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Proceeding contribution from Steve Webb (Liberal Democrat) in the House of Commons on Thursday, 16 October 2008. It occurred during Topical debate on Energy Providers.


Energy Providers

The hon. Gentleman makes an important point. I will return to the issue of home insulation programmes. I shall stay on the issue of fuel poverty, and the figures that I referred to earlier this afternoon. I asked the Library to look at single pensioners, to rank them by quintile from the poorest to the richest, and to look at what they spend on fuel and what their actual incomes are. The Library projection, on figures provided by the Office for National Statistics, was that not just the poorest quintile were on average in fuel poverty this autumn, but the second, third and fourth poorest quintiles. All quintile groups except the top fifth were on average in fuel poverty this autumn. The scale and the urgency of the problem are absolutely incredible. The Minister said that two thirds of a million customers were on social tariffs. That is great for the two thirds of a million, but that must mean that if fuel poverty is running at well over 3 million, and possibly at 4 million or more, the vast majority of people in fuel poverty are not getting social tariffs. It is not just that the glass is half full or half empty; it is about a sixth full. That is the scale of the problem. So how do we get social tariffs through to the fuel-poor on a much greater scale? I want to address the issue of the companies. The Secretary of State has had a meeting with them and that is great; his predecessor had meetings, and the Prime Minister has had meetings, but we are not getting out of them what is needed. The Secretary of State said—I believe he did so in The Guardian this morning—that he hoped that the companies would not pass on the cost of the home insulation scheme to consumers, but he can hope all he likes; the companies can do it, and the consumer can do nothing. Surely, Ofgem should be stopping the companies passing on the costs of these social measures. If it is a duty on the companies, the customers should not be forced to pay. The shareholders should be forced to pay, because as was said in a previous contribution, the generators—not the distribution companies, although obviously there are some pretty close links—have had this huge windfall, according to Ofgem. In my view, one does not have a windfall tax that takes the money off them and then spends it; one places a duty on them to do the things that one wants them to do. In our view, we go very much further down the track than the Secretary of State said in terms of neighbourhood energy efficiency. The problem with the carbon emissions reduction target is that a road with six houses can be served by the six different companies, and six different men in six different vans can go down to help that company achieve its CERT obligation. As the hon. Member for Stroud (Mr. Drew) said, there are great variations in the types of houses and in different areas. We need a neighbourhood-based approach on a massive scale. The problem with Warm Front is that it adopts a piecemeal approach, although it has done good work. Local authorities know their neighbourhood. The answer will be different in Stroud and in South Gloucestershire, for example. We need substantial money from the supply companies—a windfall duty on them—to deliver systematic energy efficiency. Yes, as the Minister said, they can provide benefit advice too—if someone is going to knock on those doors, they might as well ask that set of questions as well—but I think there is a paucity of ambition here. Literally millions of pensioners are affected, and I would mention, too, disabled people below pension age who do not qualify for the winter fuel payment but who may face extreme heating bills that they have no choice but to incur. There is a serious worry this winter, particularly for people on pre-payment meters, about self-disconnection. We do not see those people in the headline figures, and I hope that the Minister will ask the energy companies how much that happens. People on pre-payment meters simply do not have the money to top them up, and they just switch off the power. That does not feature in disconnection statistics, because no one disconnected them—they disconnected themselves. That could well be a hidden disconnection scandal that gets worse this winter. There are some serious issues for consumers, as the problem is imminent. Further consultation on possible legislation simply does not meet the scale and urgency of that problem.


Secondary information

Type
Proceeding contribution
Reference
480 c967-8 
Session
2007-08
Chamber / Committee
House of Commons chamber
Subjects
Costs Coal Investment Electricity generation Energy supply Financial markets Oil Prices Renewable energy Taxation Regional electricity companies Social tariffs
Link
View this Proceeding contribution on www.publications.parliament.uk