he said, tend to be a lot older and less uniform than urban ones, so we would ideally want a proper survey to be not only done, but carried out by a specialist retrofit co-ordinator. The fact is, however, is that we do not have anywhere near enough of them.

TrustMark data indicates that although more than 2,000 individuals have completed the retrofit co-ordinator qualification, just 612 are registered with the quality mark and only 230 are actively lodging work in the data warehouse. Of the 230 active co-ordinators, around 30% are lodging the majority of those projects. That means around 66 specialists are overseeing the vast majority of retrofit works. We clearly need more, and the Government need to worry about that skills shortage.

According to Ashden, the UK will need up to 50,000 retrofit co-ordinators in coming years if we are going to reach our goals for making homes energy efficient. In the meantime, what requirements are there for works to be properly overseen by a specialist? Do contractors have to employ one and risk cutting into their margins? Are there requirements for co-ordinators to actually visit a property, provide plans, speak with the owners and review works as they go? I wonder if the mysterious middle man I mentioned earlier was a retrofit co-ordinator—it is just not clear. What is clear is that none of these steps took place in that case.

Similarly, the short-term nature of the scheme means that we are not skilling up the workforce—the plasterers, electricians and plumbers—that we need to do these works. ECO4 is the longest iteration of the schemes and has been running for almost four years, but it is due to close next spring, and we still do not know what will replace it. Short schemes with short-notice changes do not allow businesses to invest in training or properly plan for the future. Even for the best-intentioned companies and tradespeople, that is not commercially viable. That was all underlined by evidence from across the sector in the recent Energy Security and Net Zero Committee report. The industry needs a 10-year plan so that it can invest in upskilling, take on apprenticeships knowing there will be work for them after their training, and be prepared to take on the challenge of making our homes future-proof.

Finally on ECO4, there desperately needs to be some clarity over how works are certified and payments are made. These are not just individual contractual disputes; the fact that Ofgem is administering the scheme tells a very different story. As I understand it, to get paid, an installer needs to register the works with TrustMark, providing photos, energy performance certificate ratings and so on. That is then validated before Ofgem releases the funds.

Considering the hundreds, if not thousands, of homes being damaged around the country, what precise validation is happening? Is money being released for those ruined homes? What requirements are there on traders not just to say, “Sure, we installed a heat pump,” but to actually prove they have put a home back to the way it was? Where else is the money going in the supply line of referrals that I talked about earlier? Who is getting paid, by whom and for what?

I have talked a lot about ECO4, but I want to touch briefly on the wider consumer protection landscape because, now that things have gone wrong, that is where my constituents and many others are battling. I do not think it is controversial to say that it is a bit of a mess. The Competition and Markets Authority confirmed that in its 2023 report on consumer protection in green heating and insulation sector. It was reiterated by Citizens Advice in its “Hitting a Wall” report last year, and again by the ESNZ Committee in its “Retrofitting homes for net zero” report in spring.

I am aware—as I am sure the Minister will reference—that the Government are currently considering responses to a consultation on requiring the microgeneration certification scheme to be the sole certification scheme for clean heat installations. Having seen constituents, and my caseworkers on their behalf, battle through a maze of different accreditation and oversight bodies to try to find someone to take responsibility for this work, a single body seems incredibly sensible, but I still have some questions.

How would that one body sit alongside TrustMark and Ofgem? Would it replace TrustMark and, if so, how would it be better equipped to accredit and oversee retrofit contractors? Would it solve the problem of traders being able to say they are accredited, and showing that they are accredited, when complaints have already started coming in? At the moment, it is far too easy for them to chop and change logos, or to continue to display a logo that they should not be able to. How do we make that new, single body sufficiently powerful and reactive so that it can be trusted by consumers?

Policy specialists recently suggested to me that local authorities could be trusted to keep a list of accredited local traders. I had to tell them that some already do. Indeed, in North East Fife, a contractor just told constituents that they were not displayed yet due to a delay in the application process. That is very believable, given how stretched local government is.

What happens to consumers when their homes are left ruined, with works poorly carried out, and the companies have lied about being certified or have now dissolved and vanished? What will happen to people stuck in the original system, whose works were carried out under the current failing scheme, who are being pushed from pillar to post with no end point in sight? Those are the experiences of my constituents and many others. To keep fighting for someone to be on their side is breaking them. Where is their solution?

Failures in consumer protection clearly go beyond the ECO4 scheme, but there are particular problems for consumers funded via ECO4. So many people, often vulnerable, are pushed into having work done, and the nature of the schemes increases the chances of being allocated an unskilled or rogue trader. Some of the people I have spoken to in the run-up to today have said that this is a scandal that no one takes responsibility for, and they are very concerned about speaking out about it. I hope that the Minister will address my concerns this morning.

[Sir John Hayes (in the Chair)]

I remind hon. Members that the Member in charge does not have the opportunity to wind up the debate. I call the Under-Secretary of State for Energy Security and Net Zero.

[The Parliamentary Under-Secretary of State for Energy Security and Net Zero (Miatta Fahnbulleh)]

It is a pleasure to serve under your chairmanship, Sir John. I thank the hon. Member for North East Fife (Wendy Chamberlain) for securing this important debate and shining a light on the problem, which I agree is systemic, and also for sharing the case of her constituent, Jackie, which is both worrying and heartbreaking. I want to reaffirm the Government’s unwavering commitment to driving up standards—we know we must do this—and to strengthening consumer protection and rebuilding public trust in home upgrades.

On 23 January I informed the House of the discovery of widespread non-compliance in the insulation of solid wall insulation under the ECO4 and Great British insulation scheme. I am clear that blameless families have fallen victim to work that is not up to standard and which, if untreated, could lead to chronic issues of damp and mould spoiling their homes. This, for me, was a wake-up call and clearly shows that the system needs reform. Since then, we have taken clear and co-ordinated action to address the issues and protect affected households. I will set out the steps we have taken.

As I set out in my statement to the House in January, as soon as my Department was made aware of the issues we worked at pace to establish an expanded programme of checks, which we have asked Ofgem to oversee. I am pleased to report that those checks have progressed quickly; where issues have been identified they are already being resolved. I encourage all households who are contacted to have an audit on their property to take up those checks, even if they do not think there is a problem. We are building up a comprehensive picture of the scale and size of the problem and I will update the House in due course.

Our immediate priority was to protect consumers. Alongside the ongoing checks, we are implementing a comprehensive plan to remedy poor quality installations in accordance with the required standards. Where substandard work is identified, we have been clear that it is the installer’s responsibility to put it right at no cost to the household. Some 90% of the installations identified as not being up to standard have already been remediated, I am glad to say. We will continue to apply pressure on installers to take responsibility to fix the issues and not put the burden on individual consumers. If Jackie is struggling to get the system to respond in the way that it should, I will be happy for her to meet me and for us to take up that specific case.

Beyond energy efficiency measures, we are also verifying the quality of installations of two microgeneration technologies—heat pumps and solar panels—that were installed under ECO4. Installers use the publicly available specification standard for energy efficiency, and a standard set by the microgeneration certification scheme for heat pumps and solar. The MCS has been carrying out additional site audits of the microgeneration installations. So far, we have not seen concerning evidence of consumer detriment, but we are completing further checks before we can be assured that there are no systemic problems in the installation of microgeneration technologies. If substandard work is found, the MCS makes installers put it right. It is very important that the people who get this wrong are not allowed to walk away. They must be the ones to remediate the problems.

We were clear that we need further oversight of the system while we bring in bigger reforms, which I will come on to. The National Audit Office is undertaking an investigation into the issues with ECO4 scheme. We welcome that investigation and the insights it will bring. We have also taken steps to strengthen oversight of the wider consumer protection system, so that in the short term, while we bring in wider reforms, we stop problems happening. That includes the UK Accreditation Service increasing rates of inspection of certification bodies, and agreement with TrustMark that a senior Department for Energy Security and Net Zero official will attend its board in an advisory capacity, so that we keep a firm grip on issues as they arise.

Certification bodies have agreed that installers will only be PAS 2030 certified for each measure by one certification body. The latest iteration of PAS 2035/2030 standards, which came into force on 30 March, introduced strengthened requirements to ensure high-quality installations. Energy suppliers have also strengthened their oversight of solid-wall insulation measures, so that there are additional audits and oversight of any measures brought forward.

Those are all important, necessary short-term steps, but it is clear to me that there is a systemic problem. We recognise that and are very clear that we need to put it right. We inherited a situation of many organisations with different roles and responsibilities involved in ensuring the quality of retrofit activity, resulting in a fragmented and confusing system of consumer protections. To address that and to create a clear, more comprehensive set of standards for consumers, we are moving forward with reforms, which we will announce in our warm homes plan to be published in October.

That plan will look at the entire of spectrum, including the training and the capacity building of installers, who are key. It will look at how installers who work in people’s homes are certified and monitored, and the quality assurance regime that we put in place. One insight we found was that capital schemes that tend to be overseen by local authorities and devolved Administrations have far fewer issues because of the level of quality assurance.

The plan will also inform people where to turn for redress when things go wrong, making that as simple as possible. The situation where consumers have to jump through multiple hoops just to get things sorted cannot be allowed to continue. Guarantees must be in place to ensure that, when things do go wrong, consumers do not foot the bill, and work is remediated by the system.

[Wendy Chamberlain]

I am grateful to the Minister for her response. It appears the Government do recognise the scale of the problem. Does she have anything to say about the worrying reports I received when preparing for this debate of people being forced to withdraw complaints before remedial work is carried out by companies? Is there anything we can do there?

[Miatta Fahnbulleh]

I thank the hon. Member for raising that. We will take that away because that is unacceptable. We have been in regular touch with every part of the system since this issue came to light. We are talking to installers, certification bodies, TrustMark, the MCS and Ofgem. I will take that issue away and write to her.

My final point on the reform agenda is that we clearly need a guiding mind overseeing the system. One reason we are in this bind is because we do not have that guiding mind. Let me reassure the hon. Member, who has spoken eloquently, passionately and with great insight about this issue time and again. the Government will take the decisive action that is necessary to protect the interests of consumers. It is essential to restore consumer trust, because we must take people on this journey of upgrading their homes, not just for our clean power mission but because that is the route to drive down bills and tackle the cost of living crisis.

If people do not trust the system, do not trust that upgrades will be of the utmost standards and that, if things go wrong, they will be fixed, they will not come with us on that journey. I am clear that we take these issues seriously. We inherited them but they are ours to fix. We will put in place a reform agenda and, critically, for people who have been affected by ECO4, we are working hard to ensure that the system does what it needs to do—that is, when issues are identified, installers go in and certification bodies TrustMark and MCS do their job to ensure that it is remediated at no cost. In the short term, we are trying to fix the problem we inherited. Then we will draw a line and put in place a system that is fit for purpose so that we can build consumer trust.

Question put and agreed to.

Oral Answers to Questions

Wendy Chamberlain Excerpts

Tuesday 29th April 2025 Commons Chamber

[Ed Miliband]

What is the point of the hon. Gentleman’s party?

[Wendy Chamberlain (North East Fife) (LD)]

I have been contacted by several constituents who have experienced failed ECO4 scheme installations. What support is there for constituents when installations go wrong? Are rogue installers getting paid for work that is not completed properly? What steps are being taken to address such failures?

[Miatta Fahnbulleh]

We are aware of issues that we have had with ECO4 and the Great British insulation scheme. If constituents have been affected, they should have received a letter from Ofgem. They should be able to contact their installer, who is obliged to fix the work, and there is a clear redress mechanism. There is a wider point: we know that the system for quality assurance and consumer redress is not fit for purpose and we are determined to overhaul it.

Oral Answers to Questions

Wendy Chamberlain Excerpts

Tuesday 4th February 2025 Commons Chamber

[Chris Law (Dundee Central) (SNP)]

1. What recent assessment he has made of trends in the level of fuel poverty.

[Wendy Chamberlain (North East Fife) (LD)]

18. What steps his Department is taking to tackle fuel poverty in winter 2024-25.

[The Parliamentary Under-Secretary of State for Energy Security and Net Zero (Miatta Fahnbulleh)]

The previous Government’s record on fuel poverty was absolutely woeful, and we have had to inherit an incredibly challenging trajectory. We are doing everything we can to shift that by upgrading homes for families in fuel poverty, driving up standards in the rental sector so that we lift 1 million people out of fuel poverty and supporting over 3 million households with our warm homes discount, all while running with our mission for clean power.

Energy Suppliers and Consumer Rights

Wendy Chamberlain Excerpts

Tuesday 25th April 2023 Westminster Hall

[Wendy Chamberlain (North East Fife) (LD)]

I beg to move,

That this House has considered energy suppliers and consumer rights.

It is an honour to serve under your chairpersonship, Mr Hollobone. I am pleased that we have time today—although I suspect that it might be cut off and restarted—to debate this vital topic and hear from the Government what they can do to assist our constituents. I acknowledge the Members who are here. I thank the Minister for reaching out to me before today in the spirit of co-operation, and I hope we can make productive use of the time.

If there is one thing that should always have been clear—if it is was not before this winter, it absolutely is now—it is that being an energy consumer is not optional. People who are off grid are hugely in the minority—the Minister will probably be relieved to know that I do not intend to talk about them and delays to fuel payments today. But for most people—millions of people—in the UK, the only way to heat their home, have light at night and keep their food fresh is to be a consumer via an energy company. We have learned in the past year that many energy companies are simply failing those consumers, and there is shockingly little by way of consumer rights in this area.

[Jim Shannon (Strangford) (DUP)]

I commend the hon. Lady for bringing this debate forward. In Northern Ireland, we have only two gas suppliers—there should be more. If there are more, there is competition, and if there is competition, prices come down. Does she agree that competition ensures that our constituents get better value?

[Wendy Chamberlain]

I thank the hon. Gentleman for his intervention. This is a 30-minute debate, so we will not get a speech from him. I agree that consumers need choice. Until this winter, many Members probably did not know the differences between the energy markets in Northern Ireland and other parts of the UK.

I came to this issue largely through casework. I saw a puzzling trend of constituents seemingly being overcharged and struggling to find redress, so we started asking people more widely about their experiences with their energy companies, and that really brought the cases rolling in. The issue is obviously not limited to my constituency of North East Fife; indeed, it would be strange if it was.

[Layla Moran (Oxford West and Abingdon) (LD)]

I congratulate my hon. Friend on securing this incredibly important debate. It is certainly not just in her constituency; it is everywhere. I have a constituent called Jacqueline, who is a pensioner and fell into debt of £140 with OVO Energy, which sent round bailiffs. She broke down in tears and gave them a cheque there and then. Actually, the company was not reading her meter, and she is now £2,500 in debt. She is on a state pension, so she does not know what to do. That kind of callous behaviour by energy companies should not be tolerated. We must do something about it.

--- Later in debate ---

[Wendy Chamberlain]

That is not dissimilar to some of the cases I have seen in North East Fife. It seems to be that if we speak to a different person at the end of the phone at a different time, we get a completely different outcome. That is simply not acceptable.

Citizens Advice has said that there was a 230% increase in energy complaints to its Extra Help Unit this winter. For the first time, that has made energy the top advice issue. This is not confined to Oxford West and Abingdon or North East Fife; it is taking place throughout the UK.

[Dr Dan Poulter (Central Suffolk and North Ipswich) (Con)]

There is also a broader issue with the Government energy rebate during the winter period. People who live in park homes receive the energy rebate at the behest of the park home owner—they do not get a direct energy rebate from the energy company—but they are still potentially liable to the energy company. What would the hon. Lady suggest that the Minister do to ensure that park home residents receive the benefit of the energy rebates that the Government have made available, and to ensure that energy companies and park home owners are held accountable so that the energy rebates go to the residents of the park homes?

[Wendy Chamberlain]

I thank the hon. Gentleman for his intervention. I, too, have park homes in my constituency, and that issue has come up. At the moment, we are completely dependent on the good will and good conduct of park home owners when it comes to ensuring that those living in park homes get their rebates. We need to consider the legislative agenda. The Energy Bill, which I will come to, had its First Reading in the House today and we should certainly be thinking about that.

What I am trying to say is that contacting an MP has sometimes become the only route for constituents who seek redress; as constituency MPs, we all know that. That is widespread. We can see that something in the system is failing, which is why I secured this debate. The Government have a role in consumer protection and the energy market. Just today, two new Bills have been introduced to the House: one, the Digital Markets, Competition and Consumers Bill, is explicitly about consumer rights, and the other is the Energy Bill. Both are about making our system fit for the future. Over the last year, we have seen that the Government have a role in ensuring that the energy market is working for consumers and that people can afford to pay their bills.

I would like to outline some of the problems that my constituents have been having before I return to the question of consumer rights. Overcharging has already been mentioned. A quarter of all the correspondence that I have received has been about that, which suggests that a huge number of people in the country—thousands, if not hundreds of thousands—must have the same issue. We know that energy bills have gone up and that there has been action to help people cope, but this issue is not about that. It is about energy companies billing families huge sums of money for energy that they have not used and about families doing their best to manage the cost of living—keeping costs down, putting food on the table and keeping afloat—and finding themselves facing debts of hundreds of pounds.

The overcharging comes in two forms, and both are deeply harmful. Imagine that you are a direct debit customer who pays bills monthly, accruing credit on your account. Those payments might have gone up when you renewed your contract last year, but that is fine because you planned for it. You budgeted. It has been difficult, but you made it work because that is what we all have to do. You have done your best to reduce your energy usage to make sure you did not end the year in debt. You have done everything that you reasonably can—[Interruption.]

[Mr Philip Hollobone (in the Chair)]

Order. A Division has been called in the House. The sitting will adjourn until 4.22 pm if there is one vote and 4.32 pm if there are two votes.

--- Later in debate ---

[Mr Philip Hollobone (in the Chair)]

The hon. Member has already had seven minutes, so the debate can last until 4.55 pm.

[Wendy Chamberlain]

I will move on quickly. I was outlining some of the issues with direct debits and giving the example of someone paying by direct debit whose payments may have gone up, but who was basically managing. But imagine if, despite that, their energy provider increased their direct debit payments, without their knowledge or any discussion about it, and they only found out because their carefully arranged budget was no longer in balance—they did everything right and were suddenly in debt anyway.

That is what is happening to people. I have seen a number of cases in North East Fife. One of my constituents had £900 in credit, yet their energy supplier is taking more. This surely is not right, and it is surely not the kind of practice we would accept. I urge the Minister to call this behaviour out and take proactive steps to prevent it from happening to other families and individuals.

The second form of overcharging is arguably even more egregious. This is where customers are receiving bills from energy companies for energy they have not used. Again, we are talking about hundreds of pounds being demanded, with threats of enforcement measures and huge amounts of distress as a result. I pay tribute to my casework team, who have been working these cases and providing fantastic support to my constituents. They try to understand what went wrong, but sometimes that is very difficult, as people are dealing with an opaque system and too often being told that their energy bill is final.

We have had some success in proving that bills are wrongly being charged, but even then energy companies do not always just cancel the bill. One of my constituents paid her £700 bill for fear of enforcement measures, and not many people have that sort of money just lying around. It is a stretch. Even now, the company has repaid only £500, insisting that £200 sits in the account as credit. That is £200 wrongly taken from my constituent that ought to be paid back.

As for the causes of these issues, some of it comes down to, arguably, predatory sales calls—lies are told and cooling-off periods are not respected. Some of it seems to be errors in the system, which when highlighted ought to be corrected, not defended. A lot of it seems to come down to smart meter issues. When they work, they are excellent, but when they do not, they are simply terrible. I fear the Government are trying to run before they can walk with the Energy Bill. They are pushing ahead with the roll-out and encouraging more use of smart appliances without getting the fundamentals right first.

Let us start with something basic: smart meters need to be connected to either the internet or a data signal. My constituency of North East Fife is rural. It is not as rural as some places, but rural enough that many properties are still without reliable internet access and there are mobile signal blackholes. Smart meters simply do not work in those conditions, but energy companies are too often refusing to listen. Another one of my constituents strongly argued against having her traditional meter replaced, knowing the signal issues at her property. The energy company ignored her and did it anyway. What a surprise: the smart meter does not work. Not only is she unable to monitor her usage, but her company, E.ON, is now charging her to reinstall the old-style meter.

Other constituents are able to have smart meters and, indeed, want them to help to keep on top of their bills, but even when the internet connection is good, smart meters still break. When they break, energy companies do not seem to want to replace them. One constituent’s meter stopped working last October and, despite requesting one, has not had a replacement from SSE since. In the meantime, she cannot monitor her usage and her company cannot take readings. As a result, the company is taking larger and larger sums from her bank account based on estimates.

Another constituent—a vulnerable pensioner—has been waiting five months for a replacement gas meter. She was told that she could go outside and read the old-style meter in the interim, but she is disabled—she simply cannot do that. The list goes on, and the longest waits for replacements that I am aware of are well over a year—month after month of knowing that prices are going up and not knowing how much it is costing, and energy companies erring on the side of caution to their benefit, taking huge sums from customers. Of course, all those problems are compounded when we talk about vulnerable customers. I welcome the fact that Ofgem has a vulnerability strategy; but again, from the casework I have received, more clearly needs to be done.

I am aware of time and have not reached my main point yet, so I will be brief. Two things come through in the casework. First, billing is confusing for many people. Not only is it fair for customers to understand their bills; it is better for the market when consumers can compare bills and charges between different energy companies, as the hon. Member for Strangford (Jim Shannon) alluded to. For that, I ask the Government to consult with stakeholders and disabled people to look at putting bills into a standard form. Secondly, priority service registers are not working effectively. More needs to be done to make it easy for vulnerable customers to identify themselves to energy companies, and companies ought to be proactive in looking out for those consumers. I am sure that all of us, as MPs, have encouraged constituents to get on those lists.

The thread that links all these issues together—and the reason why I am having to help constituents with energy issues, as I am sure everyone else here too—is simply the utterly abysmal customer service and the lack of clear consumer rights. Most consumer-facing industries have some form of consumer charter or code of practice. It exists in customer service and for aviation passengers, for water consumers under Ofwat and in broadcasting under Ofcom, but it does not exist when it comes to energy. What is there is incredibly basic and not helpful for individuals at all. Energy companies are regulated through Ofgem, and one of their licence conditions is that consumers must be treated fairly—that is it. That does not tell us anything. A Q&A document from Ofgem sets out some situations where a customer could be entitled to £30 compensation, such as when their smart meter breaks and is not investigated within five working days. Considering the sums of money being charged and the waiting times for replacements, that is a completely ridiculous method of enforcement and no incentive to companies to protect their consumers.

I am not criticising Ofgem. Indeed, I welcome last week’s code of practice relating to pre-payment meters and its plans to consult on further standards. I am grateful that Ofgem spoke to me at short notice on Friday. The new system operator being set up under the Energy Bill will not help when it comes to consumer rights. Its goals are controlling cost, moving to net zero and ensuring our energy independence. These are all welcome, but leave a gaping hole when it comes to basic rights and service. Clearly, energy companies are falling far below any ordinary standard of service to consumers, and the need to keep adequate suppliers in the market means that Ofgem cannot threaten to take licences away from all of them, because bad practice is simply too widespread.

Does the Minister agree that energy consumers—that is, all of us—should have the same rights as people taking a plane or running their tap? Does she agree that the energy market can function properly only when our consumers know their rights and are empowered to enforce them? Does she agree that it is unconscionable for energy companies to be treating their consumers in the way they are today? I want every single issue from my constituency sorted out, and I hope the Minister will engage with that and the energy companies too, but we can be proactive and solve the root cause. I am asking the Government to consult on a new consumer rights charter for energy bills that will be communicated widely and where good companies can be accredited, and which will make our energy market work for consumers as well as for responsible suppliers. I look forward to hearing the Minister’s remarks.

Energy Support for Farms

Wendy Chamberlain Excerpts

Tuesday 21st March 2023 Westminster Hall

[Carla Lockhart (Upper Bann) (DUP)]

I beg to move,

That this House has considered energy support for farms.

As a matter of openness and transparency, I declare an interest: I come from a small, family-run farm. Thank you for chairing the debate, Mr Robertson; it is a pleasure to serve under your chairmanship. I thank the Minister for being here and for his prior engagement on the topic. I thank hon. Members from across the House for giving their time to attend this debate on this important issue.

In the constituency that I represent, the agriculture sector is vital to our economic wellbeing. In the wise words of my grandfather, if the farmer is not doing well, no other industry is or will; such is the importance of our agrifood industry. Across the wider Armagh, Banbridge and Craigavon area, we have 3,431 farms. They contribute approximately £376 million in goods value and farm support payments into the local economy. They provide employment in the agriculture sector and in the 265 local agrifood sector businesses that the industry supports. In Northern Ireland, we have 26,000 farming families. The agrifood sector is worth more than £5 billion to the economy, and we feed more than 10 million people with our top-quality produce.

As has been the case for all households and businesses, energy costs on these farms have spiralled since the outbreak of the war in Ukraine. Many farms are unavoidably energy intensive. Take dairy, for instance. Farmers who needed to renew their energy contract last autumn experienced increases of more than 400%. With an electricity price of 37p per kWh, the annual cost to an average-size dairy farm is now approximately £105 per cow. For a 250 cow herd, that adds up to £46,000 a year, which is up by £26,000.

[Wendy Chamberlain (North East Fife) (LD)]

I congratulate the hon. Lady on securing this important debate. I absolutely agree with her and want to give my own example. I represent a local seed potato farmer whose costs have increased from £10,000 to £30,000. He has a generator and thinks he may have to come off the grid entirely. He faces an increase not only in energy costs, but in standing charges. Does the hon. Lady agree that farmers face a cliff edge at the end of this month and are disappointed that the Government did not do more to support them through the Budget?

[Carla Lockhart]

I think the hon. Member has been reading my speech. A cliff edge certainly is coming for this important industry, which is the backbone of our economy.

Another example is poultry. There has been an increase of approximately £87 a day, which equates to about £32,000 a year. That is a phenomenal amount, and only so much of that can be passed on.

Ahead of the Chancellor’s spring statement last week, our farming unions, alongside Members from across the House, had been lobbying to bring about a change in mindset from the Government in relation to support for farmers with energy costs. The Government must recognise the key role of the agriculture sector in feeding the nation. The industry needs support in the face of energy price pressures.

The current support from the energy bill relief scheme is due to expire at the end of March. It will be replaced by the energy bills discount scheme, which will run for 12 months. That scheme offers far less protection and support to businesses, with the removal of the price cap and its being replaced by a token discount. A pre-defined selection of industries has been identified for additional support under the energy and trade-intensive industries scheme. However, farming sectors have been left off this scheme, leaving them literally out in the cold without support. In the face of that cliff edge, the ask of the Government was straightforward. Our farming unions, on behalf of their members, sought the extension of the energy and trade-intensive industry scheme to include energy-intensive sectors, such as horticulture, poultry and pig production. That was a reasonable ask that the Government should have listened to.

Poultry businesses are reliant on gas and electricity to rear poultry and store fresh produce safely. Without sufficient support, there is no doubt that those farmers will struggle to absorb the huge hikes in energy prices that they will face. The same can be said for pig producers.

--- Later in debate ---

[Wendy Chamberlain]

I thank the hon. Lady for giving way again. Wholesale energy prices are already falling. The Government have not spent the amount of money that they had expected to spend on their energy-relief schemes. Does she agree that the Government have the headroom to go over and above what they announced in the Budget and to date? They could use those additional funds to support our farmers.

[Carla Lockhart]

I absolutely agree with the hon. Lady. There is the headroom and available money. I encourage the Government to do the right thing by the industry and to support those farmers at this time of need. This decision will have consequences; the cliff edge will be too much for some farmers. They will exit the industry and others will reduce output, unable to absorb the cost of maintaining their current output. Consequently, UK food production will fall, processors and manufacturers in the supply chain will be impacted, food inflation may well increase, and consumers ultimately will end up paying more.

No one wins from this decision. I believe it is still in the interests of the Treasury and the Government as whole, the agrifood industry and consumers that this decision is revisited. I ask the Minister to undertake to explore this comprehensive case once more, and to step up with the support these farms need to face the challenge and conditions they find themselves in. I also invite him to visit my constituency in his ministerial capacity to witness at first hand the value that these farms add to our economy and the pressure that they are currently feeling.

We need to back British farming. The Government demand the highest standards of our farmers and must repay their endeavours to produce world-class produce to the best animal welfare, environmental and sustainability standards with sufficient levels of support to enable them to do just that.