Domestic Premises (Energy Performance) Bill [HL]

(Limited Text - Ministerial Extracts only)

2nd reading & 2nd reading (Hansard): House of Lords & 2nd reading (Hansard)
Friday 7th February 2020 Lords Chamber

[The Parliamentary Under-Secretary of State, Department for Business, Energy and Industrial Strategy and Northern Ireland Office (Lord Duncan of Springbank) (Con)]

My Lords, this has been an interesting and important discussion on a Bill that addresses an issue which I believe we all care very much about. As we look at the challenges facing the country in ensuring that all are able to live in a warm home, there is no doubt in my mind right now that that is a simple statement of ambition for everyone here.

The Government remain committed to delivering on a heat policy road map, and they will do so very soon indeed. It will look at how to both reduce emissions on buildings and address energy efficiency and will come as part of a series of announcements that we will make as we approach COP 26 in Glasgow in November. That heat policy road map is imminent. However, it cannot come alone; it must come alongside a fuel poverty strategy for England—I cannot on this occasion speak for Scotland. Again, that strategy will come very soon. These two combined policies will set out the series of steps which will be taken to bring us toward taking the necessary step to ensure that we have eliminated fuel poverty and addressed the energy efficiency of buildings in good time on our approach to our ambitious net zero target by 2050.

The noble Lord, Lord McNicol, asked when the White Paper is coming. It will necessarily come first, setting each of these policies and a wider range of policies into a broader context. Again, that is also part of our ambitious complete statement ahead of the Glasgow climate change conference.

On the question of ongoing investment in addressing the quality and durability of homes, we continue to invest some £2.5 billion in capital funding to improve the homes of those on lower incomes, and we are seeking to improve the warm home discount and energy company obligation. Each of these will be necessary.

A great deal has changed since the earlier incarnation of the Bill was introduced in the other place, not least that there has been an election, which is one of the reasons why that Bill did not make progress. In that election, the party of government, to which I belong, made a number of serious commitments in its manifesto, and it is worth while rehearsing what they are. There will be £6.3 billion-worth of upgrade for those in fuel-poor homes, particularly in social housing. We will consult on raising minimum energy performance standards in private rentals—again, as a number of noble Lords mentioned today, private rentals are perhaps the most difficult to reach of all properties, since they are in the hands of a large number of individuals. We will consult on setting requirements for lenders to improve the energy performance, which, again, should help us move in the right direction. Finally, we will consult on phasing out the installation of fossil fuel heating systems in off-gas grid properties—again, trying to get to that hard-to-reach final point in moving this forward.

We are putting forward a number of other policies, some of which touch on issues raised by noble Lords today. On the question of insulation, raised by the noble Lord, Lord Redesdale, he is quite right. You can have the best insulation, badly installed, and you achieve literally nothing. The problem with that is that if your kitemarked process does not recognise the installation, you could theoretically have a high quality and yet a low reality, and you might never know that, because there is no way to monitor it traditionally inside your own home. Therefore, we are instituting a new trust mark scheme, which should allow us to examine things such as cavity wall insulation to ensure that it is up to standard regarding not just the materials but the installation itself. That should go some of the way forward. We are also putting £5 million into the green home finance innovation to look at other ways in which we can address some of the issues inside homes, and £10 million to examine how best to retrofit.

A number of noble Lords, including the noble Earl, Lord Errol, questioned how we are able to look at some houses which are listed beyond the ability to address them. To be frank, it is a hornets’ nest to try to look at the whole listing process, but that will need to be done. We are sitting in a Chamber that is surrounded by glass held in by pieces of lead. As this building goes through its retrofit, we have to ask ourselves how it shall achieve the highest possible standard, and what it can expect to achieve in that regard.

The noble Lord, Lord Teverson, asked why the number of people who seem to be stuck in fuel poverty does not seem to change year on year. He is right to ask that, and the answer is a more straightforward one, as it is a relative metric. It is always looking at the bottom 10% to 12%, so we will always get a similar sort of figure. However, because what we are measuring inside that will change but the numbers themselves may not, to measure progress within it we need to look at the fuel poverty gap, which is the difference in bills between fuel-poor and not fuel-poor households. The fuel poverty gap fell from £873 million in 2010 to £812 million in 2017—the most recent statistics that we have. I do not think that is enough, if I am being honest, but it is a move in the right direction. The noble Lord, Lord Teverson, also asked about the renewable heat incentive. My right honourable friend the Prime Minister has committed to a replacement for that, but I do not yet know what that replacement will be, so I cannot give him any more detail on that.

The noble Lord, Lord Deben, made a number of serious points. His chairmanship of the Committee on Climate Change is welcome and his contribution is welcome in that regard. Our future home standards will be introduced by 2025. I know that he will quickly say that that is too late, and I understand why he would, but it will require new-build homes to be future-proofed, with low-carbon heating and world-leading levels of energy efficiency. As it happens, we are consulting on it right now, and consultation on that particular proposal closes today, so I fear those who have not yet put their thoughts on paper may be a little too late.

[Lord Deben]

Will my noble friend give way on that point? Can he assure me that in 2025, the new standards will come into operation on any house that is under construction, and not wait for people to have fulfilled their planning period; otherwise, it will not be 2025—as history tells us, it will be 2029?

[Lord Duncan of Springbank]

I will give that commitment; I think I can do that. This may not be in the consultation, but I think that would make perfect sense. We need dates to be meaningful, and 2025 is the meaningful date we are talking about here. If a piece of paper whistles towards me from the Box, noble Lords will realise that I have gone beyond my brief, but I think that at this point that commitment is something I can make—I hope. Yes, I have reassurance from over my shoulder.

The noble Lord, Lord Whitty, asked about the radio programme he heard this morning and what tax issue will come forward. I suspect that it is true to say that all of this area is being examined. The Treasury works in mysterious ways: I cannot tell noble Lords exactly what it is thinking about at this moment, but I am sure it is thinking very big thoughts. When it tells us what they are, I shall be very interested to hear them, much the same as the noble Lord.

What I have to come round to, and have been skirting around just now, is that although the Bill itself is welcome in so far as it facilitates this discussion and our debate today, we cannot support it. I appreciate that a number of noble Lords will be disappointed in that regard, but let me explain some of the reasons why we cannot do that today.

The first is that we have strategies coming which will examine this. I thought that was a piece of paper whistling toward me—good, it was not. I am sorry about that; I am distracting myself. The policies that we will be putting out in a matter of a few months will set the strategic direction and set in place within a road map how we will achieve it. The Bill before us would cut across that and reduce our flexibility when that comes forward.

The other aspect of the Bill is that it gives us no new powers or levers. It does not actually help us achieve the ends; it would simply set the framework within which we are to achieve them. Those dates will be contained within the strategies I mentioned. It will be important to ensure that the strategies have clear dates, and we have a road map with commitments which fit into a legal framework to ensure the certainty which underpins the purpose behind the Bill: to allow the building sector to understand what it is up against, what it has to commit to, and, frankly, what it should be exceeding. These should be setting minimum standards, there should not be any limit on their ambitions to move beyond that point.

I do not doubt that the noble Lord will be disappointed to hear that we do not support the Bill, but I can give assurances that in the development of the strategies to come, I would welcome his involvement and that of all Members of the House who have taken an interest in the Bill today. I would also welcome the involvement of Mr Bailey; I was disappointed to hear that he was ill, but would welcome his involvement in this process as the strategies become more robust. I think elements of the Bill will find a new home in the strategy as it manifests itself as a more solid approach.

I appreciate that that is not the outcome many here would have wished for, but I hope that noble Lords will understand why I am saying that. We are in no way seeking to be less than absolutely ambitious in this area, and we will seek to work with all to ensure that our strategy delivers, as this Bill itself would have delivered.