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11.30 am

Mr. Lindsay Hoyle (Chorley) (Lab): I welcome this important Fuel Poverty Bill. The Government have difficulties with the issue, but this is about their committing themselves to overcoming those difficulties. Of course, it is easy to say, “Let’s kill the Bill off on a Friday”, but that is not the way forward. If there are issues or problems, let us deal with them in the proper place—in Committee. I therefore welcome this important private Member’s Bill promoted by the hon. Member for Somerton and Frome (Mr. Heath).

The subject is dear to me and to Members right across the House, regardless of the political divide. We all have one aim, which is to help our constituents, including those in fuel poverty. That is why I was pleased when the Sunday People ran its crucial campaign highlighting the real issues of fuel poverty. Of course, as my hon. Friend the Member for Slough (Fiona Mactaggart) said, one issue is prepaid meters, and the fact that the people who buy prepayment cards are subsidising the rest of us and the energy that we use. Usually, people who are upwardly mobile, most able and wealthiest get the cheapest fuel. It is absolutely absurd that we penalise the poorest in the country. That is what we have allowed the energy companies to do.


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We all have constituents whom we want to talk about. We can all mention cases. I want to talk about E.ON. A constituent of mine struggles to pay their energy bills but does not want a prepayment card, because they know the consequences. First, it will ensure that their energy costs more and, secondly, the cards always run out at the wrong time. People say, “They don’t run out in the middle of the night; don’t worry.” Yes, but next morning, at 8 o’clock, when people are trying to get the kids ready for school, and want a shower or whatever, there is no heating and no lighting. It is not a good way to operate. We are talking about people who struggle, but ensure that they always pay their standing order to E.ON. However, E.ON suddenly put another £100 a month on my constituent’s standing order without telling them. It was absolutely absurd; somebody who struggles to make sure that they pay their energy bills suddenly found that an extra £100 had gone. What happens then? Are the kids to go without their meals, or without the new clothes or the new pair of shoes that they need? That is the consequence of E.ON’s action.

E.ON should have said, “Look, the price of energy has gone up; you may need to consider that. How can we help you?” It does not do that, but it and other energy companies need to do that. They now need to act responsibly, and the Bill will ensure that we can make those companies do so. That is what is wrong with the prepayment cards.

We have rightly touched on storage. The energy companies have failed to create storage capacity in the UK. They have been allowed to find an artificial way of increasing prices in winter, and of creating price spikes due to demand for gas. They have happily been allowing Europe to store it. France and Germany have huge storage capacity, so they buy up our cheap gas in summer, and later export it back to us at a much higher price. That ensures that the energy companies, usually continental, make even more money. We have to deal with excessive profits and immoral wages. That is why I am more than happy for there to be a windfall tax.

Mr. Cox: The hon. Gentleman is making a very good speech. Does he feel, as I do, that there is something anomalous in requiring energy companies to make huge investment in meeting the carbon emissions reduction target, when the cost of that investment is transferred to the customer? That increases the customer’s fuel bill by £38 a year. Does he think that that is the way forward, although it further tops up the expensive energy bills of often poor consumers, or does he think that we should do things differently?

Mr. Hoyle: I believe that we have to get prices down for consumers. The price of energy needs to drop. I am concerned about fuel poverty, and the constituents whom I represent, but I am also concerned about business, which cannot afford energy prices either. Prices have gone through the roof, and there is no justification for it; prices should have dropped for everyone.

We have touched on properties, which are part of the issue. Properties need investment in measures such as double glazing and insulation. We have mentioned all the ways in which we believe that we can help people. The problem is that we have already done that work, in a lot of cases. On social housing estates, council properties
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and former council properties, councils have rightly taken advantage of all the grants available, and have put in double glazing and insulation, and installed modern boilers. The truth is, however, that people cannot afford to put on the boiler. After all that work has been done, they still cannot afford their energy bills. That is the real problem, and it is a dilemma. We have to look at that seriously, and we must seriously do something about it. The cost of energy is the problem.

The Government had an excellent track record on dealing with fuel poverty. We were on target, and were working very hard to reach that target, but two things happened. First, prices went through the roof, and that put many more people into fuel poverty. Secondly, as unemployment rises, more people are put into fuel poverty. That is why we have a dilemma. How do we deal with it? The long-term view taken is, quite rightly, that we must bring properties up to the right standard, to ensure that we can make it cheaper for people to access energy. However, the quick fix is to reduce the price of energy; that is what we really need to do.

Companies do not wish to reduce their prices, but we have a responsibility, and we have to take a hard line with them. Voluntary agreements are wonderful, but they do not quite work. I would say, “Get your act together, and get prices down quickly, especially for electricity, or we will do the one thing that you don’t want us to do: set up a windfall tax.” I believe that that is a way forward. There has to be use of the stick. We have tried the carrot; that does not seem to work.

People have rightly mentioned eaga. We all have horror stories to tell about eaga. In Lancashire, we had a good track record, but all of a sudden, we seem to have more and more problems with, and complaints about, eaga. It is a question of degree.

Janet Anderson: My hon. Friend refers to a matter of concern to all of us in Lancashire. I would like to put on record our thanks to the Under-Secretary of State for Energy and Climate Change, my hon. Friend the Member for Lewisham, Deptford (Joan Ruddock), for agreeing to look at the issue. One of our particular concerns—I should be interested to know whether colleagues have had similar problems—is the number of cases in which people are being told that the maximum grant is not sufficient to cover the work that they need done. I had a case recently in which an elderly woman had to pay an extra £600 to get the work that she needed done to her home.

Mr. Hoyle: I totally agree with that, and with the point that my hon. Friend makes about the Minister. We want to express our real concerns about prices.

Mr. Dismore: I want to make a similar point to that made by my hon. Friend the Member for Rossendale and Darwen (Janet Anderson). The problem is particularly acute in London, where prices are, inevitably, higher across the board. Constituents have written to me saying, “We can’t afford the top-up,” so the work does not get done. I have recently heard an increasing number of complaints about the poor quality of the work done by eaga or its agents. We need to start looking into the
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contract. There is effectively a monopoly in place; we need to ask whether that is the right way to take forward the Warm Homes initiative.

Mr. Hoyle: I absolutely agree with my hon. Friend, and my hon. Friend the Member for Rossendale and Darwen (Janet Anderson). Something does not look quite right; something is beginning to smell fishy about the way in which eaga operates. What causes me concern is that eaga says, “Don’t worry; we tender, and we set out a price.” That all sounds very good, but what it does not say is that when it originally tendered that price, it was up against other companies. It seems strange that when my constituents get the work done—we are basically talking about one radiator and one boiler—they suddenly face a top-up bill of over £1,000. Nobody can understand why. There have been more and more top-ups, so the original price is different from the price that is being charged to the customer.

The fact that eaga gives the work to its own company, Iguana, also leads me to question what is really going on in the system. The company seemed to be a co-operative when it first came about, and now it is on the stock exchange. Who is it working for? I would say that it is working for the shareholders and the directors. Suddenly, those people have come from the energy companies that are causing the problems. They see the process as a gravy train, so they are ripping off not only our constituents, but the Government. That is why there is real concern, and we need to get in there and find out why there are all these complaints, why all these prices are going up so much and why there are so many rip-offs.

I find it absurd, because more often than not when people from the company come to check a boiler when someone has applied for a grant, that boiler is suddenly condemned. I might be doing those people an injustice and I believe that we should put safety first, but when that boiler has a nice gas fire on the front of it, in order to ensure that our constituents have to do something about it, they condemn the boiler, switch off the gas and even take the front off the gas fire and take it away. They have no right to do that, but the constituent is left with two options. If they want heating and hot water, they have to have the grant—or to top it up, because that is where the usual charge comes. That is the only way in which they can get the heating back on. They cannot do anything else. What right do those people have to leave behind the pots of a gas fire and a boiler? They do not take it out, renovate it or repair it. This is about the lack of quality of workmanship. If the gas fire front was left on, at least that would be something nice to look at. This is about the way that the company treats people because it has that monopoly. It thinks that it can treat our constituents any way it wants, but it cannot. We need to stand up to it.

Mr. Dismore: Does my hon. Friend agree that one possible solution would be to allow our constituents, should they be given a quote by eaga that goes beyond the grant, to get an alternative quote from a local plumber or a heating engineer—properly qualified, of course? If that quote is less, they could ask that person to do the work and that person could be reimbursed under the scheme. That seems to me to be a good way of introducing some proper competition into the system.


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Mr. Deputy Speaker (Sir Michael Lord): Order. I am hesitant to interrupt these remarks, because they are broadly speaking within the context of the Bill, but I think that we ought perhaps to remind ourselves that we are talking about a specific measure.

Mr. Hoyle: Thank you, Mr. Deputy Speaker, for those guidelines.

The two issues are interrelated: fuel poverty and people’s ability to afford their energy bills mean that they need new boilers, and that is part of what has been hit. The fact is that we are putting those people into fuel poverty because they cannot afford the top-up and cannot replace the boiler. Someone who goes to the local CORGI-registered firm for an installation can pay half the price—or certainly a lot less—but people are not allowed to use those local firms because the contract has been given to eaga. That is why it needs to be looked at and why there ought to be flexibility in the system. Another problem is that people who are in fuel poverty end up replacing the boiler and are then sold insurance. Somehow, we need to look at this situation, because it is adding to the problems of fuel poverty.

I believe that the Bill is important. I wish it well in its progress, and I hope that in Committee we can reflect on the issues between the Government and the hon. Member for Somerton and Frome. That is where those issues can be overcome. We all want to do the best by our constituents, and that is why this Bill needs to go through to Committee so that we can overcome those issues. I know that the Ministers have sympathy with the aims of the Bill; they should let that sympathy work in Committee rather than block the Bill now. I see no reason for blocking the Bill.

11.44 am

Stephen Pound (Ealing, North) (Lab): As always, it is an honour to follow my hon. Friend the Member for Chorley (Mr. Hoyle). Normally when he speaks, metaphorical thunder and lightening echo around him, but I think I heard a roll of real thunder while he was speaking. I sincerely trust that it was not the aftershock from the underwater Tongan volcano. Knowing my hon. Friend as I do, nothing is impossible. I slightly demur from some of his comments about the eaga partnership. In my constituency, we have had a first-class service from the eaga partnership. Perhaps we are just fortunate; perhaps we are just Ealing—I do not know—but I have always found that its customer satisfaction levels have been high. There have been problems with some subcontractors, but overall eaga has been found to be extremely effective.

That brings us to the business of the day, which is the private Member’s Bill tabled by the hon. Member for Somerset and Frome. May I congratulate him while attempting to pronounce Frome correctly? A look of pain always fizzes across his face when I mispronounce it. [Hon. Members: “It is Somerton.”] Apparently, I have erred not once, but twice. It is not just mea culpa, but mea maxima culpa. I have mispronounced Somerton. Most of us of my generation associate Frome only with Colin Dredge, the late demon of Frome. I have to say that I think that the hon. Member for Somerton and Frome (Mr. Heath) is more decent and diligent than demonic. By way of tribute, if not of recognition,
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I shall try to pronounce the name of his constituency correctly. Those of us from places such as Ealing have no such problem; there is only one way to pronounce it.

The hon. Gentleman has done a massively valuable service to the House and the nation in promoting this Bill today. Whatever happens in the debate about fuel poverty in the future, the debate has been changed. It will be a different debate and that is in no small part due to his work. At the beginning of the debate, he said that he had been “religiously” applying every year for a private Member’s Bill. The thought of him on his knees praying in the Lobby is not one that immediately springs to mind, but many of us will pray that other Members who bring such Bills before the House do as much work and carry out as much due diligence beforehand. It is extremely helpful.

Frank Dobson: Perhaps you could buy indulgences.

Stephen Pound: The Roman Catholic Church does not sell indulgences any more. However, I am always prepared to consider offers.

The hon. Member for Somerton and Frome has raised a vital subject. At the outset, I hope that he will accept—as would everybody—that no Government in the history of this nation have ever done more to combat fuel poverty than this Government. It is interesting to note that none of us disagrees with the main thrust of the Bill. Nobody is speaking up for fuel poverty, except perhaps for a few megalomaniac oligarchs somewhere in the outer reaches of the energy supply chain. We are all united. We simply slightly diverge on how best to achieve those ends.

As a graduate of the London School of Economics, I am always reluctant to use statistics, but the single most chilling statistic—“chilling” is an appropriate word—that one could come across can be found in the official Library figures for the estimated number of households in fuel poverty in the UK. The figure plunged from 6.5 million in 1996 to 2 million in 2003 and 2004 and then started to rise again to 3.5 million in 2006. The reason for that was simple. Energy prices are the main driver of fuel poverty and we know that domestic prices for fuel fell by 17 per cent. in real terms between 1996 and 2003, but increased by 39 per cent. between 2003 and 2006. So, whatever we achieve with the Bill, and whatever the Government’s policies work towards, there will always be the issue—the elephant in the rather chilly room—of fuel costs. They have already been mentioned, and we have to consider them.

My right hon. Friend the Member for Holborn and St. Pancras (Frank Dobson) takes a rather robust view of energy suppliers; I think it involves a measure of capital punishment. I cannot always disagree with him, although other people have suggested introducing windfall taxes. Whatever we do, we will have to consider the issue.

Let us look at what we can do and what we have done, and at how the hon. Gentleman’s Bill can help. Anyone who opposed the Bill would be in the same position as someone who had been photographed kicking a puppy. It is honestly meant, and it is here to help. Everyone is in favour of it; the question is merely how best we can achieve the aim. I do not wish to go into the costs involved, because I think that that subject will be ventilated elsewhere. We have discussed whether the
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figures involved related to the base figures, and we could discuss that for a long time. I think that there is an element of the Bill that remains uncosted.

The hon. Gentleman was quite right to say that the Bill was aspirational, as well as a permissive. It is extremely important that he pointed that out. When he won his place in the ballot, I was surprised that he chose this subject for his Bill. He is known for his interest in constitutional matters of great moment. However, when the House heard him speak today about the reality of fuel poverty, we recognised the passion that flows through his veins and understood why he had chosen to promote this issue.

Mr. Dismore: The hon. Member for Somerton and Frome (Mr. Heath) calls the Bill aspirational and permissive, and I do not think that anyone would object if that were the case. The real problem is that it is not only aspirational and permissive; it is also mandatory. That is the issue that I tried to explore in an earlier intervention. The real difficulty would be that these measures would effectively have to take priority over all the Government’s other priorities, without taking into account all the other things that the Government have to do.

Stephen Pound: I am grateful to my hon. Friend for his intervention; he normally charges for his wise words on a fairly expensive scale. On this occasion, he has raised an important point that I was going to mention later.

What would happen if a Government target were not met? Would the Government have to resign? What would the sanction be? Would the chief executive be dismissed? Heaven fore fend! I think that the hon. Member for Somerton and Frome recognises that this is an issue. Targets are now—sadly, some would say—part of our culture and everyday life. They have a useful role in benchmarking.

Mr. Dismore: The answer to my hon. Friend’s question is that, if the Government were not fulfilling their duty under the Bill, they would be taken to court. That has been attempted before, but under the Bill, it could be done successfully. If, for whatever reason, they were still unable to comply with the provisions, I suppose that, ultimately, the Secretary of State could be found guilty of contempt of court and locked up.

Stephen Pound: The thought of the Secretary of State being banged up might appeal to some Members, although it does not necessarily recommend itself to me. I realise that my right hon. Friend the Member for Holborn and St. Pancras would consider it far too moderate a sanction.

Frank Dobson: As someone who is in favour of getting votes in his constituency, I must rush to point out that I would not like to see the Secretary of State for the Environment, or whatever the post is called these days, banged up, because he is one of my constituents and I assume that he usually votes for me.

Stephen Pound: I am sure that it is unnecessary to point out that, even if that sad eventuality were to come about, the Secretary of State could still vote.


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