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Energy Prices and Profits

Part of Opposition Day — [6th Allotted Day] — Living Standards – in the House of Commons at 6:05 pm on 4th September 2013.

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Photo of Christopher Pincher Christopher Pincher Conservative, Tamworth 6:05 pm, 4th September 2013

At risk of continuing the Select Committee love-in, may I also say that it is a great pleasure to follow Albert Owen—a fellow member of the Energy and Climate Change Committee? I am pleased to speak in this Opposition debate, which is important to our constituents.

Let me gently chide Caroline Flint on her motion and her speech for revelling in past glories, without recognising the last Labour Government’s errors of omission and commission with respect to energy policy. If we look at energy policy in the long view, its impact on energy prices and the effect of those prices on fuel poverty, we will remember that between 2004 and 2009, fuel poverty effectively trebled as a direct consequence of the energy price increases—largely gas prices, which went up by 42% in the Blair years between 2003 and 2007, and by a whopping 74% by 2009. The Leader of the Opposition, who tabled today’s motion, should be somewhat embarrassed to remember that for some of that time he was Secretary of State for Energy and Climate Change, so that happened partly on his watch, as he watched and saw 2.8 million more people being trapped by the scourge of fuel poverty.

In the first decade of this century, Labour, with laudable intent, spent £25 billion on measures to alleviate fuel poverty, but those measures were swamped by the increase in energy prices—not a description that I chose to use, but one chosen by the Library. Labour’s solution, which was to spend more and more money to try to alleviate fuel poverty was like sticking a plaster on a gaping wound, or like giving Angiers junior aspirin to a pneumonia patient: it dealt with the symptoms, not with the problem itself.

In line with a feeling of consensus, we certainly need to find some new solutions. There are more, but I shall mention four of them, some already mentioned today. The first is to deal with the complexity of energy bills; we all agree that they are far too complex. Many consumers—possibly the poorest and the least educated —do not feel confident about switching their bills. About 75% of consumers have not switched their energy provider in the past two years, while 55% have not even looked to try. We certainly need to make the bills much simpler, so that consumers become more confident about switching. Tariffs, too, need to be made simpler, and we need to ensure that people are put on the lowest tariff that is best for them. The Energy Bill commits to that, and the Prime Minister is committed to it. I am sure that it will happen.

The hon. Member for Ynys Môn—I would like to call him my hon. Friend—mentioned the difficulties energy companies seem to have in communicating with their consumers. That is true. I am a consumer. Nine months ago, I inherited a supply from RWE npower, but I have still not received a bill. The company has been unable to put me on a direct debit, and it does not call back when it says it will, leading me to wonder what confidence I can have in being able to deal sensibly with that company. We need Ofgem to make sure that these companies deal clearly, transparently and effectively with their customers.