Energy Market Reform

Debate between John Hayes and Neil Parish

Wednesday 24th October 2012 Commons Chamber

[The Minister of State, Department of Energy and Climate Change (Mr John Hayes)]

A long, long time ago, cavemen discovered that flint made fire, but the opening speech by the right hon. Member for Don Valley (Caroline Flint) barely raised a flicker, let alone a flame. I grant that there was a good deal of heat, and she certainly generated plenty of friction, but there was not a gleam of illumination as to why, in power, Labour did so little to deliver the kind of market reform that the hon. Member for Liverpool, Wavertree (Luciana Berger) just claimed was so necessary. Is it any wonder that the right hon. Lady finds herself in the dark shadows of opposition, not the bright light of power?

I say that not in anger but in sorrow—sorrow not only because I know that the right hon. Lady is a great deal more than window dressing, and because she made some strong points about market entry and creating a more plural marketplace to create downward pressure on prices, but because, more profoundly, she knows, and I know she knows, that the debate on energy policy deserves better than a half-hearted advocacy of a half-baked motion, and because she also knows that the country’s future should be characterised by a cross-party approach and a bound commitment to plotting a path to a future where energy supply is secure; a future where we build an energy infrastructure that is fit for purpose; a future where the vulnerable are protected from unaffordable energy bills; and a future where the needs of the many, not the interests of the few, drive an energy policy that is for the people, not, as was sadly the case under the previous Government, coloured by the demands of the powerful.

Yes, absolutely that means market reform in order to foster clarity and sow certainty so that businesses can make their business plans and invest in the way I described. Yes, it does mean a generation mix sufficient to guarantee resilience and bring security, as my hon. Friend the Member for Tiverton and Honiton (Neil Parish) and the hon. Member for Wansbeck (Ian Lavery) said. It means, too, moving to a market that is more responsive and competitive, as my hon. Friend the Member for Hexham (Guy Opperman) advocated. It also means more nuclear, by the way, as Members who are as great fans of nuclear power as I am will be relieved to hear. And it means communities benefiting, guiding and owning the energy infrastructure, not having infrastructure, such as onshore wind turbines, scattered across our precious land like an atavistic echo of dark satanic mills.

I am reluctant to be too hard on the Opposition, however, because I never seek contumely, as you know, Madam Deputy Speaker, and because I know that they are handicapped by two things, among many. First, they know that tariffs are an important way of driving down the price people pay for heat and light and that the Prime Minister’s intervention and the subsequent discussions have opened up that debate in a new and helpful way. Secondly, they also know that in the 13 years for which they were in control there was none of the landmark legislation necessary to secure our energy future—they dithered, they delayed, they deferred.

Who was the ditherer in chief who presided over this spectacular inaction? It was none other than Disraeli’s new best mate, the Leader of the Opposition. Just a couple of years ago, as Secretary of State for Energy and Climate Change, he told the House that the purpose of his own energy Bill was

“to strengthen Ofgem’s powers in a number of respects and to make it a more proactive regulator”.—[Official Report, 7 January 2010; Vol. 503, c. 254.]

Yet now, when asked what they would do by a hard-pressed pensioner living in fuel poverty, by a hard-pressed farmer facing a cold winter or by a hard-pressed family anticipating Christmas with fear because of energy bills, Labour’s answer is clear as crystal: reform Ofgem and yet again rearrange the regulatory framework to invent a new quango. If they were running Byzantium, they would want it to be more bureaucratic.

In contrast, we will take direct action with a Bill published in weeks, not months, to help people get lower tariffs, using all in our power to address the issues of fuel poverty and bills that are too high for the vulnerable groups that have been supported by so many speakers in the debate. We are also providing immediate assistance to those who need help with their energy bills through our four-year warm home discount. The previous Government’s voluntary scheme meant that vulnerable people were offered different tariffs simply because they happened to have different energy suppliers, but our mandatory scheme helped 600,000 vulnerable pensioners last year alone through a £120 rebate on their energy bills.

The hon. Member for Liverpool, Wavertree (Luciana Berger) said that she would rather have Labour’s record than ours. Let me tell her that the number of fuel-poor households rose year on year from 2004 to 2009 from 2 million to 5.5 million. That is Labour’s sorry record in defence of the poor.

[Neil Parish]

DCC plc owned between 40% and 50% of the heating oil market and also trade as BoilerJuice and GB Oils. Will the Minister ask his officials to investigate the dominance in the heating oil market of one particular company?

[Mr Hayes]

I have to say that in my hon. Friend’s constituency there are really only two principal heating oil suppliers. He is right that that does not create necessary competitive pressure. I shall certainly ask my officials to consider such issues. Indeed, my hon. Friend made a powerful and persuasive speech on the subject during the debate.

We are providing support through the winter fuel payments and cold weather payments, which this Government have increased from £8.50 to £24. I accept that, as the hon. Member for Glasgow North West (John Robertson) and the right hon. Member for Birkenhead (Mr Field) have said, we need to target the support in the most effective way. Through a new obligation from 2013 we will require energy companies to deliver support for heating and insulation for the most vulnerable. This is about demand. As the hon. Member for Burnley (Gordon Birtwistle) said, we have too often debated energy only in terms of production and insufficiently in terms of consumption.

How curious it is that, bedazzled by the glitz and glamour of wealth, the Labour party pandered to corporate power over those 13 years. Keir Hardie must have looked down, wringing his hands in horror. They pander and ponder, bourgeois left minds honed to wander.

As an admirer of Joseph Chamberlain, only in my dreams did I believe that one day I would be the first Tory Minister in decades to advocate tariff reform at this Dispatch Box. Although these are different tariffs and different reform, I am delighted to do so today. I repeat that we will use all in our power to ensure through the Energy Bill that people get the best deal.

That is the difference between my party and the Labour party. We act; they meander, pander and ponder. They want to change the regulations; we want to change the policies. They want a different Ofgem; we want to make a difference to people’s bills.