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27 Apr 2009 : Column 591

Mary Creagh (Wakefield) (Lab): We know already that flu is the largest vaccine-preventable disease in the UK and the viral load is much higher in children under two, so as we look to the future beyond any immediate danger, will my right hon. Friend consult the Joint Committee on Vaccination and Immunisation and consider an annual flu vaccination programme for children under two, who are more likely to pass the virus on to their families, carers and friends? Such a programme would have the added benefit of scaling up the public health response, which would enable us to respond to the threat in any future pandemic.

Alan Johnson: My hon. Friend raises a more general point about flu inoculation. We give children the flu jab if they are asthmatic and particularly vulnerable to flu. I will talk to my colleagues about how far we can move to a vaccine for those under two years of age. That is an important general point. With reference to swine flu, the antivirals work for children as well. That is very important.

Mr. Hugo Swire (East Devon) (Con): The British pig industry has been having a particularly hard time of it recently, so the chief veterinary officer’s remarks this morning reassuring people about the safety of eating pork were most welcome; only the New Zealand farming industry to date has issued a statement saying, “Don’t stop eating pork.” Has the Secretary of State met his colleague, the Secretary of State for Environment, Food and Rural Affairs, to discuss reassuring the public about the safety of eating pork and, if necessary, diverting funding to promote a safety in eating British pork campaign?

Alan Johnson: I have just spoken to my right hon. Friend, and I will speak to him again at the Cobra meeting immediately following this statement, at which we will discuss that. My right hon. Friend tells me what the hon. Gentleman already knows: we do not have any pigs or pig products from Mexico in the UK.

Lynne Featherstone (Hornsey and Wood Green) (LD): The idea of phoning NHS Direct is very good. NHS Direct would fax the chemist, and the person affected would get a friend to pick up the pills. My concern is that people will be very scared and NHS Direct might be overwhelmed with calls. What preparations have been made for escalating the number of staff responding?

Alan Johnson: That is the next phase. We are not at that phase yet. The hon. Lady rightly points to our plans, if we are at a stage 6 alert and are dealing with a pandemic, in which case we would want everyone, especially those who are elderly and living alone, to have a friend who can go and collect their drugs for them, to avoid people travelling around. We have good plans to ensure that, at that stage, people can access such a distribution system and that it would work. It is important to emphasise that we are not at that level at present, and I hope we never get to that level.

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Cheapest Energy Tariff (Information)

Motion for leave to introduce a Bill (Standing Order No. 23)

4.53 pm

Mr. John Baron (Billericay) (Con): I beg to move,

The idea behind the Bill is relatively simple—too many consumers are paying too much for their energy consumption. Energy companies could do more to provide information to highlight where customers could find cheaper tariffs.

I am grateful for the cross-party support for the Bill, as can be seen from the names of sponsors from both sides of the Chamber. It is supported by those who signed early-day motion 749, from which the Bill is drawn. I welcome Conservative Front Benchers’ support for the Bill. When I raised the matter with the Secretary of State for Energy and Climate Change in the House, he described the idea as “ingenious”. I welcome the third-party support outside this place from groups such as Consumer Focus, Which?, the Energy Action Group, Help the Aged and Age Concern, which have all lent their support to the debate.

The Bill’s aim, I hope, is to help consumers realise that perhaps they need to do more to achieve cheaper tariffs. It is designed to help all consumers, but particularly those in fuel poverty. We know the definition of fuel poverty: 10 per cent. of a household’s income being spent on keeping their living areas warm. It is much easier, however, to quantify the issue itself, because Government figures are at least two years out of date and the independent group Consumer Focus estimates that about 5 million households are in fuel poverty. If we needed evidence of that, we might look only at the winter of 2007-08, when something like 22,000 people over the age of 65 died of a cold-related illness—far more than in many European countries with colder climates.

Constituents often write to me—I am sure I am not the only Member who receives such correspondence—and graphically describe how they have to deal with the effects of high energy and food prices. Indeed, they often have to choose between the two. One constituent said that he could afford only one hot meal a week and lived off biscuits and bread, because he could not afford the high energy prices he was charged.

We know that too few consumers switch between suppliers. Ofgem is looking at the issue and has suggested that an annual prompt, reminding consumers how they can switch from one supplier to another, would be a good idea. Often, however, the problem is that consumers do not know whether they are on the cheapest tariff with the energy company that already supplies them. That is the point of the Bill; it is designed to make all that information much clearer. By way of early-day motion 749 and the Bill, I have suggested that energy companies be obliged to provide information—assuming the customer is on a direct debit and has online access—about whether their consumers are on the company’s
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cheapest available tariff, given their pattern of energy use. There should also be clearer information on energy company bills about whether savings could be accrued if the consumer were to switch to the cheaper tariff.

That is the bare minimum of information, and much more could be included in the energy bill. Certainly, more tariffs, including social tariffs, could be put on bills to ensure that all consumers saw whether they were on the cheapest tariff. The proposal has various advantages: consumers would be able to see how much they might save if they switched; it would act as a reminder and allow people to see whether consumers take advantage of the latest discounts; and it might encourage some consumers to pay by direct debit or set up online access, which could help with their bills, and might even help the energy company itself.

The fact that bills are too complicated is beyond doubt. Which? estimates that, on average, there are 15 tariffs per energy company. If we take into account all the variants, including payment methods, special offers, discounts and so forth, we see that there are about 4,000 different tariffs, and the evidence clearly suggests that that is all very confusing. I have recently seen evidence to suggest that a quarter of all those who switch, and up to half of all those who switch as a result of direct selling on the doorstep, switch to a worse tariff. That is clear evidence that there is a lot of confusion out there. Until recently, a customer on a social tariff had no guarantee that they were on the cheapest tariff. Thankfully, Ofgem has taken some action to try to put that right, but it clearly illustrates that there is widespread confusion with regard to this plethora of different tariffs. That is wrong. We need simple measures, with energy companies putting on bills information about the cheapest tariff, given certain preconditions. Payment by direct debit and online access are two of the preconditions. However, that is a bare minimum—it does not prevent energy companies from adding other tariffs, including social tariffs, to try to
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ensure that they meet their social responsibility to help the customer to achieve the cheapest tariff possible.

The direction of travel is in our favour. Ofgem is considering the issue. It has suggested, for example, that energy companies might be required each year to display on their bills the customer’s usage against an average group of tariffs and declare whether the customer has paid a premium. That is a step in the right direction, and it is to be welcomed. However, an annual statement is not good enough. This prompt—this comparison with cheapest tariffs—should be issued when consumers get their bills through the door, because that is when they are most aware of their tariff.

We all accept that energy companies need to make a profit—there is big investment to be made in the infrastructure and so forth—but at the same time they owe a social responsibility to their customers, and that needs to be met. The industry has made some helpful moves. Energy companies have introduced social tariffs and funded the Home Heat helpline, and the Energy Retail Association and Citizens Advice have been helping customers, but they could take this one further, very simple step to help customers to achieve the cheapest tariff. That would create a lot of good will for them and do a lot to help consumers with their bills at this time of very high energy and food prices. Ofgem is heading in the right direction, and the industry is trying to make moves to help consumers, but we need a clear message from Parliament on this issue. I therefore commend the Bill to the House.

Question put and agreed to.


That Mr. John Baron, Mr. Lee Scott, Mr. Frank Field, Mr. Peter Kilfoyle, Nick Harvey, Mr. Peter Ainsworth, Mike Penning, Dr. Kim Howells, Mr. Peter Bone, Dr. Ian Gibson, Mr. David Laws and Dr. Richard Taylor present the Bill.

Mr. John Baron accordingly presented the Bill.

Bill read the First time; to be read a Second time on Friday 16 October and to be printed (Bill 87) .

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Ways and Means

Budget Resolutions and Economic Situation

Amendment of the law

Debate resumed (Order, 22 April).

Question again proposed,

5.4 pm

The Secretary of State for Innovation, Universities and Skills (Mr. John Denham): As Britain recovers from the impact of the world recession, it will be British business and the skills of the British people that will ensure that the upturn comes as quickly, as strongly and as sustainably as possible. Today’s Budget debate is about the best way of supporting British business and the British people this year, next year and in the years to come. It is about whether we invest for growth or undermine recovery with ill-conceived cuts. It is about whether we identify the parts of the economy in which we have real strengths and the potential to have global leadership, or refuse to support them effectively.

The debate is also another opportunity to set out the gulf between the main parties on how we respond to the global downturn. I believe that that gulf has become increasingly clear over the past few days. There are three defining issues for today’s debate, on which the Opposition first show that they do not understand the problem, secondly propose policies that would make things worse and thirdly do not understand what needs to be done. That is what this debate today is about.

Mr. Desmond Swayne (New Forest, West) (Con): Is that really what this day’s debate is about—the Opposition? Is it not extraordinary that the Government begin with an attack on the Opposition rather than with an exposition of their own case?

Mr. Denham: There will be a good deal more of that before I have finished, but I will of course set out precisely what the Government propose to do for business and the British people to develop their skills and bring about recovery. However, this is a Budget debate, and it is important to understand that there are choices to be made between the approach that is being taken by this Labour Government and the approach that is being put forward by the Opposition. I make no apology for setting out the key issues on which that choice has to be made.

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The Opposition believe that the challenges facing Britain are more or less a uniquely British problem, created here and with answers that lie solely in Britain. They are wrong. What started with the fall-out from sub-prime mortgage lending in the US has spread quickly around the world, turning into the credit crunch, which in turn has hit businesses in all parts of the economy in every part of the world. What this country is experiencing is the first global recession since the end of the second world war, and what is happening to us is, in essence, happening to all comparable countries.

Mr. Ben Wallace (Lancaster and Wyre) (Con): Given that the Secretary of State mentions the world “comparable”, if things are happening comparably to all of us in this environment, why are we worse off than comparable economic powers in the G20?

Mr. Denham: The interesting point is that the fall in UK gross domestic product in the last quarter of 2008 was the same as the fall in GDP in the eurozone as a whole and in the United States of America. In Japan, GDP fell by 3.2 per cent. in the year to February 2009, and Japanese exports fell by 45 per cent. So in fact, I am right to say that the experience of similar economies is broadly comparable to our own. It is because our challenges are broadly similar to those of other countries that our response needs to be broadly similar. That means maintaining investment in the economy and avoiding cuts in public spending in the middle of the recession.

Mr. Bernard Jenkin (North Essex) (Con): I apologise to the Secretary of State for missing the opening moments of his speech—it is ironic that a ten-minute Bill does not always have to last 10 minutes.

Can the Secretary of State explain why this global downturn has occurred, whether it started here and what has caused it if not policy mistakes by this Government and a number of other Governments around the world?

Mr. Denham: I have to say that the ten-minute Bill that preceded the debate was one of the best timed that I have experienced. I think that the hon. Member for Billericay (Mr. Baron) ended some three seconds short, so that is a poor excuse for turning up late for the beginning of the debate, when I explained how what happened in the United States of America in the sub-prime market and its link to the various financial instruments around the world have affected the real economy. The key point is that many countries are affected and we have to examine the responses that are being made.

The response around the world, which I believe to be right, is that Governments should maintain investment in the economy at this time and that they should avoid cuts in public expenditure in the middle of the recession. The G20 summit was about international action to get the global economy back on track—countries around the world introducing a huge fiscal stimulus and more resources for the International Monetary Fund and for developing countries.

Mr. Graham Stuart (Beverley and Holderness) (Con): The Secretary of State said that he does not believe that public expenditure should be constrained in the recession, yet the Budget introduced a cut of nearly £1 billion in education and more than £2 billion in health. I wonder whether he can square those two points.

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Mr. Denham: I said that public expenditure should not be cut in the recession—that is the Conservative party’s policy. The Budget sets out clearly that public expenditure will continue to grow—certainly not as rapidly as in the past 10 years, but it will continue to grow. That is a different approach from the Conservative party’s insistence that we should cut public spending now.

The main Opposition party makes its second defining mistake because it does not properly understand the nature of the problems that face this country. It perceives our problems as uniquely British and therefore turns its back on important international action. The Conservative party says that all that matters is action now, here, to reduce borrowing and cut spending. For that reason, the Conservatives proposed a series of policies which, individually and together, would make things worse.

Stewart Hosie (Dundee, East) (SNP): The Secretary of State suggests that one should not cut in the teeth of recession. That is sensible, and it is therefore disappointing that the Government are doing that. Even if we assume that their figures are right, if we find that, towards the end of the year, we have not recovered and the independent forecasters who forecast negative growth next year are correct, will we look forward to a pre-Budget report in which the Government reverse the damaging cuts planned for next year?

Mr. Denham: The Government are setting out plans to maintain public spending on front-line services to grow them in future. I am not about to set out a different Budget from that which my right hon. Friend the Chancellor introduced last week. That Budget defined the key choice that voters in this country must make between a strategy of maintaining investment and growing our way out of recession and Conservative party policies, which would make things worse.

Tony Baldry (Banbury) (Con) rose—

Mr. Denham: In a moment, I will set out exactly why those policies would make things worse, but first I shall give way to the hon. Gentleman.

Tony Baldry: Will the Secretary of State confirm that, from 2011, according to the Government’s figures, Government spending will grow at 0.7 per cent. a year? Will he also confirm that, in Margaret Thatcher’s toughest year when Prime Minister, public spending grew by more than 2 per cent.? This Government will have to cut harder and faster than ever happened under Margaret Thatcher because of the huge public debt that they have incurred.

Mr. Denham: That is an extraordinary intervention for the hon. Gentleman to make, when his party demands massive, real cuts this financial year. The Budget sets out real growth in public expenditure and the efficiency savings that will be necessary to ensure that we maintain spending on front-line services. It is interesting that the hon. Gentleman asks a question that is designed to divert attention from the policies, with which I am sure he does not agree, of Conservative Front Benchers to do enormous damage to our economy through cuts.

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