Central Heating Installations: Consumer Protection

Wednesday 10th October 2018 Westminster Hall

10:57

[Jamie Stone (Caithness, Sutherland and Easter Ross) (LD)]

I beg to move,

That this House has considered consumer protections for new central heating installations.

As ever, it is a pleasure to serve under your chairmanship, Mr Gapes. I am extremely glad to have discovered just seconds ago that I do not need to sum up at the end of the debate. Being relatively new to this place, I suddenly had kittens at the thought that I might have completely misunderstood parliamentary procedure, but I think I may have got it right.

The very first time that what I regard as a fairly serious issue crossed my radar was shortly after my mother died. I may be called sentimental by many but I decided that it would be too sad for my mother’s old telephone number, which she had all her life, to go to some anonymous BT file. For that reason, three years ago I thought that I would ask for my telephone number to be deleted, so I could take on my mother’s old telephone number. That was when the trouble started. Why do the calls always seem to come at 5 o’clock in the afternoon? That is my impression, at least. They go, “Hello. If you’re a pensioner or on benefits, you will be very interested to know of a central heating scheme for which you could be eligible.” If I had a penny for each of those telephone calls, I would have a few quid by now.

There is nothing inherently wrong at all with the idea of people in need receiving new, efficient central heating systems, paid for by either a Government grant or a levy scheme from a large utility company. The good intention behind the scheme cannot be faulted; after all, it is simply about making those in need warm and able to afford the cost of being warm. However, the trouble comes because the recipient of the new central heating system has not paid for it directly themselves.

The Consumer Contracts (Information, Cancellation and Additional Charges) Regulations 2013 do not apply. Those regulations contain detailed and pretty stringent requirements of businesses that sell goods and services off-premises—that is, door to door. They require consumers to be given detailed paperwork, and give them the right to a cooling-off period. In fairness, other consumer laws apply, but I must tell Members, as an MP and a citizen, that making them actually bite can prove a real challenge. I do not want to go into the detail of that in the short time I have, but I am pretty sure that every Member will have some experience of that issue.

I return to the issue of people being called and asked whether they would like a new boiler and heating system. Sadly, all too often we hear stories about cowboy installations. In some cases the heating system is defective, and getting it put right can prove nearly impossible for the household involved.

[Patricia Gibson (North Ayrshire and Arran) (SNP)]

Related to the matters the hon. Gentleman raises, many people across the UK—certainly in Scotland—fell victim to the Home Energy and Lifestyle Management Systems green energy scandal. Customers have been left feeling very let down and are pleading with the UK Government to intervene directly to assist them out of the mess they found themselves in after that company cold-called them, went into liquidation and left them high and dry.

[Jamie Stone]

The hon. Lady makes a fair point. As a fellow Scot, I come across that kind of case all too frequently, and it is a nasty example of what I am on about. I will return to the sort of regulatory scheme we might use to try to tackle it. Of course, at that point the person in trouble often turns to their MP for help, so I am pleased to have secured the debate.

I have no doubt that Her Majesty’s Government and the Minister wish to do everything they can to help sort out this issue, so I wonder whether I may make a few suggestions. The first is that there ought to be a truly independent body—it could be administered by local authorities—to assess the need for a particular household to be considered for a new central heating system.

I suggest that would achieve two things. First, it would nip in the bud the rather extraordinary situation, which I am sure my Scottish colleague will recognise, whereby virtually new boilers and heating systems are unnecessarily removed and replaced when there is no need for that to happen—the system may just have needed some mechanical tweaking to make it work better. Sadly, that happens, and it is a waste of money. Secondly, I hope that it would tackle thorny situations where there is a really old heating system—30 or 40 years old, or more—that is highly inefficient but, for reasons I know not, contractors hesitate to replace it. There is something wrong with the system in that respect. There is evidence of that, and I suggest that the Department should look at that aspect of the issue.

My second suggestion is that there should be an accreditation system for businesses that install such equipment. After all, in the building world, we have building control regulations. We all know them—they run in parallel with planning conditions. Those regulations cover all manner of issues about the design and construction of a new build—everything from the steepness of a staircase to the load-bearing potential of roof trusses. The fact is that those rules work well—I think I can say that is true throughout the UK—which is why we do not have houses falling on our heads. People may get a bit irritated when building control people come out and say, “No, you’ve not done it right,” but the regulations are there for the best of reasons. It seems to me that a similar regime could be applied to heating systems purchased through grants and levies. The bottom line is that if a heating system is installed wrongly, it can, in the wrong circumstances, be dangerous and may cause a household fire.

My third and final suggestion is that there should be a cooling-off period after a householder agrees to a system being installed during which they are allowed to change their mind. Indeed, my first suggestion could kick in at that point. It should be the law that, when a householder says to the person on the other end of the telephone, “Yes, I like the sound of a new central heating system,” it must be pointed out to them that that system must be run past the independent body I mentioned before they proceed. The independent body may agree with the householder and say, “Yes, your system could do with upgrading, and this suitably accredited firm might be just the people to do it for you.”

[Patricia Gibson]

I thank the hon. Gentleman for pointing out how we could improve the situation and prevent the unfortunate experiences of our constituents, but I hope the Minister agrees that we must also try to address some of the huge injustices that my constituents and people much further afield have experienced. We are in a situation where consumers cannot sell their houses. Under the HELMS deals, consumers had solar panels fitted in good faith but found they were not in the feed-in tariff and could not register for it. They were mis-sold credit deals, they pay more for their electricity, and they are tied into payment contracts with energy suppliers for two decades. I wonder what the hon. Gentleman thinks about fixing those injustices before—

[Mike Gapes (in the Chair)]

Order. I remind the hon. Lady that interventions are meant to be brief.

[Patricia Gibson]

Indeed, but I just wondered—

[Mike Gapes (in the Chair)]

Yes, they will be brief—thank you. I call Jamie Stone.

[Jamie Stone]

It is a pleasure to take an intervention of that quality. The hon. Lady contributes wisely to the point I am trying to make. She is exactly right that the sale of a house can be affected.

I said that a householder, once they have said, “Yes, we like the idea of a new central heating system,” should have to go to an independent person, who should ask, “Do you or don’t you actually need it?” However, I would not want that rule to be absolute. For instance, social workers and, to an extent, NHS employees may have a good idea of which households might benefit from a Government grant or levy scheme heating system, but the householder may not feel inclined, for whatever reason, to reply to the telephone call or make an independent application. Sometimes there has to be a push from a different angle to ensure that someone gets the best deal.

Let me conclude where I started. A lot of people find the telephone calls I mentioned intrusive, but for some they are quite frightening, which many people do not need. In the case of my late mother’s telephone number, my wife is sick and tired of telling firms that my mother is no longer with us. Curiously, as an anecdote, one of our neighbours—a doctor’s widow, who is no fool whatsoever—finds that when she mentions that she is over 80 the conversation from the other end stops immediately. I have no idea why that is, and I will forgive the Minister if she does not know the reason for that curious quirk of fact.

I repeat—I give the Government credit where it is due—that the good and kindly intention of giving someone an affordable, warm home absolutely should not be underestimated. There are various marks of a civilised society, and I believe that is surely one of them. As I represent one of the coldest parts—nay, the coldest part—of the British Isles at Altnaharra, I do rather know what I am talking about on keeping houses warm.

It is a shame if a number of loopholes lead to unsatisfactory service delivery, and I suggest to the Minister that that is what we see. Of course, there are good contractors who are proud of their standard of their work, and it would be a real shame, would it not, if their reputation were tarnished by the odd rotten apple? I suggest that, sadly, that is rather the case. It is simply not fair on the firms that are trying to do their best, or on the Government, who have the best of intentions in trying to look after old people and make their lives of the highest possible quality.

Whether through a Government grant or a levy scheme, money can be used to the good of people. Getting it right and targeting the money with absolute accuracy is crucial. The electorate are not stupid. They like to see the public pound targeted for maximum effect, and they expect nothing less of good government.

11:11

[The Minister for Energy and Clean Growth (Claire Perry)]

It is a pleasure, as always, to serve under your chairmanship, Mr Gapes. I congratulate the hon. Member for Caithness, Sutherland and Easter Ross (Jamie Stone) on securing the debate and on approaching it in a collegial way. He asked important questions on behalf of his belated mother—I extend my condolences to him for his loss—and raised important questions that cross the provision of better forms of central heating as well as, more broadly, telephone mis-selling and consumer rights. I feel qualified to answer some of his points but, in my summation, I will say how I will help to perhaps raise all of our understanding.

As the hon. Gentleman will know, the Government are committed to making energy bills more affordable, particularly for lower income or more vulnerable households. Of course, that involves working with industry in particular to improve both the targeting of schemes such as the one to which he referred and the process of delivering improvements in a way that benefits consumers. I will take a moment to talk about current protections and then address some of the hon. Gentleman’s excellent suggestions.

Reasonable levels of protection are in place for boiler installations. Indeed, all installations should be reported to a local authority building control, which is responsible for ensuring that such work meets building codes and regulations, not least because of safety questions. All installers of gas boilers must be on the Gas Safe Register—and, of course, they can be struck off. We have the highest energy efficiency standards for gas boiler installations of any European country, and we continue to raise those standards to ensure that consumers get the maximum heating efficiency for the minimum cost and carbon dioxide emissions. As with any other consumer contract, if consumers are dissatisfied with how the work has been delivered, they can appeal to their local citizens advice bureau or trading standards. In Scotland, people can appeal to Home Energy Scotland, which can provide free and impartial energy advice.

On the hon. Gentleman’s question about cooling-off periods, the installation of a boiler, as with any consumer contract, is subject to a cooling-off period, which I believe is 14 days. I will put that in a letter to him, which I will refer to later in my remarks.

As the hon. Gentleman noted, we also have the energy company obligation scheme to help those who are struggling with bills. Historically, that scheme has been split between helping those struggling with bill payments and reducing carbon emissions. I have decided to put as close as possible to 100% of that scheme into solving the challenge of fuel poverty, as part of the Government’s manifesto commitment to reduce the level of fuel poverty by 2035. The scheme is worth about £640 million a year—a large sum of money—and 10% of the households in the hon. Gentleman’s constituency have received measures under it, which might include electric storage heaters and oil boilers. I am sure that, like in my constituency, many of his constituents will live off the gas grid and be reliant on stand-alone heating.

The hon. Gentleman asked an important question about how we can ensure that these things are needed. I live in an off-gas-grid area in the middle of my constituency, and most weeks I go home to a flyer through my door suggesting that I apply for a new oil boiler. I do not feel that I am the target audience for these measures, and I have raised repeatedly with my team how we improve the targeting of this valuable sum of money towards those who need it most.

I hope the hon. Gentleman will be pleased to know that, in the latest iteration of ECO, we have increased the level of money that a local authority can spend with its discretion to 25%. We have also increased the level of money spent in rural areas such as those we represent to 15%, so there is now more of a local targeting element. On the hon. Gentleman’s suggestion that local authorities should know who has been approached, I am the least likely person to want to burden our hard-pressed local officials with more reporting requirements on behalf of central Government, but the local relevance of measures, as he said, is incredibly important.

The hon. Gentleman mentioned standards. Any ECO installation must meet building regulations and British installation standards, and insulation measures must have an appropriate lifetime guarantee—even tighter measures than for general installations

The hon. Member for North Ayrshire and Arran (Patricia Gibson) rightly raised the question of renewable heat contracts sold to constituents that had indirect payments associated with them. In June, I introduced an assignment of rights so that people trapped in such contracts can assign them to another party, which should enable them to free up their homes for sale. One of my action points from the debate is to write to her with the details of that scheme to share with her constituents.

[Patricia Gibson]

I thank the Minister for promising to write to me on that, because it is important to many constituents. Given that we know that HELMS exploited constituents by mis-selling a Government-backed deal and that the Government backed the company, will the UK Government undertake even to consider a review of green deal loans proposed by that company, given the high volume of loans that have a payback period exceeding 20 years?

[Claire Perry]

The hon. Lady is not alone in raising the challenges of mis-selling under the green deal, and I have asked my officials to look at that. The green deal—I was on its Bill Committee—was designed to unlock the issue of persuading people to improve the energy efficiency measures of their homes. Currently, all contracts are covered by existing consumer protection, but as a second action point I undertake to go away and review this specific company and write to her with the state of progress on those conversations.

I mentioned the assignment of rights, and both hon. Members have raised the challenge of whether there should not be more trust in the system. We have a question of mis-selling, which I will address in my final remarks, but should households not be able to trust the installer phoning them up to offer what could be a valuable addition to their homes? We conducted a review called “Each Home Counts”, and one of its key recommendations was for an independent, all-encompassing mark of quality for both installation and customer service that consumers can rely on and trust. We will launch a more robust, Government-endorsed quality scheme through TrustMark.

[Jamie Stone]

This is a side issue to what I said earlier. Given what the Minister just said, there may be some evidence that wood pellet boilers are being proposed for households—particularly for the elderly—where that may not be the most suitable form of heating. I have heard stories of pensioners going out in the snow to shovel wood pellets.

[Claire Perry]

The hon. Gentleman raises an important question, and because of the changes to the renewable heat incentive, which were a driver for many domestic wood pellet installations, such things will no longer be supported. I agree, however, that we had a shortage of domestic pellets for much of the winter, and in my region we have a shortage of engineers to service those boilers. I do not suggest that people should rip those boilers out, because they play a valuable part and are supported historically under the RHI, but in future I would like homes in rural areas that are off the gas grid to be supported with things such as heat pumps and other technologies that are far less complicated and costly. That is part of the change that we are hoping to make to the RHI scheme and the energy compliance obligation going forward.

Let me return to the question of trust. We plan for all Government schemes such as the ECO to require installers to deliver those TrustMark standards. That will help drive out rogue traders—the hon. Gentleman is right to say that some traders claim falsely to be part of the Government’s scheme, when they are no such thing—and we will strongly support such measures, and encourage consumers to use only reputable traders. Consumers should be certain when they see a brand that they are dealing with a company that has the right technical competencies and is committed to customer service and the customer for the long term. The Consumer Protection Partnership has identified energy efficiency measures as a priority area, and it will be taking forward work to see how consumer detriment can be reduced in that area.

The hon. Gentleman raised other important points, which I do not feel qualified to answer, regarding the whole challenge of consumer mis-selling over the phone—that has now switched to mobile phones, since many of us decided never to answer our landlines to an unidentified number. He raised the question of rights for consumers under existing contract law, and my fellow Ministers have done good work in this area. I am afraid I am not prepared to give the hon. Gentleman the details, but I will write to him as a third action point to set those out, so he can be sure that the question of telephone mis-selling and consumer protection is being addressed.

I hope that that partially answers some of the hon. Gentleman’s excellent suggestions about independent bodies, local involvement, an accreditation system and cooling-off points. I have set out a number of actions for my team to follow up, and I thank the hon. Gentleman and the hon. Member for North Ayrshire and Arran for raising such important points on behalf of their constituents.

Question put and agreed to.

11:22

Sitting suspended.