“There is no question but that the electricity pool has distorted the market”.—[Official Report, 15 June 2000; Vol. 351, c. 1102.]

When the NAO reported on the old pool in 2003, it said that the

“the centralised arrangements of the pool carried with them a risk that some generators could manipulate the market and Ofgem consider that this risk materialised through much of the period of the Pool’s operation to the detriment of consumer interests.”

Indeed, many at the time believed that the pool was leading to higher and not lower energy bills. That is why the Government are not convinced by the Opposition’s policy.

Dr Alan Whitehead (Southampton, Test) (Lab) rose—

Mr Davey: I will give way to the hon. Gentleman, who is a member of the Select Committee on Energy and Climate Change.

Dr Whitehead: Is the Secretary of State aware of how many generators there were at the time of the abolition of the pool compared with the number of retailers, and does he think those circumstances have been replicated today? It would help the debate, if he could provide some numbers.

Mr Davey: I have already. I explained how the number of companies fell under Labour. [Hon. Members: “How many?”] There were two: PowerGen and National Power. Yes, I do know. And there are more generators now, so going back to the pool, when there were fewer generators, would be a bit odd.

Ian Swales (Redcar) (LD): Does the Secretary of State think that the previous Government’s abolition of the public interest test on takeovers was one reason for the consolidation of the energy market?

Mr Davey: As a former competition Minister, I know that commenting on such things is extremely tricky, so I will leave that to my right hon. Friend the Secretary of State for Business, Innovation and Skills.

I want to focus on how we can tackle the real problems in the energy market. I think we all agree that there is a problem with competition. When we compare the UK market with overseas markets, a key observation is that

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our markets are less liquid, especially the forward market. To get a good, competitive energy market, firms should be buying and selling electricity three, six, 12 or more months in advance. If they were, and if we had greater market liquidity, it would be much easier for independent generators to enter the market and invest in generating plant confident that they can buy and sell electricity and manage their risks.

Faced with the might of large, vertically integrated energy companies supplying their own power, independent generators find it difficult to enter the market. I think we agree on that. The question is: how do we deal with that? The problem is with liquidity, not the pool. The right hon. Member for Don Valley, who clearly dislikes Ofgem, has not noticed that by threatening to take action Ofgem has, to some extent, already made progress on liquidity. As we have seen, large volumes are now being traded in the day-ahead market, which has improved price transparency. That is a good start.

Caroline Flint: One company.

Mr Davey: No, there is more than one company, as I think the right hon. Lady will find when she checks.

Ofgem and my Department agree that Ofgem’s voluntary measures do not go far enough, so the latter has been working on a mandatory auction, and it might well be that some sort of trading obligation is the way forward. I can confirm that I have been considering this matter intensively for some time, and that I will bring forward measures in the Bill to address it. At the very least, these will be back-stop powers in case the efforts of industry and the regulator prove insufficient. If we are to drive competition in the generating side of the electricity market to help people and firms struggling with bills, we must address the liquidity problem. The right hon. Lady’s policy does not do that, but ours does.

Barry Gardiner: I agree that it is important to free up liquidity in the forward market—I do not think there is any dispute about that—and, in so far as that goes, it is welcome. However, it will not address the problem of a generator such as Centrica making a £1.5 billion profit while the retail prices of British Gas rise, because it will not be possible to see that integration—it can show its profits where it likes. The Secretary of State talked about integration of the retail and wholesale market. He has to address that, otherwise we will not resolve this problem.

Mr Davey: The only way to ensure greater transparency is to have more liquid markets. That is the whole point of liquid markets. Without them, people cannot compete or buy and sell their electricity forward, and we cannot ensure price transparency. That ought to be welcomed by the Labour party. I would be worried if it set its face against greater liquidity in the forward market. It would be a very odd position to take.

I have spent some time explaining how our various policies will promote fiercer competition and help cut bills, and I have set out why I think the Opposition’s proposals are fundamentally flawed.

Gavin Shuker: What social obligations does the Secretary of State feel would be appropriate to place on energy companies?

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Mr Davey: We put quite a lot of social obligations on them now. As the hon. Gentleman knows, the carbon emissions reduction target scheme is being replaced by the energy company obligation, which will include the affordable warmth target to help people in fuel poverty, and the carbon saving community obligation to help areas in fuel poverty. There will also be measures promoting solid wall insulation and other things needed to take energy efficiency policies forward.

Andrew George (St Ives) (LD): I strongly support all the initiatives that my right hon. Friend is describing, but the energy companies are not addressing all the issues of fuel poverty. Those on the margins of credit still cannot take advantage of direct debit deals, while the falling block tariff also works against their interests, and there are a number of other measures where those companies are not addressing fuel poverty. Does he agree that they could do much more to help those in fuel poverty?

Mr Davey: That is one reason why I welcome the retail market review, and we will be consulting on measures and introducing them in the Energy Bill to address those and other matters.

I want to talk briefly about energy efficiency, although I am conscious of the time. On the social tariffs that the hon. Member for Luton South (Gavin Shuker) talked about, and on energy policy across the board, it is important to see both sides of the equation and understand what we are trying to do with clean energy. By 2020, all the energy and renewable subsidies combined will add £95 to bills, yet those same bills will fall by about £220, thanks to the energy efficiency improvements that our policies are bringing forward. Our green policies are about lower bills, not higher, and we are delivering on that.

As part of our policy, energy efficiency is a top priority for me, because reducing demand saves consumers money now and reduces future pressure on supply. I will give just two examples, although I am sure that Members across the House could give many more. Installing solid wall insulation saves about £270 a year on the average energy bill, while upgrading an old, G-rated boiler to a modern, A-rated one can save £200 a year. Our flagship green deal scheme will make it easier for home owners and tenants to improve the energy efficiency of their homes, paying for those improvements through savings on their fuel bills. I hope that we will continue to have the Opposition’s support, but I am not always clear where they stand on the green deal.

Caroline Flint: The Deputy Prime Minister suggested in a speech last year that he would tackle the concern about the high interest rate associated with the green deal. It will be about 7%. What progress has been made on bringing it down?

Mr Davey: The right hon. Lady ought to know that the interest rate will be set by the market, and that this—I say this as a former consumer credit Minister—is actually a great deal. People would not get an unsecured loan of this nature at the interest rates in the green deal. This will be a good deal for people on low incomes, in particular.

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Through the energy company obligation, which will be introduced with the green deal, we will be requiring energy companies to provide an estimated £1.3 billion a year of support for energy efficiency in our homes, including £540 million to fund energy saving improvements to around 230,000 low-income, vulnerable households every year. Whether through reform of the energy market, our proposals on competition or our proposals on energy efficiency, the Government are taking action that will help people with their bills. The right hon. Lady’s motion would do the reverse—her proposals are fundamentally flawed—so I invite my colleagues to join me in the Division Lobby and defeat her motion.

Several hon. Members rose

Mr Deputy Speaker (Mr Lindsay Hoyle): Order. I remind hon. Members that an eight-minute limit on speeches has been imposed.

1.48 pm

John Robertson (Glasgow North West) (Lab): The Secretary of State is very good with a brief in front of him but very poor when he comes before the Select Committee, where he has to answer questions. He beats around the bush and never answers a question, and I congratulate him once again on doing the same thing.

I congratulate my right hon. Friend the Member for Don Valley (Caroline Flint) on her motion, although we would probably disagree on a couple of things.

A month or so ago I introduced a ten-minute rule Bill on prepayment meters that would change the amount of debt that customers build up from £200 to £350 and give 200,000 people the opportunity to reduce their debt. Since then, Ofgem has announced that it wants the limit to be increased to £500, taking 400,000 people out of debt. I congratulate Ofgem on not only listening to me but going further than even I had suggested—I cannot have a go at it about that. I also worry about the 68 people it employs in Glasgow and, of course, the 722 staff in London who do the best they can with the rules they are given.

Ofgem and many other regulators such as Ofcom were introduced at a time when we wanted light regulation. That was a particular request shouted by those on the Opposition Benches while we were in government and we gave them that, but unfortunately times change. We are in a double-dip recession and things are harder. Many people in my constituency worry about whether they will be able to pay their bills this winter. The Secretary of State talked about helping people with energy efficiency, but how can we offer someone who lives in a multi-storey concrete block energy efficiency when they spend the summer cooling down the concrete walls and the winter heating them up? How can they have energy efficiency? They cannot. Those people do not have computers; they cannot switch providers.

I wrote to the energy companies three weeks ago and asked them to outline how they identify vulnerable people and what they do to try to help them. I have had three replies and three companies—E.ON, EDF and SSE—have not bothered to reply. They might not have quite got round to it or they might have been too busy counting money, but I want to know how they identify vulnerable people and, more importantly, how we can reach those people. No energy company has ever come to me to ask where I think the vulnerable people are in

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my constituency. I think I probably know better than those companies what happens in my constituency, given that I have lived there nearly all my life, yet they will not talk to me about these matters.

I asked about the cheapest tariffs—perhaps the Secretary of State could try this for his own house. People wanted to talk to me about that—not because I was a member of the public but because I was an MP, so they thought that the companies would give me some attention—but even they could not tell me the cheapest tariff. If they cannot tell me what the cheapest tariff is, what are they telling people outside this place?

The Secretary of State talked about four tariffs. If I pay by direct debit, will I get a lower bill? Yes. We have now doubled the four tariffs to eight. If I pay by cheque, will it be cheaper than a payment by standing order? Before we know it, there will be 20 or 30 tariffs rather than four. It is ridiculous, however, that we have 400 tariffs, and I raised that question in my Select Committee when the previous Government were in power.

Mr Mike Weir (Angus) (SNP): Is it not also a problem when we try to compare different tariffs from different companies, as they are not always trying to sell the same thing? We need identical tariffs—perhaps four of them—across the companies because otherwise it is meaningless.

John Robertson: The hon. Gentleman is absolutely right, but I would go even further. I met Which? this morning and its representatives said that they wanted energy to be like petrol and diesel. We are given a price for petrol and diesel and we know how much we are paying per litre; Which? wants to do the same for units of energy. Different companies can charge different prices. I do not have a problem with companies making a profit, but if they make an obscene profit I expect the next Labour Government to consider a windfall tax. We let these companies run as businesses and we want them to act responsibly, but if they make obscene profits on the backs of people, particularly poor people, I would expect my Government to consider that and to tax them accordingly.

I have to agree with the Secretary of State on the question of the over-75s. I would bring the minimum age down to the retirement age. As the retirement age is going up, 75 might not be off the mark in a few years’ time, but at the moment it is 67. If I retire, I will be 65, fortunately, so it would be nice if that age limit was 65.

That takes us back to vulnerable people. There are many single parents and disabled people, and we forget about them at our peril because they sometimes need more help than the elderly. As we move towards becoming the next Labour Government and proposing our own energy Bill, we need to consider these matters as they are very important.

In Prime Minister’s questions today, the Prime Minister was asked about his previous statement on tariffs. As I said earlier, no one really knows what those tariffs are. The Department of Energy and Climate Change told our Select Committee that it could not intervene and that it was down to the companies, but now it says it can intervene.

The regulator is, unfortunately, very poor at delivering. It is not that it does not want to do the right thing—it does—but the Government set the agenda for Ofgem. If

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the direction is poor and the regulator is not given the power to impose fines—

[

Interruption.

]

If the Secretary of State listened for a second, he might learn something.

There is an imbalance in how the generating companies spread energy about the country and it seems to be a bit of a rip-off. We pay the companies to shift electricity from one side of the country to another and it costs the taxpayer more than £340 million. It used to cost only £35 million, but it is now closer to £350 million, so why have the Government and Ofgem, who know that that fiddle goes on, not taken any of those companies to court to try to get the money back? I am told that one of the worst areas for that double dealing is the Cheviot hills, which are only about 20 miles from my house.

If wind farms are part of the problem and are being paid to close down, there is something wrong with our energy policy in this country. We need to look at that. I believe that Ofgem does a reasonable job but could do better and a reorganisation would be the best way forward, as we cannot reinvent the wheel once we have it. The Secretary of State also needs to get on top of his job and portfolio so that he can help people as he is supposed to, rather than engaging in stupid political point scoring from the Dispatch Box.

1.58 pm

Mr Marcus Jones (Nuneaton) (Con): I welcome today’s debate, because energy is one of the most important issues for my constituents. The pressure on the cost of living over the past four or five years has been relentless, with petrol and diesel prices going up almost weekly, food prices going up in the same fashion and energy bills soaring. Over that time, people’s incomes have not increased anywhere near in line with those increased costs and salaries in both the public and private sectors have been pretty much static.

Despite the rhetoric we have started to hear from the Opposition, the Government have made moves to try to help with the cost of living. We all know that had the Opposition been in power, petrol and diesel would have been 10p a litre dearer at the pumps. We all know that the Government have frozen council tax for the third year in succession, in stark contrast to Labour, which doubled council tax during its 13 years in government. My constituents who commute using Nuneaton station will also be heartened that regulated rail fares are to be capped this year.

Much of the problem with energy prices stems from energy generation issues and the energy market. We all know that the wholesale cost of oil and gas accounts for half the cost of energy. Given Labour’s inertia, inactivity and lack of enthusiasm about energy generation during its 13 years in government, it seems opportunistic for Labour Members to put forward this motion.

I welcome the fact that the Government are working hard to incentivise low-carbon energy, and I hope that the Minister will provide some reassurance about the energy mix and confirm that clean coal will be a firm part of that mix. Many of my constituents work at Daw Mill colliery—one of the largest deep producing coal mines in the country. I am sure that my constituents will be very interested to hear the Minister’s comments.

Barry Gardiner: The hon. Gentleman quite rightly said that wholesale electricity prices are based on the wholesale price of gas, but will he explain why a company

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such as EDF, which supplies electricity to its customers yet generates from nuclear, should benefit in exactly the same way from the higher price of gas, which of course it does not pay?

Mr Jones: The hon. Gentleman’s comments are interesting. I am a firm supporter of nuclear energy—he might not be, but it is absolutely necessary. This Government are trying to incentivise companies to make sure that nuclear is a firm part of the energy mix and that we are not switching off the lights.

Ian Lavery (Wansbeck) (Lab): The hon. Gentleman mentions Daw Mill colliery in his constituency. It faces closure, yet it has thousands of tonnes of reserves—it has one of the biggest reserves in the country. What do the Government intend to do to save those jobs and exploit those reserves?

Mr Jones: I thank the hon. Gentleman for raising that point, as this Government have been helpful and have followed the situation at Daw Mill very carefully to try to help it have a future. I am aware that positive negotiations are going on between the work force, the unions and the company to try to secure its future after many years of poor management, which left the colliery without the necessary work being done on the coal faces to help the company sustain an operation employing 800 workers. There are challenges there, but I am confident that the interested parties can come to a deal. I assure the hon. Gentleman that my hon. Friend the Member for North Warwickshire (Dan Byles) and me, as constituency MPs, and the Minister responsible for energy have spent a lot of time trying to help.

Let me move on to discuss another important part of our future energy policy—shale gas. Notwithstanding the environmental impacts and assessments that need to be done, I very much feel that shale gas has a real future. In coming years, it will help to create sufficient energy supplies and contribute to energy security, as well as helping to bring people’s bills down, as it has in the United States.

The energy market itself is an important matter. The right hon. Member for Don Valley (Caroline Flint) came up with a gem—or probably what I would call an “off-gem”—when she admitted that Labour had created the problem by reducing the number of energy providers from 15 to six. She now expects the current Government to sort it out, which is quite interesting and seems to be a recurring theme: this Government having to sort out the inadequacies and the mess left by Labour.

I went on to a price comparison website this morning to find out the position if I chose to move energy suppliers. Under the dual fuel section, I clicked on to E-ON and noticed that I could change to any one of 52 tariffs. For example, there was the E-ON fixed price 5, E-ON fixed two-year Tesco clubcard points, Age UK one-year fixed, not to mention the other 49 different tariffs of different descriptions. There is a real issue of transparency; people need to know what they are signing up to and what else is available to them. I welcome the Prime Minister’s announcement that the Energy Bill, or part of it, will be used to encourage energy suppliers to take responsibility for letting people know the lowest tariff and for trying to move people on to it.

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The cost of living is another important point, and I shall particularly mention the mortgage market. People finish a fixed deal with a mortgage lender and are put on to a standard variable rate, which might not be the best rate, or are not told that a better rate could be achieved. People who do not always look at these things are paying more than they need to. We definitely need to consider this issue across the piece.

We need to ensure more consumer choice for energy. We have more competition and more transparency in the market. I am heartened by Ofgem’s proposals to pare down all complex, multi-tier tariffs and limit energy companies to a smaller number of core tariffs. I think that will help people better to understand what they are signing up to and what they can go on to. We must also ensure that people know that they are getting value for money. We know all the trouble and hassle that swapping providers can cause; we know that it puts people off, so we need to make it as simple as possible to swap providers.

In my remaining minutes, I want to highlight consumption as a major issue. We must keep working hard, and I know that the Government are trying to reduce people’s energy consumption. I am sure that the green deal will make it easier for people to make home improvements that reduce their energy consumption. Many people who have worked and are working hard might not have the necessary capital sum available, might not qualify for benefits and might not be able to get other incentives, payments or grants to improve their property, but the green deal will give them the opportunity to help themselves to reduce their bills.

We need a balanced, open and honest debate on this issue. We need to make sure we do all we can to reduce the cost of living across the piece for all our constituents in these hard-pressed times. What we certainly need to do through this debate—and, I hope, through the Energy Bill—is to put in place a framework that will ensure that we have long-term energy security, enabling our constituents to reduce their bills in the coming years.

2.8 pm

Mr Mike Weir (Angus) (SNP): I have no great problem with the motion moved by the right hon. Member for Don Valley (Caroline Flint). I might even vote for it—despite the fact that she would not take any of my interventions. I would, however, like to comment on one aspect. The motion is headed “Energy Market Reform”. In fact, both Front-Bench spokesmen entirely concentrated—apart from one brief mention from the right hon. Lady—on the big six in the electricity and the gas markets. As often happens in these debates, they totally failed to address the problem of those who are off the gas grid. To their credit, this Government brought forward the Office of Fair Trading review of the energy market. To almost universal disbelief, however, it was decided that the market was working fairly.

The Secretary of State spent a good deal of time talking about competition and how he was going to introduce it; again, this seemed to be focused on the electricity and gas markets. However, those who are off the grid have faced some of the highest price rises over the past year. The OFT said that that market was working okay because there were plenty of suppliers in it. I should like to think that that there are plenty of

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suppliers, because many of them are connected with each other, but does that not illustrate the difficulty of dealing with the issue if we rely on competition? Competition has failed in that market, and, indeed, in the bigger market as well.

There has been much talk about switching. There are several problems with that. For instance, when one of the energy companies puts up its prices, there is a follow-my-leader process: over the next month or two, the rest start to follow suit. People who have switched have found themselves in a worse position, because although the company to which they switched was giving a better deal at first, suddenly it is not a better deal any more.

The Secretary of State spoke said that the community base must include the fuel-poor. That is true, because they are the only people who will really benefit from switching. When I joined the Which? campaign, I looked into whether it was worth my while switching. However, I am still using the former monopoly supplier in my area, which was much derided earlier in the debate. When I received the figures from Which?, I concluded that switching would not be worth my while because the savings would be so low, and in view of the hassle that would be involved in switching, I did not bother.

The hon. Member for Glasgow North West (John Robertson) mentioned his private Member’s Bill, which deals with pre payment meters. People with pre payment meters will make significant savings only if they are on a very high tariff. Those of us who have made the effort to reduce consumption and become more energy-efficient also find that it is not worth switching, because we are not using enough energy for it to be worth while. The real problem is that energy bills continue to rise, and that hits everyone.

John Robertson: The hon. Gentleman was an excellent member of the previous Energy and Climate Change Committee, although we did not always agree, particularly when nuclear matters were being discussed. Does he agree that those who would save the most money by switching are the ones who do not receive the necessary information, or even have an opportunity to switch?

Mr Weir: The hon. Gentleman is right. There are many reasons for that, but one of the most basic is the digital divide. Many people who might otherwise benefit have no access to these deals, because many are online. They find it very difficult to obtain information. Furthermore, they tend not to have bank accounts.

Let us be honest: the energy companies are not interested in those people. They are the customers who may run up debt, and the energy companies do not generally want to take them on. They make sympathetic noises now and again, but the customers they want are people such as the hon. Gentleman and me, who are relatively well off and can pay by direct debt. I presume that the hon. Gentleman pays his bills on time; I would certainly expect him to. Those are the people whom the energy companies are after, and those are the people who are being targeted for the purposes of switching.

The Secretary of State is right—it will make a great difference if we can get community switching on the go and target the fuel poor—but he will have to change the energy companies’ thinking, and ensure that not just the well-off but the fuel-poor are taken on board.

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Unless that happens, community switching will make no difference. However, I do not oppose what the Secretary of State said. It interested me, and I should like to see how it works out.

Let me return to the issue of off-grid gas, which affects my constituency and, indeed, much of rural Scotland. While 15% of the households that are on the gas grid are in fuel poverty, the figure rises to 32% for those that are off grid. The Government should think about ways of getting into that market and doing something about it. In my own private Member’s Bill, I suggested that one way of helping everyone quickly, particularly pensioners, was to bring forward the payment of the winter fuel allowance. My suggestion was never debated, because the Tory Whips objected to it for their own reasons, and the previous Bill was talked out. I have raised the matter time and again in the last Parliament and in this one, and I am still waiting for a member of the past or the present Government to explain why my suggestion cannot be considered or even debated.

It is not always the huge changes that make a difference; we can make a difference by means of small, incremental changes. They may not be revolutionary, but they will help, and any help during the coming winter will be very welcome to pensioners and those in fuel poverty. Although the great schemes all sound grand, it may be years before any of them actually makes a difference, and people are suffering from fuel poverty now. As a Labour Member pointed out earlier, a cold snap is predicted for the end of this week. Winter is approaching, energy bills are creeping up, and people are worrying about how they will pay them.

Rather than talk of, for instance, getting rid of Ofgem, we need action. As I have said, small incremental steps can make a difference, but the Secretary of State—the Government—should tell the energy companies that unless they address the problem, there will be stronger action. The Prime Minister promised legislation to put people on to the lowest tariffs, but that seemed to unravel in hours rather than days, and we are still none the wiser about what will be in the Energy Bill. Ofgem’s proposals at least had the benefit of being better thought out, but they too rely on switching and making tariffs simpler. Unless we reach the people who are suffering from fuel poverty and who are at the bottom of the heap as far as the companies are concerned, those changes will make no difference.

I urge the Secretary of State to speak to his colleagues in the Treasury and the Department for Work and Pensions, and to consider measures such as bringing forward the winter fuel payments for pensioners off grid. Such small steps will make a difference, and they will make a difference now.

2.17 pm

Gordon Birtwistle (Burnley) (LD): The problem is that electricity suppliers buy the fuel that produces the electricity from the world markets. Gas, oil and other fuel supplies are bought on the open market: the gas supplied in Russia, for example, can be sold to the United Kingdom, or indeed to any country, at a price. When the price of gas rises, the end result is that the price of electricity also rises, and the same applies to oil.

Caroline Flint: The price can go down as well.

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Gordon Birtwistle: That is true, but my point is that fuel is bought and sold on the open market. We need to ensure that the supply of both gas and nuclear fuel in this country is secure for the long term. We do not want to rely on foreign suppliers, because that could bring about a situation similar to that in Chechnya when the Russians turned the gas off.

Barry Gardiner: The hon. Gentleman is right to focus on security of supply, which is an essential part of the future of the market. He said that the price of gas would go up and down in accordance with the cost of procuring it on the open market. Can he explain why the wholesalers who generate the electricity by means of that gas do not drop their retail prices when wholesale prices have dropped in the international markets?

Mr Deputy Speaker (Mr Lindsay Hoyle): Order. May I remind those who continue to intervene that they will be placed at the bottom of the list rather than the top, because they have already spoken? I am sure that they will want to save something for their speeches.

Gordon Birtwistle: I take the hon. Gentleman’s point, and I agree with him. Maybe it takes a while for the price of gas to go down. Gas is bought in advance, and gas bought six months hence could be a lot cheaper than that bought now, but the expensive gas might have to be used up before the cheaper gas can be used. I do not know the gas market; I am only trying to make the point that we are in a world market and we buy in those markets.

As for the idea of pooling—a suggestion made by the Opposition Front-Bench team—who will be the suppliers? We do not know who they are. That is an issue, but the main issue is that we have to be able to understand the tariffs. I do not understand the tariffs. I have been with the same supplier since I signed up many, many years ago. I buy my gas and electricity from British Gas, because it tells me that I am getting the best deal. Every time British Gas changes the tariff, it tells me what the tariff is and assures me that, because I am a loyal customer, I am on the bottom deal. I have never checked: I believe British Gas and I accept what it says, because basically I cannot be bothered to have a look. However, at the end of the day, we have to resolve the issue by ensuring that the people who can be bothered have a chance to do that, if they are able. The collective switching arrangement that has been suggested by the Secretary of State is an extremely good idea—certainly the arrangement is extremely good for Cornwall, where everybody can take advice from a switching consortium, as is the arrangement taken up in Oldham only yesterday. Indeed, the same thing can take place right across the country.

If I remember rightly, many years ago we had things called co-ops. We used to buy from the co-operative, which had itself made purchases, with discounts given through the system. I remember that my mother’s divvy number was No. 50, and we got a divvy every year from the savings that the co-op had achieved by buying in bulk and selling to the general public.

In the time I have left, I would like to talk about the real way to save money on electricity: by using less. If people use less, they obviously pay less. I would like to mention a scheme from my constituency of Burnley,

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where well over 15,000 properties got solid-wall insulation from outside cladding. It was done in co-operation with the Government, British Gas and the registered social landlord that owned the properties, a company called Calico. I took great notice of what happened—it was the biggest scheme in the UK, I was told—and I have since followed it up and visited quite a number of people who had their properties done. I said to them, “Apart from the house looking a lot better than before—you’ve had the outside cladding done, your roof spaces all clad and all the new boilers fitted—can you tell me whether you have had a substantial change in your electricity bill?” The first gentleman I spoke to said to me, “The house is now so warm that I’ve persuaded my wife to turn the thermostat down, which in itself is a major achievement. I had my loft space insulated and my wife volunteered to turn down the thermostat, because it was now too warm to wear the extra jumper that she was wearing.”

When I asked people, “So have you found that by turning your thermostat down you have seen a major saving?” the answer every time was “Yes, and a substantial saving.” In one case, the gentleman had taken a note of the savings he had made, which were approaching 30%. No matter what tariff someone is on, no matter where they look for discounts and no matter what allowances are made for certain people, they will never, ever be able to get a 30% discount. The Government could not fund a 30% discount, the companies supplying the electricity could not give a discount of 30% and the tariff changes will never give a 30% discount. I believe that the way forward and the way to save money is to spend money on cavity-wall insulation—the outside stuff: I am not keen on filling the cavity with insulation, because that creates damp—plus everything that goes inside, plus the new high-efficiency boilers. That is why I welcome what happened in Burnley and why I welcome the new green deal, which will enable RSLs to provide such insulation on the properties they rent out, particularly in my constituency. I do not really accept that what is in today’s motion will change things.

Finally, on Ofgem, I have to say that I am definitely anti-quango. We have far too many quangos. The day we get rid of 90% of the quangos will be the day I can leave this place and say that I have really done something. However, we do not replace a quango that is inefficient with another quango. The way to do it is to get the existing quango to do its job. I hope that the Secretary of State will lean on Ofgem and make it do what it is paid to do and make it deliver to the general public what it is supposed to deliver. If Ofgem is not doing that, we should not change it, but get rid of the people in it who are not performing and replace them with people who will deliver what Ofgem is supposed to deliver.

Several hon. Members rose

Mr Deputy Speaker (Mr Lindsay Hoyle): Order. I am going to have to drop the limit to six minutes to get everybody in. [Interruption.] It is no use sighing with great disdain. If Members were a bit more careful and took up less time with interventions, this would not have happened. Let me remind Members: if you want to speak, try not to intervene; and if you do intervene, understand that you will end up at the bottom of the list.

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2.25 pm

Dr Alan Whitehead (Southampton, Test) (Lab): When the Government announced that they were going to introduce electricity market reform and publish a White Paper and a Bill, I was pretty excited, because I thought it would be an opportunity to reform the way the electricity market works—or rather does not work—in delivering choice and providing for entry to the market and price stability, as a result of competition, and how it might do that in future on a low-carbon basis. In truth, however, we see from the electricity market reform Bill that is coming forward that there will be no reform of the electricity market. In fact, the Bill that is coming our way ought to be called the “Additions and wheezes to try to make the existing market work rather better, particularly as it refers to lower-carbon energy” Bill, because that is in practice what is happening—that is what is before us at the moment. The Secretary of State appears to be happy to go along with that, not only in not reforming the electricity market at all, but by relying on a wonky grasp of history to reject alternatives ways in which the market might work to secure better competition, a better level of entry and an end to the vertical integration that has plagued the market over recent years.

The pool has been mentioned this afternoon, but the pool as was—up to 2000, when it was abolished—was in fact never a full pool. Something like 90% of bilateral trades were allowed to escape the consequences of the pool, and for most of its time it had only two generators—and sometimes three—for the wholesale end of the market. Circumstances are fundamentally different today, inasmuch as one thing has remained constant. Most trades escape the day-ahead market and are done bilaterally—and completely non-transparently, in defiance, essentially, of what the market was supposed to do—and those who generate the power have an overwhelming stranglehold on the retail market. The market is vertically integrated to the extent that an awful lot of deals take place not between people, but within a company.

Consequently, the market simply does not work; it does not keep bills down, get new entrants in and work properly for consumers. The idea of a modern pool therefore seems essential to moving the market forward. A pooling arrangement would separate who sells into the market from who buys out of it. Such a system, as put forward by the Opposition as part of their proposals for real electricity market reform, can on the basis of a low-carbon and a high-carbon pool ensure a proper market for those low-carbon generators that are independent of the vertical integration that goes on elsewhere.

What I find truly dispiriting is that the electricity market reforms proposals as they stand will end any obligation to purchase any power from low-carbon and renewable generators in 2017. As a result, vertical integration is likely to proceed apace into the areas of some independent entry among low-carbon generation providers. With the ending of the renewable obligation in 2017 goes the ending of any power purchase agreements, which have given people certainty that they might be able to sell the power they generate on a low-carbon basis into the market. Surprise, surprise, the only people who will be likely to offer anything like a power purchase agreement once the renewable obligation has gone will be the very companies that are integrated into the market at the

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moment. Therefore, the prospect before us is of further vertical integration of the market as so-called electricity market reform proceeds.

We have to break that cycle. Over and above the half-hour settlements, the only way we can do so within the central trading arrangements in the market is to ensure that all trades are conducted within a pool system and are completely transparent and completely contestable both ways—low carbon or high carbon. That system would make eminent and straightforward common sense given the current failure of the electricity market.

If we do not address this problem in our reforms, we will live to regret it, because we will not have given ourselves the opportunity to introduce a key instrument that can bring about price discovery and stability and competition in the market. If that is what we want, we will be sorely disappointed as the market will subsequently fail to protect both the consumer and routes for new entrants to make their way into the market and to provide greater choice for the future. I urge Members to take careful note of the proposals both for that reason and because we want a stable market for the future which provides low-carbon energy.

2.31 pm

Guy Opperman (Hexham) (Con): I would suggest that fuel poverty and energy prices are apolitical, cross-party issues. These matters greatly affect the residents of Northumberland whom I and my colleague on the Opposition Benches, the hon. Member for Wansbeck (Ian Lavery), represent. Successive Governments have, to their credit, tried to address the problems. I do not come here to criticise the previous Government. As I have made clear to the shadow Secretary of State, the right hon. Member for Don Valley (Caroline Flint), there is much that could be said on that, but I am more interested in how we should proceed.

I wholeheartedly welcome the current Government’s decision to address the issues we face robustly and properly. It is good that we are seeking greater transparency and competition, and greater opportunity for people to have cheaper energy. Much of this debate has focused on electricity, of course, as it is the primary source of power, but I want to talk, too, about heating oil, liquefied petroleum gas, biomass and shale gas.

I support this Government’s efforts to explore shale gas provision through the Department for Environment, Food and Rural Affairs as well as the Department of Energy and Climate Change, and to try to make the most of the fact that we have so much potential shale gas power. It has transformed the energy market in the United States of America. If we do not push forward with this, we will have to face up to the consequences. We must proceed in an environmentally sound way, of course, but we should be pursuing the shale gas option.

I listened very carefully to the shadow Secretary of State’s weighty and lengthy speech. I must point out, however, that it is undoubtedly the case that the reduction in tariffs now being sought was most certainly not sought by the Leader of the Opposition when he was Labour Energy Secretary. He could have legislated for Ofgem to act, as the current Government are now doing.

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The motion talks about those aged 75 and over, which I welcome, but we are addressing these issues as they impact on everybody, not just the over-75s. In the main energy market, it is true that there used to be 14 major competitor companies and there are now just six. The heating oil market is important in Northumberland, and there used to be 17 different providers in the Northumberland area, but due to the way the market was—supposedly—being run by the previous Labour Secretary of State, they were amalgamated and the amount of competition rapidly reduced. Similarly, there is now a single provider of LPG in my area and to the west of the region; there is no competition whatever. This market is manifestly broken, therefore, and I welcome the action that has been taken.

The hon. Member for Southampton, Test (Dr Whitehead) is clearly very learned in respect of the issues under discussion. He talked about a modern version of the pool—that sounds like something somebody would propose for planning permission—but that was scrapped in 2000, and neither was it in the 2010 Labour party manifesto. [Interruption.] I am not going to get into this topic now; I look forward to hearing evidence to the contrary in the winding-up speeches—when it will, perhaps, be pointed out to me exactly where in Labour’s 2010 manifesto is the proposal to establish the brave, modern pool features.

I have one particular criticism of the policy of the current Government, however. It is to do with the provision of biomass, whether by way of companies or households. I should declare an interest in that there is a company called EGGER in my constituency, which employs more than 400 people, and it is materially affected—as are vast numbers of other people—by the fact that the state continues to subsidise domestic purchase of biomass so that those who wish to purchase timber and other core products are priced out of the market. This is a cross-party issue which I and others have raised with the relevant Ministers and Secretaries of State, but we must address the fact that energy is currently costing more because we are subsidising it, and that subsidy could be got rid of. Renewables obligation certificates could be reformed so that imported timber is subject to a subsidy, but domestic timber is not. That would save taxpayers’ money. It would allow a level playing field for the use of the core product and it would allow businesses to prosper and move forward in the right way.

I will reject the motion, therefore, as it is manifestly wrong, and I will support the Government.

2.37 pm

Mr Tom Clarke (Coatbridge, Chryston and Bellshill) (Lab): In order to save time, and to help those on the Government Members who might be tempted to intervene on me, let me say that I will be making the same kind of speech that I have made for the past six or seven years, although progress has been nothing like I would have liked. However, I support the motion, of course, as its proposals are radical, relevant and realistic.

I urge the House to look at the situation we now face. I found it chilling to read in this morning’s Order Paper an early-day motion entitled, “Excess Winter Deaths.” It points out that there are

“30,000 excess winter deaths each year in the UK”.

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That alone is a powerful argument for saying we should address the real problems. The early-day motion also says that the cost

“has been estimated by the Chief Medical Officer at £890 million per year in England alone”.

That is another price we are paying for the current situation.

This is a real problem for my constituents. Of course we can make great statements about the markets and talk about who did and did not intervene, but the reality is that we find ourselves in the current situation because we have left so much to the markets over the years and because the regulators either do not have the power to act or do not seek to use the power. I want, as I did when we had a Labour Government, to change that.

What is the reality of the situation? In a recent poll, 90% of people surveyed claim that they are concerned about their energy bills, and continued rocketing prices mean that this is now the top household worry. Even worse is to come, as it is predicted that half the population will be in fuel poverty by the end of this year. That is a very sobering figure. About 2 million more people are experiencing fuel poverty than when I first secured a debate in Westminster Hall about six years ago. Eight years ago, the average household spent £522 a year on electricity and gas, but the figure has now risen to a staggering £1,232. That is an average increase of 140%, whereas average household income increased by a mere 20% during the same period.

People on low incomes, single parents, people with disabilities and many others are terribly worried about what is going to happen this winter. I had hoped that, arising from our debate, we might have been able to offer more hope than I have been convinced has been offered so far. The price of no other commodity has risen so steeply as that of energy. Consumers have been hit with huge energy price increases and they are powerless to do anything other than suffer in fuel poverty in increasing numbers, which is wholly unacceptable. New research has shown that half the population will be in fuel poverty by the end of this year. I know that I am citing statistics, but I plead with the House to remember that this is all about individuals and families; it is about ordinary households in our constituencies. On average, 37% of consumers are spending more than 10% of their income on gas and electricity bills, and the figure will rise by a further 13% by the end of 2012, leaving 30 million people falling into the defined category.

So there is a problem, and it does call for transparency, for improving competition and for driving down energy bills. The average energy bill doubled in the past seven years, and 2 million more people are experiencing fuel poverty. I support, profoundly, everything the Labour Government did to give heating grants and so on, particularly given the problems faced by pensioners. However, I do not believe that it is the role of government to look at the profits that the energy companies are making and say, “We should be subsidising them.”

That is the reality of the situation. What can we do about it? We have to act and we must have real regulation. In the limited time left available, I have to say that I do not believe that Ofgem has the confidence of consumers to the extent that I would want to trust it with the role that it has. There ought to be a new role for people who are given real teeth to deal with an absolutely scandalous

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problem, which is predictable and predicted. People should not be suffering this winter. We can avoid that and we can do so through a rational approach to energy policy.

2.43 pm

Ian Swales (Redcar) (LD): I want to discuss the part of the motion that talks about

“allowing new businesses to enter the market”.

I would have used the word “encouraging” rather than “allowing”, but I support that section and the Government’s efforts in that direction. Last week, in Seoul, South Korea, a deal was signed by the Minister of State, Foreign and Commonwealth Office, my right hon. Friend the Member for East Devon (Mr Swire), the British ambassador to South Korea, and the chief executives of Korean South-East Power, Daewoo Securities and Eco-Frontier. The deal was signed with the UK company MGT Power to build a new 300 MW biomass power station at Teesport in my constituency, at an estimated cost of £500 million. The deal is being announced today, and the whole House should welcome the investment by ambitious Korean companies in the UK energy sector.

Last week, the House debated the Infrastructure (Financial Assistance) Bill. The support it provides will, no doubt, aid investment by new players, and it represents another move by this Government to encourage new projects. The measures were rightly supported by the whole House.

The Minister of State, Department of Energy and Climate Change (Gregory Barker): May I just tell the House that I returned last night from Korea, having been there for the PRECOP—pre-conference of the parties—talks? I wish to pay tribute to my hon. Friend’s role, as the constituency Member of Parliament, in helping to attract some substantial and welcome investment.

Ian Swales: I thank the Minister for that approbation. Such investment is all good news, but to encourage new investors, especially green investors, we need clarity of policy, simplicity of policy and, above all, certainty of policy over the long term. Any arrangements made must be grandfathered over the period of a project. I wish to say a bit more about green investment, because one of the key features for investors is political risk. Gyrations in policy have seriously damaged the nascent biofuels industry in the past decade, and we must remember that policy can emerge independently in both Westminster and Brussels. Without giving too much encouragement to hon. Members sitting behind me, I believe that we must sometimes stop the change and the conflicting policies emerging from over the water—we are dealing with one such policy on biofuels right now.

Tom Greatrex (Rutherglen and Hamilton West) (Lab/Co-op): The hon. Gentleman mentions Brussels, and he, like me, is a strong supporter of carbon capture and storage technology; I not sure whether he was about to make some remarks about it. Given what he has just said, does he share my concern about today’s suggestion by his Lib Dem MEP colleague Chris Davies that the NER300 money that was supposed to be available for potential UK CCS projects is now not going to be available? Chris Davies said:

“Carbon capture and storage blocked. UK to lose out on €600 million”

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and that this

“is a major defeat for Lib Dems”.

Does the hon. Gentleman share my concern about that? Does he want the Minister to respond to it?

Ian Swales: The shadow Minister is raising an issue that I knew nothing about. If he is right, that does sound disappointing. However, I need to go away and look at the details.

Not dealing with long-term political risk will make potential investors simply go away. Alternatively, they will charge a huge risk premium, which may in turn make many schemes not viable. The recent whispering campaign against this Government’s green policies from some quarters has been particularly unhelpful.

I agree with what has been said about the problem of the market between generators and suppliers, and between the sellers and the customers. I spent the first five years of my career in the Yorkshire Electricity Board, which was a monopoly supplier to that part of the world and was buying from a monopoly producer, the Central Electricity Generating Board. So I am well aware of how inefficient such markets are. Despite our criticisms today, I think that we are in a lot better place now than we were at that time.

Encouraging new investment in energy is good for UK business and good for growth. I know that because I see it in my constituency, where, as well as the project that has been mentioned, Ensus runs the largest bioethanol plant in Europe, which has recently restarted; Northumbrian Water has invested £60 million in an anaerobic digestion power generation unit; and EDF is, right now, building 27 giant wind turbines just off Redcar beach.

One part of the Teesside carbon capture and storage project is for International Power to bring its mothballed 1.8 GW gas-fired power station at Wilton back online, and I hope that the current bid in the UK will be successful. The recent Ensus 12-month shutdown was salutary. I made a ten-minute rule Bill speech on bioethanol in this House some time ago, highlighting four different areas of Government policy that were causing problems for that industry. I am delighted that the plant has restarted, but as I said, the recent news from Brussels about indirect land use legislation and proposed new tariffs is extremely unhelpful when people have put £300 million into a long-term investment.

All such projects are for the long term; nobody makes a fast buck on these investments. So the Government must be focused on the long term—far longer than a single Parliament. I am confident that Ministers understand that, that they will put long-term legal, financial and regulatory measures in place, and that they know how important energy investment is to economic growth. So I will be supporting those Ministers in the Lobby today.

2.49 pm

Gavin Shuker (Luton South) (Lab/Co-op): I am extremely grateful to be called to speak in the debate, Mr Deputy Speaker.

I do not take my energy from one of the big six, so in a sense, for the first time in my life, I am not one of the 99% but one of the 1%, but I recognise that most of us do not even know which of the big six we are with, because someone else in the household deals with that,

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and many of us do not look regularly to switch. It was interesting to hear the Minister so keen to talk about switching, as though it were the be-all and end-all of energy reform, but we all know that a range of measures is needed.

I intend to make three brief but, I hope, helpful points. We need a short, a medium and a long-term approach. Looking at the short term, where do we stand today? Many of our constituents face a real cost of living crisis: their bills are going up and their wages are stagnant—if they have a job, that is. Despite the recent changes in the economy, unemployment continues to be persistently high. Young people have to pay for energy, but youth unemployment is high. Times are tough for everyone, whatever their economic position—commuters’ rail fares are going up, water bills are increasing, and the cost of living generally is quite high—and energy must be viewed in that context. There is a specific reason why the current energy price increases are so egregious: it is a matter not just of the figures, but of the economic backdrop.

Growth is flatlining. Since the review two years ago, the economy has shrunk by 0.4%. One of the best ways to deal with the problem is, of course, to get economic growth going and get a rise in real-terms living wages for people, but that is not happening at the moment. Against that backdrop, it becomes all the more important that we, this House, convince the energy companies that we are serious when we say we want change and we want consumers—our constituents—to benefit in the same way as the companies have benefited. That is why the botched announcement by the Prime Minister last week was so serious: it was an example not just of the shambles and U-turns that seem to be happening, but of the Prime Minister not understanding his power to put pressure on the energy companies.

A year ago, when the state of the market was similar—prices were going up but not coming down sharply enough—the Government clearly believed that by putting indirect pressure on the energy companies, they could get change. The former Secretary of State for Energy and Climate Change, the right hon. Member for Eastleigh (Chris Huhne), gathered the big six together for a Downing street gaggle. That resulted in a series of announcements, but a year down the line, the problems have only got worse. The short term is important.

In the medium term, we need market reform. Energy is an incredibly powerful resource. I do not mean only the energy that allows us to manufacture or to heat our homes. I mean the word in the purest political sense, which includes big and powerful entities. It is not for no reason that in recent times we have fought and drawn ideological lines about where energy companies should sit and where the means of manufacture should reside politically.

We need to get suppliers to pool power generation. We need Ofgem—or its successor body, if my party wins the next general election—to achieve real change in the industry. It must carry a stick as well as a carrot and be able to say, “We need proper market reform.” We also need a debate about the social expectations we have of energy companies. I feel uncomfortable about the Government directly subsidising the fulfilment of many of the social responsibilities to which the energy companies,

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which have had a very good run over the past 20 to 25 years, should be responding themselves. It cannot be all about switching, although I welcome the Labour party’s “Switch Together” initiative. Fair markets are the key to customer buy-in, which is essential if the energy companies are to have a sustainable business model. Doing the right thing is therefore good business sense.

Right hon. and hon. Members know the long-term challenges. Often we do not get caught up in talking about them and instead focus on the short-term politics, but there is a clear and consistent direction of travel: climate change and our domestic energy security require us to make significant changes to our markets. Building on the previous Government’s success, this Government have introduced a range of initiatives, including energy efficiency measures and the green deal. Although we have expressed our concerns about the green deal, we welcome the Government’s direction of travel.

Most important of all, though, is how we achieve our aims while also achieving affordability. There is only one answer: to make sure that energy markets and energy reform are such that there is customer buy-in and confidence, measured by the bottom line on their bills. Switching alone is not sufficient to achieve that. That is why I believe radical action is needed and why I welcome the radical action being taken by those on my party’s Front Bench.

2.55 pm

Justin Tomlinson (North Swindon) (Con): It is a pleasure to follow the hon. Member for Luton South (Gavin Shuker), who spoke from the perspective of the consumer. I, too, will focus on that viewpoint. I welcome the fact that the Government are to use the Energy Bill to get consumers the best deal on their energy. Today, I want to discuss some of the specific measures.

Many hon. Members have talked about simpler tariffs. In 2011, Ofgem proposed that each supplier be required to offer one standard tariff for each payment type. Martin Lewis of MoneySavingExpert.com conducted a survey of 3,500 people on what they wanted. They were given three choices: lots of choice—there are already hundreds of different tariffs and unravelling them is an extremely complicated process—a few simple tariffs, or one flat rate per company. In the responses, 18% voted for lots of choice, 37% for a few simple tariffs and 46% for one flat rate per company. That shows clearly that the Prime Minister was on to something. Consumers do not want to be diddled—[Interruption.] The shadow Secretary of State, the right hon. Member for Don Valley (Caroline Flint), claims that we are out of touch, but I think the evidence shows that that is nonsense.

A number of people have asked why fewer people are looking to switch. One of the answers is welcome—it is a result of reducing the use of the aggressive and misleading door-to-door sales techniques that used to go on. We are thankful for that. I have been championing the cause, which is supported by 234 cross-party MPs, of financial education. Working out which is the best deal is a complicated process, so if we can equip the next generation of consumers and make them savvy, financially educated people, more of them will take advantage of the ability to do that.

Another reason is that people have had their fingers burnt. What tends to happen is that a customer is sat on

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one tariff; then, their supplier hikes up the price, which makes them proactive in looking to change supplier. Suppliers that have not already hiked up their prices increase their sales activity, tempting the customer to switch, but a few days later the customer discovers that the new supplier is raising its prices, probably by far more than the old supplier had.

There were welcome moves to put annual energy usage on customers’ bills, giving the information they needed to make comparisons more easily, but now we are all being encouraged to take e-bills. A lot of customers simply cannot remember their password or choose not to access their account, so fewer are getting the information now that it no longer comes on the traditional paper bills sent through the post. Which? carried out a survey—I think the shadow Secretary of State mentioned it—on whether consumers were given accurate information and found that 44% were not. People cannot rely on suppliers to give them the promised price. With Martin Lewis, I have been calling for measures to ensure that people who transfer get that tariff for at least six months, so that they avoid that “sudden price hike three days later” problem. In the current market conditions, people would be sensible to seek a fixed tariff.

There have been some welcome moves. Last December, 4 million of the most vulnerable energy consumers were written to so that they could be given advice. Savvy financial consumers and those who have internet access can find the information, but not all people can do that. The big energy saving week highlighted the issue in the media, and the home heat helpline has helped a considerable number of people by providing independent advice.

I am keen to extend the use of smart meters, so that people can see the tangible cost of their energy usage. One of my colleagues has just moved into a new flat, where there is a pay-as-you-go meter. Since she has had to physically charge up her key with £20 each time, she has made an effort to turn off any electrical appliance that is not needed. That is a good thing, but it also highlights a problem, because a lot of the most vulnerable consumers are on that extremely expensive tariff. We must ensure that vulnerable consumers have access to the cheapest tariffs.

Sir Robert Smith (West Aberdeenshire and Kincardine) (LD): Vulnerable consumers on a payment meter can self-disconnect, without anyone knowing that they are in trouble.

Justin Tomlinson: An apt point.

Businesses that go into administration are in a similar position to vulnerable consumers. Although the law says that businesses that have gone into administration should continue to be supplied, the suppliers will crank up the tariff to the highest level available, further endangering the prospects of that company in financial distress. That is something that I have been working on with R3, the insolvency practitioner representatives.

There is confusion about what is the lowest tariff. We all understand the standard rate charge and unit price, but all consumers are different. Some may opt to pay a premium for a green tariff, for example, or for the different forms of payment. We will need to take that into consideration, but there are examples of how the policy could work. With my mobile phone contract, for example, I regularly get texts from my mobile

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phone company mid-contract, advising me that I could be on a better tariff. By a simple telephone call I am able to change to a better deal without having to extend my contract.

Many speakers have mentioned breaking up the dominance of the big six. I welcome moves to allow more liquidity for independent suppliers and potential new entrants. The hon. Member for Luton South will then not be one of the 1%; he will become part of the majority. We must accept that over the next decade higher global oil and gas prices are to be expected, so we need to get tariffs right not only now, but in the medium and long term. We do not necessarily control our own destiny. We need to control more of our energy supply and have greater energy security. We as a nation should be exporting energy to other countries, the profits of which we can use to subsidise our own consumers.

In conclusion, I echo the words of my hon. Friend the Member for Hexham (Guy Opperman) who said that energy market reform is a step in the right direction. We must show collectively that we are on the side of the consumer. The market is complex and there are vulnerable people who have a vested interest in our getting it right. We must press on and do so.

3.1 pm

Ian Lavery (Wansbeck) (Lab): This debate provides a great opportunity to discuss the Government’s energy policy, which is in a state of total disarray. The Secretary of State says one thing, the Minister says another, the Department says another, and they are all trumped by an out-of-touch Prime Minister.

Let us be honest. The statement made by the Prime Minister last week at Question Time was ridiculous. It probably was not a statement, but it could be described as a reactionary outburst. I enjoyed the urgent question, which was replied to by the Minister of State, Department of Energy and Climate Change, the hon. Member for South Holland and The Deepings (Mr Hayes), a man for whom I have tremendous respect. He valiantly and gallantly supported the Prime Minister, defending the indefensible. It was something that every Member of Parliament would have been pleased to experience. That was a very difficult task.

We are determined to decarbonise our energy sector. We set target after target. We do not have a cohesive energy policy, we do not have a cohesive strategy, yet we set targets in line with commitments that we are not sure we can keep. The Department of Energy and Climate Change is at its lowest point in my time here. There is uncertainty out there among large and small businesses, leading to investment unrest. They are not sure whether the energy plans proposed by the Government will change from one day to the next. There is no evidence-based financial structure to the policies being pursued by the Government. That creates mayhem for businesses that wish to invest in all types of energy in this country, mainly renewables and nuclear. DECC is in meltdown. It has some grand ideas, but the problem is that those seem to be hugely curtailed by the Treasury.

As has been suggested today, there is a huge problem for the coalition partners, who seem to be at odds about all sorts of policies. They are at each other’s throats about energy policy, whether on wind turbines, nuclear or subsidies. We live in a perverse world, with tax cuts

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for the rich and fuel poverty for the poor. This winter people will have to choose whether to eat or to heat, because they cannot afford to keep themselves warm and to keep themselves fed. There are 6.6 million people who cannot afford to heat their homes this year, which will put them at severe risk of health problems.

At the same time as energy companies are inflicting massive hikes on their customers, they are recording massive profits for their shareholders. British Gas increased its prices by 18%, EDF by 15.4%, E.ON by 18.1%, SSE by 18%, Scottish Power by 19% and npower by 15.7%. That is modern-day Britain, divided into those who have and those who have not.

In the time available, I shall focus on the problems of poverty. Research shows that a quarter of all households in England and Wales—5.7 million households—are now in fuel poverty. The proportion of homes in fuel poverty has increased from 18% to 25%. The Hills fuel poverty review warned that unless Ministers change course, 200,000 more people are set to be in fuel poverty in the next four years, and millions of families will be pushed deeper into fuel poverty. There are more frightening statistics. The typical dual fuel bill is up by £200 since the last election to £1,310. More people—up by 25% to 850,000—are in debt to their electricity suppliers. The figure for gas is in the region of 700,000, a rise of 20%. People cannot afford to pay for their energy and are in debt to both the gas and the electricity companies.

I had planned to say much more, but the time allocated to us has been cut substantially, as is normally the case when I get up to speak. There are many topics that we could have discussed. The green deal was touched on. Some of the comments from the Government Benches were wholly incorrect and should be put right on the record. We could have discussed the success of Warm Front, the carbon price floor and the emissions performance standard. Another critical issue is the strike price of the contracts for difference. All these are important, but I wanted to focus on fuel poverty versus the excessive profits being made by the energy companies. We are living in a multi-tier Britain, which we need to highlight.

3.7 pm

Neil Parish (Tiverton and Honiton) (Con): Thank you, Mr Deputy Speaker, for allowing me to speak in the debate. I endorse many of the comments of my hon. Friend the Member for North Swindon (Justin Tomlinson) about the tariffs, the need for competition and the need for people to understand those tariffs. The only way the market will work is by ensuring that there is proper competition and that people are able to switch easily from one company to another, without those companies having tied the consumer in.

The policies of successive Governments, both the Labour Government and this coalition Government, are driving up the price of energy. There must be competition between the companies to keep the overall level down, but in the end consumers will pay more for their gas and electricity. Our green policies are good, but they cost money and they will cost the consumer money. We must be realistic about how we deal with that. I have every sympathy for the fuel poor but the addition of a green tariff is bound to push up energy prices. We need greater competition and we must look after the poorest in society.

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I will now make some specific points. Those who can access pipeline gas to heat their homes, however much the price might have gone up, are actually—dare I say it?—the most fortunate, because those who have oil heating are paying even more. Not only are they paying £1,400 for 2,000 litres of oil, which it does not take the average household long to get through, but they might live in a house that is listed or has traditional windows, which they cannot replace with double glazing, or solid walls, which are very difficult to insulate.

I congratulate the Minister on the money he has put forward to help insulate such properties in rural areas, but I do not believe it is enough. As I said at the start of my remarks, the whole idea is that the green deal is essential because energy prices will continue to rise, but the trouble is that many of my constituents cannot necessarily get the green deal because the figures do not work with the cost of insulating solid walls, for example. Ultimately, those consumers in my constituency and across the country will end up paying more for the insulation than they will save on their energy bills, and that is something we need to deal with.

We talk about competition in the gas and electricity markets, but where is the competition in the heating oil industry? There is virtually none. It is almost a cartel—I can say that in the House—so there is no competition. Two years ago we saw prices almost double when there was snow on the ground. Some of the worst snow in the United Kingdom was in Northern Ireland, but the prices there did not rise as much as they did on most of the rest of the mainland for the simple reason that there is greater competition there because more people have oil-type heating.

The previous Minister referred the oil companies to the Office of Fair Trading. I want that to be pursued, because consumers who cannot get gas must get either liquefied petroleum gas or oil, and LPG is usually dearer than oil and covers the same spectrum of prices. That is absolutely key. I want to see exactly what we will do to help those consumers in my constituency and many other rural constituencies. It is not just rural constituencies; there are old cottages in many town centres across the country and they have to be dealt with. I want to see real progress in that regard.

My final points are on energy security and what we will do in future. It is no good simply saying that we have shale gas; let us actually try to exploit it. Look at what has happened to the gas market in America—I am not suggesting for one moment that we have the same amounts of shale gas—where the price has been reduced by about two thirds. We also have a lot of coal, believe it or not. It is not fashionable to burn coal, but clean coal could be quite effective, and gasification could be another great use of that resource.

Meanwhile, will we rely on gas from the Russians? I spent 10 years in the European Parliament and know that various European countries, especially Poland, do not like the idea of the Russians being able to turn off the gas and hold Europe to ransom. We have the whole mix of energy, but we must face up to the fact that—it is no good the Labour party saying otherwise, because they pursued the same type of policy, which is to drive up energy prices—if we are going to drive up prices, we have to make sure that the poorest in society can get help and that those who are not on mains grid gas have particular help because of the high cost of their bills.

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3.13 pm

Mr William Bain (Glasgow North East) (Lab): With the economy and real wages having shrunk over the past two years, no issue is more important for the living standards of my constituents, and indeed those of all right hon. and hon. Members, than electricity and gas prices. As my hon. Friend the Member for Wansbeck (Ian Lavery) points out, average fuel bills have risen as high as £1,310 a year over the past five years. Prices over the past two years alone have risen by £200, high gas prices could, without adequate action, add £175 to bills by 2020, and wholesale gas costs added £290 to average energy bills between 2004 and 2010. Under the Government’s present policies, the number of tariffs stands at 430; it has risen by 70 in the past year. We have soaring fuel poverty; as many as 3 million elderly people across the country are now affected by it. There are 6,400 over-75s in my constituency alone who would benefit right now from a change of Government and a change of policy to ensure that they are on the lowest possible tariff and have a £200 saving on their electricity and gas bills this year.

The Government have shown in the debate that they simply do not get that a more comprehensive reform of the electricity market is required. They simply do not understand that 54% of the average electricity bill is affected by wholesale energy costs. Our constituents ask, “Why is it that when wholesale energy costs fall our bills do not fall, but when they rise our bills immediately go up?” There is something broken in the electricity supply market. The Government, in their remarks today, simply show no inclination to tackle it.

Sadly, the Government’s policy is marked by shambles and confusion. It seems that the Government are now suffering from the reverse Midas touch; they cannot produce a Budget that stands scrutiny for 24 hours, they cannot run our trains properly and they have made U-turns on forests and on badgers. The joke is that the ghost of John Major is now stalking the Government, and I do not mean the amiable, spectral presence of the Chief Whip, which graced the Chamber a few moments ago. This policy, and the way the Prime Minister mishandled it last week, shows that this is a Government in a state of shambles and breakdown.

Sadly, I must also strike a discordant note with the hon. Member for Angus (Mr Weir), because the Scottish Government are unfortunately letting down my constituents on the issue of fuel poverty. Dr Brenda Boardman, who did so much to coin and develop the concept of fuel poverty, described the Scottish Government’s policies as

“feeble, inadequate and namby-pamby”

and said that they are now putting 800,000 Scots in record fuel poverty. That is at the same time as they are cutting the budget for fuel poverty, which is an area devolved to Holyrood. It is small wonder that Dr Boardman accused the Scottish Government of failing to back up their weasel words with proper actions—something we have seen a lot of in the past few days from the First Minister and Deputy First Minister.

We are also seeing confusion in this Government’s policy. The industry is losing confidence in the Government’s ability to commit to green investment. It is small wonder that we have seen little improvement in our energy mix, as the Chancellor wages an ideological crusade against

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green investment and make outrageous references to the green Taliban. He refuses to capitalise the green investment bank properly and his failure on growth and debt means that the bank will not have proper borrowing powers by 2015. We see shambles, confusion and a disjointed Government.

At the same time, our market is not being reformed. The Institute for Public Policy Research recently produced evidence showing that the least efficient company spends twice as much per customer on its operations as the most efficient company. Some people pay £330 a year more for their electricity and gas than their next-door neighbours, as many as 5 million people across the country are being overcharged and the number of switchers is at an historic low of 15% a year, the lowest since records began in 2003. If the market worked at the moment, competition would ensure convergence on operational costs, but that is not happening at all. In fact, those costs have risen, not fallen, in the past three years, as the IPPR has shown.

We need a radical change of course. We need an arrangement that brings in proper pooling, a new regulator and a much stronger link between the wholesale gas and electricity market and the prices paid by domestic consumers.

3.19 pm

David Mowat (Warrington South) (Con): I want to draw attention to a couple of areas where I agree with Opposition Front Benchers. First, it is clear that the best way of making progress is better insulation. The green deal is fundamental to energy policy, and Ministers need to be accountable for making progress with it. It is also true that we need more transparency in the energy market. The hon. Member for Glasgow North East (Mr Bain) noted that there are 430 separate tariffs; that is unacceptable and it needs to be fixed. I understand that it will be fixed by next summer, but I am disappointed that it is taking so long. I also agree with Opposition Members that the market needs new entrants and that the process of new businesses coming in has been too slow.

Where I disagree with Opposition Members is on their lazy assumption that there is a cartel in operation—leaving aside the fact that that is a criminal offence, and that if they have evidence of it they should take it to the police. I intervened on the Secretary of State to point out that in the gas market we are 26th cheapest out of 27 in the European Union. If that is a cartel, it is not a very effective one. The reason we are so cheap has nothing to do with tax. In France and Germany, gas prices are 60% more expensive than ours, but that is a market effect difference not a tax difference. It would be good if we addressed some of that. On electricity, the position is less clear; our prices are not so cheap. Frankly, that has a lot to do with the decisions that we make in this House and the tariffs we impose on the market.

The gas market and the electricity market are two separate markets. We sometimes talk about them as though they are the same, but they are not. There is an issue with off-grid gas, as we have heard from several Members on both sides of the House. In the case of on-grid gas—Members can, by all means, intervene on me if they disagree, but we have had a three-hour debate that has been broadly fact-free—the evidence is that our prices are not more expensive than anywhere else. Other

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Members have talked about shale gas, and I will not go any further on that, other than to say that this morning, on the Henry hub, US gas prices were one quarter of our gas prices in the European balancing point. That will make a massive difference to the competitiveness of the US economy in a variety of ways. Even if we do not, or cannot, exploit our shale gas to that extent, we need to start to think about the differences in economics that will arise with America.

The three main policy areas in the electricity market are carbon and decarbonisation, which we must achieve, cost, and security. Interestingly, we sometimes assume that we are behind as regards carbon. It is true that we are behind France—with massive amounts of cheap nuclear energy, we use more carbon per head than the French by a long way—but we use a lot less per head than Germany, despite the fact that Germany has four times as much renewable energy as we have, because it continues to burn coal to a massive degree. That is what we need to address in terms of our decarbonisation agenda. The previous Government signed us up for renewables targets that were extremely onerous and will have only a minor impact on the amount of carbon that we use. The country that has reduced its carbon by the most over the past year or so is the United States as it has replaced coal with shale gas.

The big issue is security. Ofgem, which we are giving one of its routine kickings, has said that we will have about 4% surplus electricity capacity by 2015-16. We seem to be in a slow-motion car crash with electricity supply. The likelihood of there not being power cuts by the end of this decade is getting increasingly low. When the House starts to debate that issue, we will begin to make progress on what will really be important. One of the mechanisms by which we can avert this situation is imports. I gently say to the Minister that imports now represent about 10% of electricity in this country. That is a massive policy failure. French nuclear electricity and Dutch electricity is coming to this country, and there are no jobs in that.

I do not have much time to talk about costs. My hon. Friend the Member for Tiverton and Honiton (Neil Parish) made several good points about the somewhat hypocritical tone that this House can have in imposing costs that create fuel poverty and then beating up the people we perceive as being responsible for not somehow wishing those costs away. It is right that we—

Mr Deputy Speaker (Mr Lindsay Hoyle): Order. We have 15 minutes left and three more speakers. I call Jamie Reed.

3.25 pm

Mr Jamie Reed (Copeland) (Lab): Thank you, Mr Deputy Speaker.

Energy costs are soaring and fuel poverty is on the rise. Energy bills are now one of the single largest bills faced by any family. Away from the numbers, what does this mean? It means that in constituencies such as mine across this country, people are choosing to sit in the dark, to sit in the cold, and to fear the winter. It is no exaggeration to state that the choice between heating and eating is a now a reality. At one time, we would have dismissed such a claim as hyperbole, but Members in all parts of the House know that it is true. The consequence

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of higher energy bills, and the across-the-board inflation that they bring to other goods and services such as food prices, is, frankly, that people will die. That is the stark reality of the scale of the challenge facing us as a country as we set about reforming electricity markets.

I cannot speak in this House about energy policy without mentioning the enormous contribution of the late and much missed Malcolm Wicks. He was a tireless campaigner on fuel poverty and a superb Energy Minister, foolishly removed. In 2005, Malcolm brought me, as a new Member of Parliament, into the No. 10 policy unit to help to create the new nuclear policy for this country, and I will always be grateful to him for that. As a national politician, he made a huge difference to the lives of my constituents.

From the outset, and squarely within the national interest, but also in the best interests of my constituents, I offer the new Energy Minister, who is in his place, all the support he could possibly ask for, should he make the right decisions—but, more importantly, should he make them in a timely manner. The truth is that we are running out of time if we are serious about tackling fuel poverty, tackling security of supply—a looming crisis of incredible proportions that this House too readily ignores—and reducing our greenhouse gas emissions.

Wherever energy market reform ends up—I commend the motion in the name of the Leader of the Opposition—the truth that many of us in this House dare not whisper is that the days of cheap energy may well be over. For years, a deregulated market ensured moderately low prices that the consumer could ordinarily accept. Generating companies, which not only sweated their assets but failed to invest during the fat years, now face massive public policy concerns and—let us be clear—massive public policy responsibilities, and in many cases the market wants to reach for the easy options and the quick fixes. It is in this context that we should view fracking for shale gas. The hon. Member for Wealden (Charles Hendry) was right this weekend to warn the Government against betting the farm on shale—it is short-sighted and idiotic to do so. There are no easy ways out of the situation we now find ourselves in, but there are solutions and I will focus on the nuclear industry and nuclear power production in general.

Unlike fossil fuels, nuclear energy is not subject to major price fluctuations. I could say an awful lot more about the benefits of the nuclear industry and nuclear power. Electricity market reform must deliver long-term price stability for consumers and businesses, and it must also ensure long-term revenue stability and predictable returns for investors. Only in this way will we ensure the investment that we need in our nuclear fleet and the investment necessary, in whatever generating form, for the ultimate benefit of our consumers and our society.

The Minister knows that we need new nuclear and that we need it quickly. He knows that over the next 15 years, barring lifetime extensions, we will be down to one operating nuclear station. The heavy lifting on support for nuclear generation has been done already over many years. The public support it, the need is clear and the demand is great, but we must accelerate delivery or else invite collapse. I urge the Government to pay close attention to the evidence given by Vincent de Rivas, the EDF chief executive officer, to the Energy and Climate Change Committee yesterday. He said:

“With investment going in and demand rising we must expect the unit price of electricity to increase over the coming decades.”

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Given that we need that investment, and given that, without question, we need new nuclear, surely the question for Government is: how do we protect the most vulnerable from these rises? This requires a policy response from the Government; it cannot simply be left to the market.

The final investment decision in the first new nuclear reactor at Hinkley will be taken at the end of the year and it is now imperative that the Government do everything they can to assist EDF in making the right investment decision in our national interest. Mr de Rivas said yesterday:

“We are shovel ready. We are on the brink of delivering an infrastructure project similar in scale to the London Olympics. We are poised to deliver immense benefits in terms of jobs, skills and economic growth—locally and nationally.

But like all investors in capital intensive infrastructure projects we need to have a compelling business case. In this respect our final investment decision requires more progress to be made.”

We must please both the consumer and the industries and investors that are ready to help us.

On the vexed issue of subsidy for nuclear, I say to the Minister: do it. I am explicitly pro-subsidy for new nuclear generation, because the reality is that not a single electricity generation source is not subsidised in this country in one way or another. We can call it whatever we like, but the nuclear renaissance in the United Kingdom needs direct Government assistance and I will support any moves to provide it.

Finally, will the Minister say how he will help me to progress new nuclear developments in my own constituency; how we can resolve the mineral rights issues that are affecting them; how we can speedily progress grid connection issues and plutonium re-use; and how we can effectively, assuredly and credibly take forward deep geological disposal with the right, credible partners? Time is of the essence and we have no time to lose.

3.31 pm

Chris Evans (Islwyn) (Lab/Co-op): I declare an interest as a Co-operative Member of Parliament. A year ago we stood here, had the same debate and heard the same stories. We heard that energy companies were always putting their prices up. This year we are back, but what has changed? I read this morning that, last year, 13 pensioners died every hour of cold-related diseases and illnesses. There are about 20 hon. Members present—the equivalent number of pensioners die every two hours.

I am fed up of hearing those on the Government Benches blame the Labour Government for everything. They play the blame game over and over again, yet tonight, in my constituency of Islwyn and in constituencies represented by Government Members, somebody will be wearing their coat to watch television, thinking about going to bed early and not putting an extra bar on their fire because they cannot afford it. That is the reality that they face. They look to this House—to us—to stand up to the energy companies.

I have received e-mails all week as a result of what the Prime Minister said last week. I am afraid that, again, he is offering false hope to all those people who are struggling. It is a crying shame that, when privatisation of the energy markets was first mooted, Members of this House, including Baroness Thatcher, talked grandly about rolling back the frontiers of the state. When she

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did so, I do not think she expected that one company—a monopoly—would be replaced by an oligopoly of six companies, or that the Government would stand back, without teeth.

I have heard Government Members say, “Oh, but we had the energy companies round to 10 Downing street and we told them in no uncertain terms that they have to help the most vulnerable in society.” After 18 individual investigations—by Ofgem, Committees of this House and the European Parliament—does anybody actually believe that the energy companies will listen? Their attitude will be just like that of the boy called into the headmaster’s study at the public school I never went to, who says, “Yes, sir, I promise I’ll never do it again,” and then, when he walks out the door, says, “Don’t worry about him; what’s he going to do to me? Absolutely nothing.”

Caroline Flint: Sounds like the former Chief Whip.

Chris Evans: Yes, that does sound like him.

There has to be a radical reform of our energy market. It is no good going on with only six companies buying in and selling energy. I have talked before about having a central energy supplier to buy energy at a fixed rate and then to sell it to whichever companies want to buy it, so that we can bring more people into the market.

We must talk in the here and now, and we have the draft Energy Bill. Co-operative and community energy programmes have raised massive concerns about the Bill, and I hope that the Government will listen to them. Which? has said that the big switch campaign was the best of its type, but there is still more that we need to do.

A constituent came to see me last Friday and produced a bill from SWALEC. I looked at it and could not understand it. A member of my staff who worked for SWALEC for a number of years looked at it, and he said he could not understand it. Other people looked at it, and they could not understand it. I have read in Which? that a chartered accountant has looked at his own energy bill and not been able to understand it. What chance do elderly people and the most vulnerable in our society have of switching when they cannot understand their bills? I spoke to my member of staff who had worked for SWALEC and said that I would have just offered it a £50 ex gratia payment to go away. That seems to be the way forward for the energy companies. When I looked at that bill, the most amazing thing that I saw was a £15 charge for being a low user. SWALEC was charging my constituent for using less energy. It is crazy.

We have heard that there are 400 tariffs, and the most basic economic argument that anybody could put to the energy companies is that people cannot buy luxury energy. If I go to Currys wanting to buy a television, I might buy one with an LCD, LED or plasma screen, or I might even want an old-fashioned box in my living room. The thing is, I have a choice, because some of them are better-quality products. There is no luxury gas or other energy. We can only use one type to heat our homes, and we have to remember that. People are being ripped off, and it is up to the Government to stand up for them.

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3.36 pm

Barry Gardiner (Brent North) (Lab): If one is going to reform the energy market, it seems to make sense to configure that market according to one’s objectives. When the Secretary of State spoke earlier, it was extraordinary that he did not set out the clear objectives of the reconfigured energy market. I will set out mine.

The first objective is on carbon targets. We have our 2020 targets and our 2030 targets, and the Committee on Climate Change has been clear that we should look to set a target of 40 grams to 60 grams of carbon dioxide per kWh and move towards achieving our renewables targets. If we are to reconfigure the market, let us do it to achieve that objective.

The second objective is on fuel poverty. The price per unit of energy will rise, but fuel poverty must come down. That means that energy efficiency has to be an integral part of the reconfiguration of the market.

Security of supply is the third objective that I wish to put forward. We require a mix of energy from both within and outside the UK. We need both base load sources such as coal and nuclear and intermittent sources such as wind and hydro, as well as dual-purpose sources such as gas.

How do we go about configuring the market in that way? First, I want to hear the Government talking about standards—building standards and product standards. Why is the percentage of excess winter deaths lower in Finland than in the UK? That seems like madness when we compare the climates, unless we understand the importance of the role of building standards. That has to be part of a sensible reconfiguration of energy policy in this country, which cannot be achieved through encouragement and incentivisation alone. We need compulsion to ensure that those standards are driven throughout the market, which the Government have refused to address.

We need honesty. Unit prices for energy will rise, because world demand is rising with increased wealth in Asia, which is a good thing, and with increased global population, which is not such a good thing. That means that we have to structure the market to ensure that it is maximally efficient. Vertical integration allows a company such as Centrica to show obscene profits for its wholesale side, while making what the regulator considers to be “normal” profits in its retail arm of British Gas. Yes, increased liquidity in the forward supply market will help promote competition on the retail side, but it will not solve the abuse that vertical integration is allowing. By tackling that issue, retail unit prices will not rise by as much as they otherwise will—although if we are honest, we should say that they will still rise on a per unit basis.

Security of supply includes the investment of £200 billion over the next decade in our energy network and of £110 billion in our electricity infrastructure. That is to replace the 30% of generation that will go off stream by 2024. We need base load, yet today’s rumour is that the EU new entrants reserve carbon capture and storage project in the constituency of my right hon. Friend the Member for Don Valley (Caroline Flint) will not now proceed because of the Government’s failure either to match fund or to submit the appropriate information to secure the bid. CCS is vital because coal is vital—vital to India and to China—and whatever we do with renewables

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in this country, unless we come up with a CCS solution for coal-fired generation around the world, any paltry reduction in emissions achieved by the UK will not stop climate change. That is why we need a global perspective on our own energy policy. The CCS technology that we can put in place could drive the entire green economy to which both sides of the House claim to have signed up, but of which we see very little evidence.

Nuclear base load is an essential part of the mix, but the Government are set to negotiate a strike price for the nuclear feed-in tariff in the region of £100 per megawatt-hour. The cost of the two EDF reactors at Hinkley Point has risen by £14 billion and is tied in with the strike price. That is madness for a 40-year lifecycle project when onshore wind is already performing at as low as £94 per megawatt-hour, and figures from the Department of Energy and Climate Change suggest that offshore wind will achieve £100 per megawatt-hour by 2020.

3.42 pm

Luciana Berger (Liverpool, Wavertree) (Lab/Co-op): It is one week since the Prime Minister sent the Government’s energy policy spinning into chaos, yet after this afternoon’s debate, I am not sure that we are any closer to knowing what actually is their policy. One thing, however, is clear: the soap opera of the past week has shown that the Prime Minister’s shambolic, “make it up as you go along” approach to energy policy has failed, and will do nothing to help hard-pressed consumers struggling with rising bills this winter.

As my hon. Friend the Member for Wansbeck (Ian Lavery) said, the Government are in disarray over energy. Even the Liberal Democrats did not know what the coalition’s policy was, and during last Thursday’s urgent question, the hon. Member for St Ives (Andrew George) was reduced to asking the Energy Minister:

“Do I understand from his reply…that this is not a firm policy proposal, but merely an item that is currently under consideration?”—[Official Report, 18 October 2012; Vol. 551, c. 490.]

Since that urgent question, neither the Secretary of State nor any Back-Bench Member of the coalition has defended the Prime Minister’s policy announcement that he made last week during Prime Minister’s questions.

Despite the confusion on the Government Benches, we have heard a number of excellent speeches this afternoon. In his response, will the Minister address the serious points raised by a number of Members about the circulating rumours that the UK is set to lose out on up to €600 million for CCS because the Chancellor has blocked the match funding?

Members have rightly highlighted the public’s concern about increased energy prices and the urgent need for Government action to curb those prices. As my hon. Friends the Members for Luton South (Gavin Shuker) and for Islwyn (Chris Evans) said, it is a whole year since the Government’s infamous energy summit. The situation for all our constituents has got worse not better, and it is set to get even worse.

As the hon. Member for Nuneaton (Mr Jones) said, we have a cost-of-living crisis. My hon. Friend the Member for Wansbeck reminded the House that in the two years since the Government were elected, energy bills have risen by £200, with the average household

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now paying more than £1,300 for their dual fuel bill. That was before we heard last week that three of the big energy companies are imposing another round of price hikes, adding a further £100 to people’s bills this winter.

Some 850,000 people are already in debt to their energy companies. My hon. Friends the Members for Glasgow North West (John Robertson) and for Islwyn highlighted in their contributions the shocking prices and conditions that many of their constituents will face this winter. A constituent has e-mailed to tell me that their energy company wrote to them last week to say that their bills will rise by 14.1% for gas and 16.1% for electricity this winter. Faced with those huge increases, it is no wonder the public cannot understand why the Government are not doing anything to help them.

Millions are suffering in fuel poverty, as my hon. Friend the Member for Brent North (Barry Gardiner) and my right hon. Friend the Member for Coatbridge, Chryston and Bellshill (Mr Clarke) said. On this Government’s watch, the number of households spending 10% or more of their disposable income on electricity and gas has increased to one in four—a staggering figure. As my hon. Friend the Member for Wansbeck exposed, that is 5.7 million people. As my hon. Friend the Member for Glasgow North East (Mr Bain) said, 3 million pensioners are in fuel poverty.

What about when people try to switch? The hon. Member for North Swindon (Justin Tomlinson) rightly drew the House’s attention to a recent investigation by Which? showing that a staggering 44% of consumers who called their energy supplier to find out the best deal were not offered it.

In his opening remarks, the Secretary of State mentioned the record of the Labour Government—I am delighted he wanted to talk about the Labour Government, because I am proud of our record. We lifted 1.75 million people out of fuel poverty; an average of 200,000 every year were helped under Warm Front; and 6 million homes were insulated thanks to obligations placed on energy companies. We had the decent homes standard, winter fuel payments and the world’s first climate change legislation.

What have we had from this Government? We have had an energy summit that was nothing more than a photo-op, and a check, switch and insulate campaign that led to fewer people switching suppliers. The number of people getting help through Warm Front, which the Government are scrapping, is down by 80%. We have had an energy efficiency scheme—the green deal—but the Secretary of State’s Department predicts that it will lead to an 83% reduction in the number of people getting loft and cavity wall insulation.

A number of hon. Members, including the hon. Member for Tiverton and Honiton (Neil Parish), made representations on how the golden rule does not stack up. From next year, support for fuel-poor, low-income vulnerable households will halve, with no Treasury-funded scheme to help the fuel-poor for the first time since the 1970s. I do not know about the Secretary of State, but I would rather have Labour’s record than his. Every day the public are paying the price of his incompetence through higher and higher energy bills. It simply is not good enough.

In her opening speech, my right hon. Friend the Member for Don Valley (Caroline Flint) laid out very clearly the problems of how our energy market works.

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There is a lack of competition, with six companies supplying 99% of homes, squeezing out new entrants. We have some of the highest pre-tax energy prices in Europe. The Secretary of State went to great lengths to talk about switching, but on his Government’s watch, the number of people switching supplier is the lowest on record. Bills shoot up when wholesale costs rise, but they never seem to come down when energy prices fall.

No one is saying that the energy market is not complicated, or that changing it is easy. Difficult questions need answering. How do we move from a high-carbon, high-cost economy to a low-carbon, low-cost one? How can we meet our climate change obligations while keeping the lights on? How can we help those who are off-grid as much as those who are on-grid? A number of hon. Members made representations to that effect.

Those are fundamental challenges for the future of our country, but because of the scale of the challenges, we need to raise our ambitions and not lower them. It is not good enough for the Government to stand aside and tell people, “You’re on your own.” The public need a Government who will face these problems head on, not simply accept business as usual, yet all they offer is more of the same.

Despite the Government’s claims to the contrary, the Energy Bill contains nothing fundamentally to change our energy market, nothing to help people who cannot afford to stay warm this winter, nothing to change how power is bought and sold, nothing to support co-operatives or community energy schemes and nothing to make the market more competitive or more transparent. What is needed is proper market reform, not an acceptance of the status quo. Our motion offers real change.

Today’s debate has shown a clear choice between a shambolic, out-of-touch Government making policy on the hoof and lurching from one disaster to the next, a Government whose only answer to rising bills is to tell people they are on their own, and a Labour party that would provide help now for people struggling to keep warm and have the determination to take on the big energy companies and make the market simpler and more responsible. That is the choice hon. Members face when they vote today. I commend the motion to the House.

3.50 pm

The Minister of State, Department of Energy and Climate Change (Mr John Hayes): A long, long time ago, cavemen discovered that flint made fire, but the opening speech by the right hon. Member for Don Valley (Caroline Flint) barely raised a flicker, let alone a flame. I grant that there was a good deal of heat, and she certainly generated plenty of friction, but there was not a gleam of illumination as to why, in power, Labour did so little to deliver the kind of market reform that the hon. Member for Liverpool, Wavertree (Luciana Berger) just claimed was so necessary. Is it any wonder that the right hon. Lady finds herself in the dark shadows of opposition, not the bright light of power?

I say that not in anger but in sorrow—sorrow not only because I know that the right hon. Lady is a great deal more than window dressing, and because she made some strong points about market entry and creating a more plural marketplace to create downward pressure on prices, but because, more profoundly, she knows, and I know she knows, that the debate on energy policy

24 Oct 2012 : Column 979

deserves better than a half-hearted advocacy of a half-baked motion, and because she also knows that the country’s future should be characterised by a cross-party approach and a bound commitment to plotting a path to a future where energy supply is secure; a future where we build an energy infrastructure that is fit for purpose; a future where the vulnerable are protected from unaffordable energy bills; and a future where the needs of the many, not the interests of the few, drive an energy policy that is for the people, not, as was sadly the case under the previous Government, coloured by the demands of the powerful.

Yes, absolutely that means market reform in order to foster clarity and sow certainty so that businesses can make their business plans and invest in the way I described. Yes, it does mean a generation mix sufficient to guarantee resilience and bring security, as my hon. Friend the Member for Tiverton and Honiton (Neil Parish) and the hon. Member for Wansbeck (Ian Lavery) said. It means, too, moving to a market that is more responsive and competitive, as my hon. Friend the Member for Hexham (Guy Opperman) advocated. It also means more nuclear, by the way, as Members who are as great fans of nuclear power as I am will be relieved to hear. And it means communities benefiting, guiding and owning the energy infrastructure, not having infrastructure, such as onshore wind turbines, scattered across our precious land like an atavistic echo of dark satanic mills.

I am reluctant to be too hard on the Opposition, however, because I never seek contumely, as you know, Madam Deputy Speaker, and because I know that they are handicapped by two things, among many. First, they know that tariffs are an important way of driving down the price people pay for heat and light and that the Prime Minister’s intervention and the subsequent discussions have opened up that debate in a new and helpful way. Secondly, they also know that in the 13 years for which they were in control there was none of the landmark legislation necessary to secure our energy future—they dithered, they delayed, they deferred.

Who was the ditherer in chief who presided over this spectacular inaction? It was none other than Disraeli’s new best mate, the Leader of the Opposition. Just a couple of years ago, as Secretary of State for Energy and Climate Change, he told the House that the purpose of his own energy Bill was

“to strengthen Ofgem’s powers in a number of respects and to make it a more proactive regulator”.—[Official Report, 7 January 2010; Vol. 503, c. 254.]

Yet now, when asked what they would do by a hard-pressed pensioner living in fuel poverty, by a hard-pressed farmer facing a cold winter or by a hard-pressed family anticipating Christmas with fear because of energy bills, Labour’s answer is clear as crystal: reform Ofgem and yet again rearrange the regulatory framework to invent a new quango. If they were running Byzantium, they would want it to be more bureaucratic.

In contrast, we will take direct action with a Bill published in weeks, not months, to help people get lower tariffs, using all in our power to address the issues of fuel poverty and bills that are too high for the vulnerable groups that have been supported by so many speakers in the debate. We are also providing immediate

24 Oct 2012 : Column 980

assistance to those who need help with their energy bills through our four-year warm home discount. The previous Government’s voluntary scheme meant that vulnerable people were offered different tariffs simply because they happened to have different energy suppliers, but our mandatory scheme helped 600,000 vulnerable pensioners last year alone through a £120 rebate on their energy bills.

The hon. Member for Liverpool, Wavertree (Luciana Berger) said that she would rather have Labour’s record than ours. Let me tell her that the number of fuel-poor households rose year on year from 2004 to 2009 from 2 million to 5.5 million. That is Labour’s sorry record in defence of the poor.

Neil Parish: DCC plc owned between 40% and 50% of the heating oil market and also trade as BoilerJuice and GB Oils. Will the Minister ask his officials to investigate the dominance in the heating oil market of one particular company?

Mr Hayes: I have to say that in my hon. Friend’s constituency there are really only two principal heating oil suppliers. He is right that that does not create necessary competitive pressure. I shall certainly ask my officials to consider such issues. Indeed, my hon. Friend made a powerful and persuasive speech on the subject during the debate.

We are providing support through the winter fuel payments and cold weather payments, which this Government have increased from £8.50 to £24. I accept that, as the hon. Member for Glasgow North West (John Robertson) and the right hon. Member for Birkenhead (Mr Field) have said, we need to target the support in the most effective way. Through a new obligation from 2013 we will require energy companies to deliver support for heating and insulation for the most vulnerable. This is about demand. As the hon. Member for Burnley (Gordon Birtwistle) said, we have too often debated energy only in terms of production and insufficiently in terms of consumption.

How curious it is that, bedazzled by the glitz and glamour of wealth, the Labour party pandered to corporate power over those 13 years. Keir Hardie must have looked down, wringing his hands in horror. They pander and ponder, bourgeois left minds honed to wander.

As an admirer of Joseph Chamberlain, only in my dreams did I believe that one day I would be the first Tory Minister in decades to advocate tariff reform at this Dispatch Box. Although these are different tariffs and different reform, I am delighted to do so today. I repeat that we will use all in our power to ensure through the Energy Bill that people get the best deal.

That is the difference between my party and the Labour party. We act; they meander, pander and ponder. They want to change the regulations; we want to change the policies. They want a different Ofgem; we want to make a difference to people’s bills.

Mr Reed: I would very much like to sit down with the Minister and discuss the concept of bourgeois left minds. Will he also meet me and the Sellafield workers campaign to talk about the energy policies he is discussing and to expedite new nuclear development in my constituency?

24 Oct 2012 : Column 981

Mr Hayes: I can think of nothing that would give me more delight. I will certainly come to the hon. Gentleman’s constituency.

What gives me the most sorrow about this motion and the Labour party is the fact that with real pathos they have made the worst mistake of all for an Opposition: they have confused opposition with opportunism. They have put party interest above national interest and short-term instincts above long-term interests. They are about fiction, not facts—and for fans of shale gas, friction, not fracts——[Hon. Members: “Oh!”] That one might have been too clever for them. While they face years of hard labour on the Opposition Benches, and—to reference Dylan Thomas, while, rather than raging against the dying of the light, they go gently into that good night—and languish in the darkness, we will bring heat to homes and light to lives through energy policy for the many, not the few.

Question put (Standing Order No. 31(2)), That the original words stand part of the Question.

The House divided:

Ayes 223, Noes 297.

Division No. 85]

[3.59 pm

AYES

Abbott, Ms Diane

Abrahams, Debbie

Ainsworth, rh Mr Bob

Alexander, Heidi

Ali, Rushanara

Anderson, Mr David

Ashworth, Jonathan

Bailey, Mr Adrian

Bain, Mr William

Banks, Gordon

Barron, rh Mr Kevin

Bayley, Hugh

Beckett, rh Margaret

Begg, Dame Anne

Benn, rh Hilary

Benton, Mr Joe

Berger, Luciana

Betts, Mr Clive

Blackman-Woods, Roberta

Blears, rh Hazel

Blomfield, Paul

Blunkett, rh Mr David

Bradshaw, rh Mr Ben

Brennan, Kevin

Brown, Lyn

Brown, rh Mr Nicholas

Brown, Mr Russell

Bryant, Chris

Buck, Ms Karen

Burden, Richard

Byrne, rh Mr Liam

Campbell, Mr Alan

Campbell, Mr Ronnie

Caton, Martin

Chapman, Jenny

Clark, Katy

Clarke, rh Mr Tom

Coaker, Vernon

Coffey, Ann

Connarty, Michael

Cooper, Rosie

Cooper, rh Yvette

Crausby, Mr David

Creagh, Mary

Creasy, Stella

Cruddas, Jon

Cryer, John

Cunningham, Alex

Cunningham, Mr Jim

Cunningham, Sir Tony

Curran, Margaret

Danczuk, Simon

David, Wayne

Davidson, Mr Ian

De Piero, Gloria

Denham, rh Mr John

Dobbin, Jim

Dobson, rh Frank

Dodds, rh Mr Nigel

Donaldson, rh Mr Jeffrey M.

Donohoe, Mr Brian H.

Dowd, Jim

Doyle, Gemma

Dromey, Jack

Dugher, Michael

Durkan, Mark

Eagle, Ms Angela

Eagle, Maria

Efford, Clive

Elliott, Julie

Ellman, Mrs Louise

Engel, Natascha

Esterson, Bill

Evans, Chris

Farrelly, Paul

Field, rh Mr Frank

Fitzpatrick, Jim

Flello, Robert

Flint, rh Caroline

Flynn, Paul

Fovargue, Yvonne

Francis, Dr Hywel

Gardiner, Barry

Gilmore, Sheila

Glass, Pat

Glindon, Mrs Mary

Godsiff, Mr Roger

Goggins, rh Paul

Goodman, Helen

Greatrex, Tom

Green, Kate

Greenwood, Lilian

Gwynne, Andrew

Hain, rh Mr Peter

Hamilton, Mr David

Hamilton, Fabian

Hanson, rh Mr David

Harman, rh Ms Harriet

Harris, Mr Tom

Healey, rh John

Hepburn, Mr Stephen

Hermon, Lady

Heyes, David

Hilling, Julie

Hodge, rh Margaret

Hodgson, Mrs Sharon

Hoey, Kate

Hosie, Stewart

Howarth, rh Mr George

Hunt, Tristram

Irranca-Davies, Huw

Jackson, Glenda

Jamieson, Cathy

Jarvis, Dan

Johnson, rh Alan

Johnson, Diana

Jones, Graham

Jones, Helen

Jones, Mr Kevan

Jones, Susan Elan

Jowell, rh Dame Tessa

Kaufman, rh Sir Gerald

Keeley, Barbara

Khan, rh Sadiq

Lammy, rh Mr David

Lavery, Ian

Lazarowicz, Mark

Leslie, Chris

Lewis, Mr Ivan

Long, Naomi

Love, Mr Andrew

Lucas, Caroline

Lucas, Ian

MacShane, rh Mr Denis

Mactaggart, Fiona

Mahmood, Mr Khalid

Mahmood, Shabana

Malhotra, Seema

Mann, John

Marsden, Mr Gordon

McCabe, Steve

McCann, Mr Michael

McCarthy, Kerry

McClymont, Gregg

McDonagh, Siobhain

McDonnell, Dr Alasdair

McDonnell, John

McFadden, rh Mr Pat

McGovern, Jim

McGuire, rh Mrs Anne

McKechin, Ann

McKenzie, Mr Iain

McKinnell, Catherine

Meacher, rh Mr Michael

Meale, Sir Alan

Mearns, Ian

Miliband, rh David

Miller, Andrew

Mitchell, Austin

Morrice, Graeme

(Livingston)

Morris, Grahame M.

(Easington)

Mudie, Mr George

Munn, Meg

Murphy, rh Mr Jim

Murray, Ian

Nandy, Lisa

Nash, Pamela

Onwurah, Chi

Owen, Albert

Paisley, Ian

Pearce, Teresa

Phillipson, Bridget

Pound, Stephen

Raynsford, rh Mr Nick

Reed, Mr Jamie

Reeves, Rachel

Reynolds, Emma

Ritchie, Ms Margaret

Robertson, Angus

Robertson, John

Robinson, Mr Geoffrey

Rotheram, Steve

Roy, Lindsay

Ruane, Chris

Sarwar, Anas

Seabeck, Alison

Shannon, Jim

Sharma, Mr Virendra

Sheerman, Mr Barry

Sheridan, Jim

Shuker, Gavin

Skinner, Mr Dennis

Slaughter, Mr Andy

Smith, rh Mr Andrew

Smith, Angela

Smith, Nick

Spellar, rh Mr John

Stringer, Graham

Sutcliffe, Mr Gerry

Tami, Mark

Thomas, Mr Gareth

Thornberry, Emily

Timms, rh Stephen

Trickett, Jon

Turner, Karl

Twigg, Derek

Umunna, Mr Chuka

Vaz, Valerie

Walley, Joan

Watts, Mr Dave

Weir, Mr Mike

Whiteford, Dr Eilidh

Whitehead, Dr Alan

Williams, Hywel

Williamson, Chris

Wilson, Phil

Wilson, Sammy

Winnick, Mr David

Winterton, rh Ms Rosie

Wishart, Pete

Woodward, rh Mr Shaun

Wright, David

Wright, Mr Iain

Tellers for the Ayes:

Tom Blenkinsop and

Nic Dakin

NOES

Adams, Nigel

Aldous, Peter

Amess, Mr David

Andrew, Stuart

Bacon, Mr Richard

Baker, Steve

Baldry, Sir Tony

Baldwin, Harriett

Barclay, Stephen

Barker, rh Gregory

Beith, rh Sir Alan

Bellingham, Mr Henry

Beresford, Sir Paul

Berry, Jake

Bingham, Andrew

Binley, Mr Brian

Birtwistle, Gordon

Blackman, Bob

Blunt, Mr Crispin

Bone, Mr Peter

Bottomley, Sir Peter

Brady, Mr Graham

Brake, rh Tom

Bray, Angie

Bridgen, Andrew

Brine, Steve

Brooke, Annette

Browne, Mr Jeremy

Bruce, Fiona

Bruce, rh Sir Malcolm

Buckland, Mr Robert

Burley, Mr Aidan

Burns, Conor

Burns, rh Mr Simon

Burrowes, Mr David

Burt, Alistair

Burt, Lorely

Cairns, Alun

Campbell, rh Sir Menzies

Carmichael, rh Mr Alistair

Carmichael, Neil

Carswell, Mr Douglas

Cash, Mr William

Chishti, Rehman

Clappison, Mr James

Clark, rh Greg

Clarke, rh Mr Kenneth

Clifton-Brown, Geoffrey

Coffey, Dr Thérèse

Collins, Damian

Colvile, Oliver

Cox, Mr Geoffrey

Crabb, Stephen

Crockart, Mike

Crouch, Tracey

Davey, rh Mr Edward

Davies, Glyn

Davies, Philip

Davis, rh Mr David

de Bois, Nick

Dinenage, Caroline

Djanogly, Mr Jonathan

Dorrell, rh Mr Stephen

Dorries, Nadine

Doyle-Price, Jackie

Drax, Richard

Duddridge, James

Duncan, rh Mr Alan

Duncan Smith, rh Mr Iain

Dunne, Mr Philip

Ellis, Michael

Ellison, Jane

Ellwood, Mr Tobias

Elphicke, Charlie

Eustice, George

Evans, Graham

Evans, Jonathan

Evennett, Mr David

Fallon, rh Michael

Farron, Tim

Field, Mark

Foster, rh Mr Don

Fox, rh Dr Liam

Francois, rh Mr Mark

Freeman, George

Freer, Mike

Fuller, Richard

Gale, Sir Roger

Garnier, Sir Edward

Garnier, Mark

Gauke, Mr David

George, Andrew

Gibb, Mr Nick

Gilbert, Stephen

Gillan, rh Mrs Cheryl

Glen, John

Goldsmith, Zac

Graham, Richard

Grant, Mrs Helen

Gray, Mr James

Green, rh Damian

Greening, rh Justine

Grieve, rh Mr Dominic

Griffiths, Andrew

Gummer, Ben

Hames, Duncan

Hammond, Stephen

Hands, Greg

Harper, Mr Mark

Harrington, Richard

Harris, Rebecca

Hart, Simon

Harvey, Sir Nick

Haselhurst, rh Sir Alan

Hayes, Mr John

Heald, Oliver

Heath, Mr David

Hemming, John

Henderson, Gordon

Herbert, rh Nick

Hinds, Damian

Hoban, Mr Mark

Hollingbery, George

Hollobone, Mr Philip

Holloway, Mr Adam

Hopkins, Kris

Horwood, Martin

Howarth, Sir Gerald

Howell, John

Hughes, rh Simon

Huhne, rh Chris

Hunt, rh Mr Jeremy

Huppert, Dr Julian

Hurd, Mr Nick

Jackson, Mr Stewart

James, Margot

Javid, Sajid

Jenkin, Mr Bernard

Johnson, Gareth

Johnson, Joseph

Jones, Andrew

Jones, rh Mr David

Jones, Mr Marcus

Kawczynski, Daniel

Kelly, Chris

Kennedy, rh Mr Charles

Kirby, Simon

Knight, rh Mr Greg

Kwarteng, Kwasi

Laing, Mrs Eleanor

Lancaster, Mark

Lansley, rh Mr Andrew

Latham, Pauline

Laws, rh Mr David

Leadsom, Andrea

Lee, Jessica

Lee, Dr Phillip

Leech, Mr John

Lefroy, Jeremy

Leigh, Mr Edward

Leslie, Charlotte

Letwin, rh Mr Oliver

Lloyd, Stephen

Lopresti, Jack

Lord, Jonathan

Loughton, Tim

Luff, Peter

Macleod, Mary

Main, Mrs Anne

Maude, rh Mr Francis

Maynard, Paul

McCartney, Jason

McCartney, Karl

McIntosh, Miss Anne

McLoughlin, rh Mr Patrick

McPartland, Stephen

McVey, Esther

Menzies, Mark

Miller, rh Maria

Mills, Nigel

Milton, Anne

Mitchell, rh Mr Andrew

Moore, rh Michael

Morgan, Nicky

Morris, Anne Marie

Morris, David

Mosley, Stephen

Mowat, David

Mulholland, Greg

Munt, Tessa

Murray, Sheryll

Murrison, Dr Andrew

Neill, Robert

Newmark, Mr Brooks

Newton, Sarah

Nokes, Caroline

Norman, Jesse

Nuttall, Mr David

Offord, Dr Matthew

Ollerenshaw, Eric

Opperman, Guy

Paice, rh Sir James

Parish, Neil

Patel, Priti

Paterson, rh Mr Owen

Pawsey, Mark

Penning, Mike

Penrose, John

Percy, Andrew

Phillips, Stephen

Pickles, rh Mr Eric

Pincher, Christopher

Poulter, Dr Daniel

Prisk, Mr Mark

Pritchard, Mark

Pugh, John

Raab, Mr Dominic

Randall, rh Mr John

Redwood, rh Mr John

Rees-Mogg, Jacob

Reevell, Simon

Reid, Mr Alan

Robathan, rh Mr Andrew

Robertson, rh Hugh

Robertson, Mr Laurence

Rogerson, Dan

Rudd, Amber

Ruffley, Mr David

Russell, Sir Bob

Rutley, David

Sanders, Mr Adrian

Sandys, Laura

Scott, Mr Lee

Selous, Andrew

Sharma, Alok

Shelbrooke, Alec

Shepherd, Mr Richard

Simpson, Mr Keith

Skidmore, Chris

Smith, Miss Chloe

Smith, Henry

Smith, Julian

Smith, Sir Robert

Soames, rh Nicholas

Soubry, Anna

Spencer, Mr Mark

Stevenson, John

Stewart, Iain

Stewart, Rory

Streeter, Mr Gary

Stride, Mel

Stuart, Mr Graham

Stunell, rh Andrew

Sturdy, Julian

Swales, Ian

Swayne, rh Mr Desmond

Swinson, Jo

Swire, rh Mr Hugo

Syms, Mr Robert

Tapsell, rh Sir Peter

Teather, Sarah

Thurso, John

Timpson, Mr Edward

Tomlinson, Justin

Tredinnick, David

Truss, Elizabeth

Turner, Mr Andrew

Tyrie, Mr Andrew

Uppal, Paul

Vaizey, Mr Edward

Vara, Mr Shailesh

Vickers, Martin

Walker, Mr Charles

Walker, Mr Robin

Ward, Mr David

Watkinson, Angela

Weatherley, Mike

Webb, Steve

Wharton, James

Wheeler, Heather

White, Chris

Whittaker, Craig

Whittingdale, Mr John

Wiggin, Bill

Willetts, rh Mr David

Williams, Roger

Williams, Stephen

Williamson, Gavin

Willott, Jenny

Wilson, Mr Rob

Wollaston, Dr Sarah

Wright, Jeremy

Wright, Simon

Yeo, Mr Tim

Young, rh Sir George

Tellers for the Noes:

Karen Bradley and

Mark Hunter

Question accordingly negatived.

24 Oct 2012 : Column 982

24 Oct 2012 : Column 983

24 Oct 2012 : Column 984

24 Oct 2012 : Column 985

Madam Deputy Speaker (Dawn Primarolo): Before we proceed to the next debate, I have to announce the results of the deferred Division on the Question relating to the draft Housing Benefit (Amendment) Regulations 2012. The Ayes were 260 and the Noes were 206, so the Ayes have it.

[The Division list is published at the end of today’s debates.]

24 Oct 2012 : Column 986

Policing

4.14 pm

Mr David Hanson (Delyn) (Lab): I beg to move,

That this House notes with serious concern the Electoral Reform Society’s warning that the police and crime commissioner elections ‘threaten to result in the lowest turnout of any nationwide election in British history’ following the Government’s decision to hold the elections on 15 November 2012; further notes that the Electoral Reform Society is predicting that turnout will be significantly lower than at the local elections, held in May; believes the Government’s cuts to 15,000 police officers demonstrates its wrong-headed attitude to policing; is concerned about the effect this has on police morale; further notes that Ministers have confirmed that the Government has broken its promise not to cut frontline police officers by taking 6,800 police officers off the front line; is concerned that Government policy is removing crucial tools for the police to catch offenders and tackle crime in the future, such as restricting the use of CCTV and DNA evidence and the abolition of ASBOs; and believes that the Government’s decision to hold elections in November rather than in May wastes public money that should be spent on front line police.

First, may I pay tribute to the work of our police officers, and the police staff who support them and work with them? In keeping our communities safe, it is their job to respond to the calls, investigate crimes and keep our confidence in policing high. In the week that we have debated Hillsborough and the failings associated with it, let us not forget the daily work police officers do, with professionalism and commitment, on our behalf.

I had the privilege of attending last week’s police bravery awards, as did the Minister for Policing and Criminal Justice, whom I congratulate on his appointment to the Privy Council. We listened to tales of outstanding bravery in the face of immense challenges, and the shadow Home Secretary, my right hon. Friend the Member for Normanton, Pontefract and Castleford (Yvette Cooper), and I were astounded by the accounts of police who entered burning buildings, dived into docks and struggled with armed assailants—every day doing the ordinary, but on occasion doing the extraordinary, on our behalf. It was a real honour for us to be there.

It is also important to pay tribute, as we did at York Minster only two or three weeks ago, to those police officers who have died in the line of duty. I must pay tribute to the latest officers killed on duty, Police Constables Nicola Hughes and Fiona Bone. They were two bright young officers, whose promising careers were cut short in a most cowardly and reprehensible way. I hope I speak for the whole House in saying we will never forget them or their service.

We are just three weeks away from the elections for police and crime commissioners in England and Wales on 15 November, and it is worth setting out the situation in regard to them. We are three weeks away from an election few people know about and even fewer understand. We are three weeks away from an election that, in my view, has been handled incompetently by the Government—I do not blame the Minister personally as he has only just been appointed to his post.

The election did not need to be held in November. The Tories are holding it then for the sake of a political fix with their political friends, the Liberal Democrats—who, at the last count, had candidates standing in only 24 of the 41 police areas. Perhaps they were embarrassed by the fact that at the general election they promised 3,000 extra police officers, yet they have presided over a cut of 15,000 police officers to date.