Household Energy Bills

Energy and Climate Change – in the House of Commons at 9:30 am on 19th March 2015.

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Photo of Wayne David Wayne David Labour, Caerphilly 9:30 am, 19th March 2015

What steps he is taking to help households with their energy bills.

Photo of Susan Elan Jones Susan Elan Jones Opposition Whip (Commons)

What steps he is taking to help households with their energy bills.

Photo of Chris Evans Chris Evans Labour, Islwyn

What steps he is taking to help households with their energy bills.

Photo of Amber Rudd Amber Rudd The Parliamentary Under-Secretary of State for Energy and Climate Change

Energy bills are a significant and important part of people’s household budgets. The Government have delivered, on average, a £50 reduction in energy bills, boosted competition in the energy market and ensured that fairer tariffs are in place. Last year alone, 3.1 million people switched energy supplier, and we are helping more consumers to save up to £200 or more through our Power to Switch campaign.

Photo of Wayne David Wayne David Labour, Caerphilly

Wholesale gas and electricity prices have fallen by some 20% over the past 12 months, yet household bills have gone down by only 5%. Is that fair, and what is the Minister going to do about it?

Photo of Amber Rudd Amber Rudd The Parliamentary Under-Secretary of State for Energy and Climate Change

We are taking action on that. My right hon. Friend the Chancellor led on that by calling in the big six to speak to them about it, and that was followed up by my right hon. Friend the Secretary of State. We have seen reductions. All I can say is thank goodness we did not have the freeze that Labour proposed in September 2013, because we would then have seen no reduction at all. We do not take anything for granted, which is why we are supporting the CMA review into the market. We eagerly await its results at the end of the year, when we can take action.

Photo of Susan Elan Jones Susan Elan Jones Opposition Whip (Commons)

The Ministers words will ring very hollow indeed in many of our rural communities, where people are off-grid and rely on domestic oil for heating. I ask the Minister not to quote what the price happens to be this week, because we know that, like gravity, domestic oil prices go up and down. Will she tell us why the Government have not listened to MPs from across the parties who have asked for domestic oil to be put under the regulator Ofgem?

Photo of Amber Rudd Amber Rudd The Parliamentary Under-Secretary of State for Energy and Climate Change

We have put in place a fuel poverty strategy, which will address some of the issues the hon. Lady raises. We are liaising with Ofgem and are encouraged by the early results from the CMA, and of course we will be taking them up further when they come through at the end of the year.

Photo of Chris Evans Chris Evans Labour, Islwyn

Despite the rosy picture that the Chancellor wanted to portray yesterday, fuel poverty in Wales has gone up by 18% since 2011, and 90,000 people with children cannot afford their energy bills. When are the Government going to take real, tangible action to fight rip-off bills from these energy companies?

Photo of Amber Rudd Amber Rudd The Parliamentary Under-Secretary of State for Energy and Climate Change

The hon. Gentleman may know that the Big Energy Saving Network is active in Wales. That is an initiative from this Department that instructs and funds third parties to go out and help people to switch and to access the warm homes discount. Yesterday in the Budget, my right hon. Friend the Chancellor announced further funding for the Big Energy Saving Network, and that will go exactly to the cause that the hon. Gentleman raises, which we care about as well.

Photo of David Heath David Heath Liberal Democrat, Somerton and Frome

Following on from the question from Susan Elan Jones, many, many people in rural areas like mine are dependent on fuel oil or liquid petroleum gas and have seen their costs go up inexorably over recent years. Even in an unregulated market, is there any way in which the Minister can ensure that the prices now fall commensurate with the fall in oil and gas prices, and do so promptly?

Photo of Amber Rudd Amber Rudd The Parliamentary Under-Secretary of State for Energy and Climate Change

As the hon. Gentleman observes, the price has been falling, and we will keep a careful eye on it to make sure that it continues to fall. I would hope that it should fall at a greater rate than the major energy companies’ bills, because gas prices have been falling at a greater rate.

Photo of Caroline Flint Caroline Flint Shadow Secretary of State for Energy and Climate Change

Recently Dr Lee, a respected member of the Energy and Climate Change Committee, admitted that the Conservative party had no clear energy policy and had been relegated to “second fiddle”. Helpfully, he added:

“If I’m honest, I don’t think we’ve done particularly well.”

If Government Members do not have any confidence in their own party’s energy policy, why should the British people?

Photo of Amber Rudd Amber Rudd The Parliamentary Under-Secretary of State for Energy and Climate Change

I will be answering a question from my hon. Friend Dr Lee later, and I look forward to that opportunity. I think that our energy policy is absolutely clear and is delivering what we set out to do. To be honest, the lack of clarity and the chaos is only on the Opposition Benches, because we remain completely confused about the Opposition’s policy towards Ofgem, which they claim to want to amend, on the one hand, and abolish, on the other. As for the price freeze, I think I will hear about that later from my hon. Friend.

Photo of Caroline Flint Caroline Flint Shadow Secretary of State for Energy and Climate Change

I am afraid that there will be nowhere to hide in the forthcoming general election as regards the coalition parties and their energy policies. The facts speak for themselves: energy bills £300 higher; three out of four households being overcharged by their energy supplier; the number of families with children who cannot afford to heat their homes at the highest-ever level; and, as we have heard today—it has been reconfirmed—a Government who, for five years, have just told people to shop around. Does not this show that the only way to help households with their energy bills is to elect a Labour Government to freeze energy prices until 2017 while we reform the market and give the regulator the power to cut bills in time for Christmas?

Photo of Amber Rudd Amber Rudd The Parliamentary Under-Secretary of State for Energy and Climate Change

That is further chaos from Labour about a cap or a freeze—we have no idea which they would do. Let me point out to the right hon. Lady that during 2013 the UK had the lowest household gas prices and the fifth lowest household electricity prices in the EU 15. In no way are we complacent about what has been achieved in helping people; that is why we back the CMA’s reforms. It is very disappointing that she does not back the CMA’s approach, which will give us an independent review that we look forward to enacting at the end of the year.