Young Carers Support

Kerry McCarthy Excerpts

Tuesday 12th February 2019 Westminster Hall

[Paul Blomfield (Sheffield Central) (Lab)]

I beg to move,

That this House has considered support for young carers.

It is a privilege to move the motion with you in the Chair, Mr Owen. One of the special things about being a Member of Parliament is the opportunity we are given to find out more about the extraordinary people in the communities that we represent. Following my election back in 2010, there are few more extraordinary people who I have come into contact with than the young carers I have come to know.

John, for example, is 17 years old now and started caring for his mum when he was 10 years old. She has fibromyalgia. John says:

“This causes her muscles and bones to become weak and most of the time she is unable to walk or even get out of bed. As a young carer, I help my mum with shopping and things inside and outside of the house. I don’t get much time to go out with my mates or have much time to myself. My life is different because I am looking after my mum, making sure she is taking her tablets and eating and drinking.”

John was one of eight young people from Sheffield who I took to meet the Prime Minister last May. I thank the Prime Minister—she has one or two other things on right now—for finding time to sit down for half an hour with us. Another one of the group was Holly. She is now 14 years old but she started caring for her mum and her sister around the age of four or five. Her mum has an underactive thyroid and her sister has a reflux in her right kidney. Holly says of their life:

“I don’t get much time to be a child or to spend time with friends. I don’t mind, but it sometimes gets really frustrating if I can’t sit down for five minutes or so. My life is different to young people who aren’t carers, because I struggle a lot with life and have people to care for. They get to be kids and live their life. I still get to live my life but I have to an adult and I have to be very careful. The highs are that I get to spend lots of time with my mum and my sister. The lows are that I have no other family around, so it is just the three of us. It is very painful for me and very emotional to have to watch my sister screaming in agony.”

Holly and John are the lucky ones, because they have made contact with Sheffield Young Carers, of which I am proud to be a patron. They are getting tremendous support and the opportunity to meet and share their experience with others in the same position, but most young carers are hidden from view. One in 12 children and young people is taking on mid to high-level care for a family member. Their average age is just 12 years old, the average annual income for their families is £5,000 lower than others, 68% are bullied at school, 26% are being bullied about their caring role, 45% report a mental health problem, they achieve nine grades lower at GCSE and they are four times more likely to drop out of further and higher education. The right support is vital, and we owe them nothing less.

[Kerry McCarthy (Bristol East) (Lab)]

This is such an important issue, and I am glad that my hon. Friend is raising it. He has said, quite rightly, that in many cases young carers are unidentified within the system. Does he agree that it is important that schools and GPs, who will have contact with the people the young carers are caring for, do all they can to try to make sure that young carers are flagged up in the system, so they get the support that they need?

[Paul Blomfield]

I thank my hon. Friend for her intervention. She anticipates my next point, which is how important it is that we as a society identify young carers. When I sat down with our young carers in Sheffield and asked them what their priorities were, typically selflessly they put that at the top. They were not thinking of themselves but of the others who had not come into contact with the local group. As she points out, schools and GPs are in the best position to play that role.

Sustainable Seas

Kerry McCarthy Excerpts

Thursday 17th January 2019 Commons Chamber

[Kerry McCarthy (Bristol East) (Lab)]

This is another excellent report by the Environmental Audit Committee and I am very proud to have been a part it. The underlying principle that such reports should always follow is that the planet’s resources are precious and should be preserved, not plundered, whether they be fish or rare minerals that could be found in hydrothermal vents. That should underpin everything we do. Does the Committee Chair share my concern that while the Government are treading water, the race for deep sea mining and the rise of other environmentally damaging economic activities in the seas are going ahead untrammelled, and that there is a risk that if we do not act quickly, we will not be able to put the genie back in the bottle?

[Mary Creagh]

I thank my hon. Friend for her question. She is a fantastic member of the Committee and a real thought leader in many of the areas under discussion. As she said in Department for Environment, Food and Rural Affairs questions, she has been talking about the food system—“banging on” is how she put it, I think—and following the persistence principle for many years.

My hon. Friend is right about the race for deep sea mining. We are in a new wild west of exploration. The irony is that we are prepared to plunder and churn up the last great, unexplored wilderness—the equivalent of Yosemite national park and other brilliant places that people travel the world to see, such as our own Lake and Peak districts—so that we can have more “smart” phones. Those rare earth minerals are used in our smartphones and in some of our industrial applications. If we were better at recycling the rare earth elements in the 7 billion mobile phones, or however many there are, on the planet—I think there is at least one for every man, woman and child—we would not have to do that. A positive side-effect of the exploration is that we are finding out more about these unexplored areas, but the question is: what happens when we know they are there, and what will we discover? That is a problem.

Green GB Week and Clean Growth

Kerry McCarthy Excerpts

Monday 15th October 2018 Commons Chamber

[Claire Perry]

I thank my hon. Friend for sharing that information with us. He is absolutely right. One of the reasons for believing that we can safely extract shale gas is that we have the strongest environmental standards in the world when it comes to oil and gas extraction. We believe that we may, indeed, need to continue to strengthen them.

However, is it not interesting? My hon. Friend has dealt with the brunt of a lot of the protests against the shale site to which we have granted a licence, and I was very disappointed to see the hon. Member for Salford and Eccles (Rebecca Long Bailey) having a bit of a chit-chat with the protesters without bothering to go into the site to see its potential and the number of jobs that could be created by that vital industry.

[Kerry McCarthy (Bristol East) (Lab)]

As an electric car driver myself, I would point out to the Minister that the growth of electric cars means it is more imperative to invest in charging infrastructure, because it is pretty difficult at the moment to find a charging point that is not already being used. However, on the broader point, we are now talking about trying to move from a target of 80% in 2050 to net zero. Can she name one new thing she is doing, rather than going backwards, that will help us to meet that goal?

[Claire Perry]

I again have to commend the hon. Lady’s long-standing and non-virtue-signalling commitment in this area; she is one of the few people who takes the advice on diet. I would love to know about electric charging stations between Bristol and London, because I will hopefully be making that transition shortly.

The hon. Lady is right, however. One of the key things that came out of the IPCC report, and will come forward, is that we may overshoot. What are we going to do about that? What are the technologies that will help us get back under 2°? We are one of the first Governments in the world to invest substantially in greenhouse gas removal technologies. I am not saying that that is the answer—I would not want to go there, and I would rather change—but if we have to pull CO₂ out of the air or somehow get it out of the ecosystem, we will be one of the first Governments who are able to do that. That is something—[Interruption.] Well, I am afraid we need to consider it, and that is what the IPCC and the CCC have advised us to do.

Environmental Audit Committee

Kerry McCarthy Excerpts

Thursday 7th June 2018 Commons Chamber

[Mary Creagh (Wakefield) (Lab)]

I begin by thanking the Backbench Business Committee for allocating time today for me to present the Environmental Audit Committee’s recent report on greening finance. We launched our green finance inquiry in November to examine how the UK could mobilise investment in clean energy and encourage greater consideration of climate risk in financial decision making to avoid a carbon bubble. We held hearings with investors, asset owners, experts, financial regulators and Ministers. We also wrote to the 25 largest pension funds in the UK—responsible for nearly half a trillion pounds of assets—to see whether and how they are incorporating climate risk into their investment decisions.

The situation is vital to us all. The Committee on Climate Change estimates that we need to spend up to 1% of GDP, or £22 billion a year, to meet our carbon budgets. The Environmental Audit Committee found a dramatic collapse in low-carbon energy investment since 2015 that threatens the UK’s ability to meet its carbon budgets and tackle climate damage. Last year, Britain generated twice as much energy from wind as from coal, but green investment is faltering. In cash terms, investment in clean energy fell by 10% in 2016 and 56% in 2017. Annual investment in clean energy is now at its lowest level for 10 years. Is that a trend or a blip? It is too early to tell.

The Government must publish further details in time for the 2018 Budget on how they intend to secure the investment they need to meet our carbon targets. Providing clarity on the future of fixed-price contracts for renewables will be key to ensuring a pipeline of projects. We also need continuing access to development finance. The UK Government should negotiate to maintain the UK’s relationship with the European Investment Bank to provide funding for riskier, early-stage green infrastructure projects in the UK.

Let me set out how we want to see a green thread running through the investment chain. The 2008 financial crisis revealed the dangers of short-termism in our financial system. Climate change already poses material threats to our economy, our investments and our pensions. Seventeen of the 18 hottest years since records began have occurred since 2001. That means more droughts, heatwaves and wildfires and more extreme rainfall and flooding. Those risks will grow. In the time it takes today’s young people to reach retirement, the physical risks from sea level rise and more extreme weather will grow. That will affect investment in food, farming, infrastructure, home building and insurance, to name just a few.

Companies that do not make a timely low-carbon transition could also face costly legal or regulatory action. Some companies will be left behind by firms with cleaner, more efficient new technologies. Fossil fuel companies could be left with stranded assets in an overvalued carbon bubble—oil and coal deposits that they cannot burn—if we are to keep global temperature rise to less than 2° C. They also face increasing liability risks. The city of New York is taking legal action against five fossil fuel firms to recover the costs of protecting the city from flooding from rising seas caused by climate change.

The direction of travel for the global economy is clear from the Paris agreement and from what scientists are telling us about the risks of climate change. Despite that, the short-term horizons of many financial institutions, businesses and investment managers mean that sustainability risks are not always factored into financial decisions. The quarterly earnings cycle and structure of remuneration for investment consultants and fund managers encourages the pursuit of short-term returns rather than long-term considerations. Institutional investors can be prevented from acting on climate change due to confusion about the extent to which pension trustees have a fiduciary duty to consider environmental risks. KPMG’s 2017 corporate responsibility survey found that almost three quarters of large companies worldwide do not acknowledge the financial risks of climate change in their annual reports. More than half of institutional investors surveyed by HSBC said they were receiving “highly inadequate” information from companies about their approach to climate change.

The disclosure of climate-related risks would help financial markets work more efficiently. It would enable UK institutions and investors to position themselves ahead of the market to benefit from the low-carbon transition. My Committee is calling on the Government to clarify that pension schemes and company directors have a fiduciary duty to protect long-term value and should consider climate risks. Pension savers should be given opportunities to engage with decision makers about where their money is invested. Ministers must make it mandatory for large companies and asset owners to report their exposure to climate change risks and opportunities by 2022.

The UK’s existing framework of financial law and governance could and should be used to implement climate-related risk reporting. The Government should issue guidance making it clear that the Companies Act 2006 already requires companies to disclose climate change risks where they are financially material. Companies with high exposure to carbon-intensive activities should already be reporting on climate risks in their annual reports. UK financial regulators such as the Financial Reporting Council, the Pensions Regulator and the Financial Conduct Authority should amend their codes, rules and guidance to require climate-related financial disclosures. Companies and asset owners need time to develop how they report, but only if reporting is mandatory are we likely to see comprehensive and comparable climate risk disclosures. Embedding climate risk reporting in UK corporate governance and reporting frameworks could negate the need for new legislation. However, if regulators fail to implement that, there may be a need for new sustainability reporting legislation, such as France’s climate reporting law: article 173.

To those who ask whether we must do this, I say yes, we must. Climate change poses material financial risks to our pensions and our investments. To those who ask whether we are doing this, I say yes. The transition to a low-carbon economy presents exciting opportunities in clean energy, clean transport and tech that could benefit UK businesses. And to those who ask whether we will do this, I say that London is the centre of global finance, so let us make it a global centre for green finance.

I commend the report to the House.

[Kerry McCarthy (Bristol East) (Lab)]

I congratulate the Chair of the Environmental Audit Committee on, as always, doing a sterling job of steering us through the inquiry.

The Overseas Development Institute said in its evidence to our inquiry that the UK’s clean growth strategy is “undermined and contradicted” by our continued support for fossil fuel production overseas through UK Export Finance, which has been averaging £551 million a year in recent years. Does my hon. Friend agree it undermines our international climate commitments and our efforts to decarbonise our economy if we continue to support fossil fuel investment by British companies overseas?

[Mary Creagh]

I pay tribute to my hon. Friend’s always excellent and assiduous attendance and contributions. She is a real trailblazer and we are lucky to have her on our Committee.

My hon. Friend is absolutely right that the Overseas Development Institute has stated that our international approach is being undermined by UK Export Finance, and there is a case for this House, perhaps through a joint meeting of Select Committees, to examine where we are investing overseas, because, first, they may not be smart business investments and, secondly, they are undermining our stated international policy commitments.

There is perhaps a role for the Select Committee on International Development. The UK Government are doing brilliant work through the international climate fund and the UN. That work must not be undermined by businesses that are selling old technology, instead of taking this opportunity to leapfrog and, for example, put solar panels on mud huts in South Sudan, which is something I saw at a conference yesterday. There is an opportunity to leapfrog and not to make the same mistakes we made in our electricity generation.

My hon. Friend makes an excellent point with which I can only passionately agree.

Domestic Gas and Electricity (Tariff Cap) Bill (Second sitting)

Kerry McCarthy Excerpts

Committee Debate: 2nd sitting: House of Commons
Tuesday 13th March 2018 Public Bill Committees

[Dr Whitehead]

I fully accept that there are different interpretations of the best way forward within the overall agreed framework of where we want to go. Perhaps hon. Members take the perfectly reasonable, honourable and thought-out view that we have got what we want to say in the Bill, we have heard what Ofgem thinks it can do and we are happy to leave it there. My view is that it would be helpful to properly encapsulate our position on the Bill by saying in it what we want to happen—by setting an out-date for the considerations that Ofgem has to undertake before the cap becomes real.

Although I do not doubt for a moment the bona fides of Ofgem, or the sincerity of what Dermot Nolan said this morning, nevertheless, if we are not as clear as we can be about what we want to put forward in the Bill, it is conceivable—no more than conceivable—that someone could say, “Actually, we said five months, but some unexpected circumstances have cropped up—not a legal challenge, but other things—so we can push that further down the line. We’ll have to say that we are a bit sorry about that, but that’s how it is.” I do not want that circumstance to be even remotely in the minds of anyone at Ofgem over the next few months.

[Kerry McCarthy (Bristol East) (Lab)]

Is it not also a fact that in 2012, under the last Government, the then Prime Minister promised that he would force companies to switch customers to the lowest tariff? When he was talking about the “green crap” on energy bills, he also promised to use regulatory measures to reduce energy bills for consumers. As we have already heard, if we had introduced measures after last year’s election, when there was a manifesto commitment to do it, customers would have been protected in the cold weather we have just had. So I think it is only fair that people have some concerns about whether this is actually going to happen, when there have been so many false promises in the past.

[Dr Whitehead]

My hon. Friend makes a powerful point. Today, thinking about the cap, we are not in such a position that we can look back with complete equanimity and say, “Actually, everything that could have been done to hasten the cap, once it was decided that there should be a cap, has been done over that period.” There has been quite a bit of equivocation since, for example, the suggestion at the time of the Conservative manifesto for the last election that there should be a cap. It made an appearance but then went through a period when there seemed to be some resiling from that particular commitment.

As hon. Members will recall, there were indeed suggestions and discussions that Ofgem, in its own right, could and should undertake a cap: a cap would need no legislation from Government, so Ofgem could go ahead and put one in place. Indeed, as I recall it, a letter to Ofgem from the Secretary of State during the summer in effect said that. At the time, as hon. Members will also recall, Ofgem came back fairly publicly to say, “We are not convinced that we have the powers to do this,” or rather, “We may technically have the power to do this, but we wouldn’t be proof against legal challenge were we to go ahead and introduce a price cap administratively without the back-up of legislation from Parliament.”

As hon. Members will again recall, it was at that point—I think it was at the Conservative party conference—that the Prime Minister reasserted the fact that she wanted a price cap. Perhaps we will come on to what she said about the consequences of that price cap in a moment, but she certainly said at Conservative party conference that she wanted a price cap and that, in effect, legislation was to be introduced to produce one. So, arguably, we could say that, had we got on with legislation from the moment that the idea that there should be a price cap was put forward, we would not be sitting here today. Instead, we would be contemplating a price cap having been introduced, probably this autumn.

--- Later in debate ---

[Claire Perry]

I am sure the hon. Gentleman listened to the Prime Minister talking about the Labour party as being divided, divisive, tolerating anti-Semitism and supporting voices of hate. He probably does not want to trade quotes the Prime Minister has given.

However, let me move back to what we discussed in relation to the previous amendment. We talked extensively about how Ofgem needed to set the level of the cap to avoid crowding out investment, to encourage switching and, importantly, to set the cap at a level that does not facilitate strong legal challenges. That is why it is so important that we let Ofgem—which I think we all now believe does have the capability, and does share our commitment, to get this done by year end—get on and set the cap.

My hon. Friend the Member for Chelmsford made the point about setting an arbitrary figure. The problem with that is that this is not an average figure. We all know that we tend to work in averages, so just having that as the target would lead to all sorts of gaming.

The three things we all want are for the cap to come in, for it to be set at the right level and for it to be proportionate—once again, I wish we were not worrying about legal challenges, but we have to make sure. This is absolutely vital.

The hon. Member for Southampton, Test and I have discussed at length the difference between a cap and a freeze. We do want this cap to move over time. We know that prices go up as well as down. We know that the wholesale cost changes. We want to have the most efficient energy system we can, but the cost may increase. Having this number in the Bill would, in effect, bind Ofgem into setting a number that had no relation to the underlying costs.

I absolutely support the hon. Gentleman’s intentions. He and I both want to see these sorts of savings. In fact, the average spread between the cheapest tariffs in the market and the average of the standard variable tariffs is more like £300, so we would both confidently expect the savings to be greater than this. I will turn to the prepayment meter cap—the safeguarding cap—in a second in relation to the specific regard for vulnerable customers, but it is notable that the average saving after the April increase will be north of £100. Customers who are on that tariff are more than £100 better off than they would have been if that tariff had not come into place, so there is evidence that more than that amount could be achieved.

I will turn now to the second part of amendment 4, plus amendments 8 to 10 and new clause 1, which was tabled by the hon. Member for Kilmarnock and Loudoun.

[Kerry McCarthy]

If I heard correctly, the Minister was saying that people on the safeguarding tariff would be better off. However, in evidence this morning we heard that people will be eligible for it only if they have successfully applied for the warm home discount. Is that right? There is a waiting list and money runs out before time, so would she give consideration to the notion that it should be people who are eligible for the warm home discount and not just the people who have actually managed to get it?

[Claire Perry]

That is a very important point, and the hon. Lady is extremely knowledgeable in this area. She brings me to the second part, when I will hopefully address her point.

The safeguarding tariff came into force in April 2017. That perhaps gives the lie to the idea that the previous Government did nothing; this was all part of the pressure that we put in place. The tariff initially affects people who are on prepayment meters, who are often exactly as the hon. Member for Kilmarnock and Loudoun described—perhaps living in fuel poverty. That tariff is put in place by the CMA—it is nothing to do with Ofgem—and it will run until 31 December 2020. We have seen Ofgem extend that to this additional group—those who have claimed warm home discount—as the hon. Lady quite rightly said. She raises an interesting point, and we should take a look at it to ensure the maximum number of people are capable of achieving that safeguarding discount.

I asked the team to look at the impact on the bills of customers on these tariffs. Before the safeguarding tariff came in, the PPM average standard variable tariff was about 5% more expensive than the average standard variable tariff. Now, those who are on the PPM and vulnerable tariff pay on average 8% less than those on standard variable tariffs. That is absolutely working, independently of the Bill, to deliver the savings that we want to see for vulnerable and disabled customers. Those caps will continue to be in place, and it is very important that both are in place and that the Bill does nothing to remove eligibility for them.

I want to talk about some of the other duties on Ofgem, which are already covered in clauses 1(6), 7 and 8. They require Ofgem to protect all existing and future domestic customers, including vulnerable and disabled customers, and to consider whether effective competition is in place for the domestic energy supply as a whole. When effective competition is considered, it has to apply for all customer groups, including vulnerable and disabled customers.

--- Later in debate ---

[Claire Perry]

Yes. Again, I want to thank my hon. Friend and the Select Committee for bringing forward a series of recommendations, which we have accepted. He refers to a statutory instrument that is being started in the Cabinet Office, which I am assured will receive assent—or whatever the right word is—during the passage of this Bill, subject, of course, to cross-party support. That opens up the opportunity for much better data sharing to support vulnerable and disabled consumers.

It is extremely important that we continue to look at this group. We heard today that some of those we might consider most vulnerable are also the most assiduous switchers, because they simply do not have a penny to spare. I guess the issue I have, which is why we are here, is that we do not want people to have to invest the time in shopping around to feel that they are always getting the best deal.

Households that are receiving the warm home discount, in addition to qualifying for the safeguarding tariff, get £140 a year. Of course, we protect our pensioners, with up to £300 a year for winter fuel payments. Sadly, the cold weather payment was also triggered in the last couple of weeks, and that was another £25 during the cold snap. There is also the priority services register, which is a free service provided by suppliers for people of pensionable age who are disabled or chronically sick, have a long-term medical condition or are in a vulnerable situation. Those people go to the front of the queue should an emergency—a supply interruption—interrupt their heating or cooking facilities.

Finally, I want to mention the ECO consultation, which we will bring forward shortly. It is my intention, as far as possible, to pivot the whole of ECO to focussing on the challenge of fuel poverty and trying to make sure that those in the greatest poverty receive the greatest benefit, but also to use the programme to support more innovation and more targeting. I live in an off-grid area, and I am fed up of getting ECO leaflets through my door. It does not feel like the best targeted scheme to me, and I would like it to be targeted at those who are perhaps time-poor and need the help the most.

[Kerry McCarthy]

In the NEA’s evidence this morning, it said that one of the additional things needed for a package for the most vulnerable customers was energy efficiency measures. I know the Government are consulting on energy efficiency programmes, and particularly on amending the energy efficiency standards for rented homes. May I urge the Minister to make sure that that is brought forward quickly as well, because it will take a while to implement these measures in people’s homes? This is not just about lowering the bills; it is about making sure that people are not using huge amounts of electricity and gas in the first place.

[Claire Perry]

The hon. Lady is quite right: the great thing about energy efficiency in the home is that it cuts both carbon emissions and bills, so it is a win-win situation, and that is why we have set an ambitious target. She is right that we have started with homes in the rented sector and the social rented sector, and our intention is to make sure that progress is delivered as soon as possible.

--- Later in debate ---

[Claire Perry]

One little word has provoked a substantial and excellent debate. There is a genuine sense in the Committee that we all want to achieve the same thing: companies not being able to game the system, and tariffs that deliver for consumers and do what they say on the tin, so that if they say they are renewable, they are actually renewable, not just a package of greenwash. That is why I genuinely feel that the crowdsourced approach to legislation can be very good. I pay tribute to the Select Committee process, once again ably represented by my hon. Friend the Member for Stirling, who helped us to focus on the issue. I was pleased to hear several hon. Members comment that we have tightened up the wording accordingly.

We are wrestling with questions around gaming and what a green tariff looks like, and this question of “wholly” or “in part”. All those will be addressed by two processes, which I will talk briefly about. First, as the right hon. Member for Don Valley said, we have quite properly tasked Ofgem with looking at the whole issue. I think I am right in saying that it has never been asked to review the whole suite of green tariffs in the market and opine on whether they are any such thing.

A co-benefit of the whole process will be understanding what is out there, whether it is wholly, partially or not at all green, and what the price premium for some of those products is. I was a very early Good Energy customer, over 10 years ago, and—

[Kerry McCarthy]

So was I!

[Claire Perry]

I am afraid that, unlike the hon. Lady, I came off it, because it was so expensive—I apologise if she thought we were going to have a nice bonding moment over our green tariff. By the way, having heard the evidence, particularly from some of the more nimble companies coming in, I have every intention of looking very closely at changing my tariff again. However, the point is that the world has moved on. As the right hon. Member for Don Valley pointed out, prices have dropped and there is a question as to why we should be paying a premium tariff.

I would like the amendment to be withdrawn today—albeit on the basis that we do not yet have a brilliant fact base—but the offer I would make to every member of the Committee is for my team to put together a list of all the green tariffs in the market already and perhaps to ask for some evidence for to what the price premium is, so that when we look at this issue again on Report we will perhaps all feel a little bit better informed about this part of the market structure.

--- Later in debate ---

[Claire Perry]

I am sympathetic to my hon. Friend’s point; he is extremely knowledgeable in this area. However, as we have been through, particularly in the draft scrutiny process, we genuinely do not want tariffs that customers actively choose to be on, and which support the welcome development of creating demand for the renewable market, to be captured, as it were. The hon. Member for Nottingham North made the point about unintended consequences, and that is why word-by-word scrutiny is so important. The BEIS Committee supported that view, and I think the legislation has been substantially improved by that process. I am therefore less inclined for the proposal to be withdrawn completely, but I want to talk a little more about the point that the hon. Member for Southampton, Test made. I have talked about publication transparency. To me, transparency—having Ofgem look at these tariffs, probably for the first time—is an important part of establishing that this is a credible part of the market.

[Kerry McCarthy]

I should say that although I have been a Good Energy customer for some time, we now have Bristol Energy—there is that conflict between being green and giving support locally; I think it has now introduced a green tariff. Another west country electricity company, Ecotricity—which has made a submission to this Committee very late in the day—is concerned that if the cap is introduced across the board before the green exemptions are looked at, its customers might find their bills having to go down when the cap comes in, only for Ecotricity to have to turn round and say, “Actually, we’ve got this exemption now. We want to put your bills up.” At the risk of delaying the introduction of the cap, I urge the Minister to make sure that the green exemption issue is sorted out at the same time that the cap comes in.

[Claire Perry]

In standing up for her local enterprise, the hon. Lady pre-empts the second point I was about to make, which is that we will use transparency, but we will also use the Ofgem consultation process to do exactly that. Ofgem has to consult—it has to review the existence of these tariffs and understand what they mean—and it will have to do that as part of creating the cap, because it is a condition of introducing the cap that those exemptions are also carefully defined.

There is an interesting question. There is the transparency issue, there is the consultation issue, but the third thing is this: is it zero, 100 or somewhere in between? It will be explicit, I think, in conducting that analysis that Ofgem has chosen a level of what it thinks this level will be. I totally understand the point that the hon. Member for Southampton, Test made about us all wanting a world in which renewable energy is not intermittent. Indeed, I opened Clayhill solar farm, the country’s first subsidy-free solar farm, partly because it has managed to achieve on-site storage, providing both a better economic return and overcoming the problem of intermittency. That is all absolutely correct.

However, we are not there yet, and I was very struck by what my hon. Friends the Members for Wells and for Chelmsford and the right hon. Member for Don Valley said. They said that we want to be in a world where we are not stifling that evolution, but instead creating a demand for those tariffs in the future. It may be that, in setting out its view on what constitutes the tariff, Ofgem will say that it is 75%, or 95%, or 50%, and we will all have a chance to respond at that point. I absolutely accept the spirit in which the hon. Member for Southampton, Test tabled the amendment, but I fear, as we talked about, that it would have the unintended consequences of driving some tariffs out of the market and creating other perverse incentives.

I would like to put on record that the issue of gaming exercises us all. I have said this to the energy companies and I will say it face to face: if they think they should be spending their energies working out ways to game the tariff, as opposed to delivering better consumer value and service, we will put them on notice that that is exactly what none of us wants to see. That is a strong message that we have all delivered.

I am happy to provide more information to inform the debate. I have listened carefully to the excellent contributions, but I hope that the hon. Gentleman sees that this one tiny word creates a series of unintended consequences that perhaps weaken the cap and that he is therefore content to withdraw the amendment.

--- Later in debate ---

[Claire Perry]

You are sat in front of the iPad queen.

[Kerry McCarthy]

Mine has died.

[Dr Whitehead]

There you are—I am on my own now.

At the heart of this proposal is the rocket and feathers issue that my right hon. Friend the Member for Don Valley is famed for in her past interventions in this area, which is about the extent to which, when wholesale prices go up, energy companies put prices up pretty assiduously to compensate for the additional costs, but when wholesale prices come down, the same picture is not quite so much in evidence. For various reasons—buying along the curve, hedging in the medium term and various other things—the energy companies all say, “Oh no, we can’t possibly put our prices down, because of the positions we have taken.” It seems to work one way rather than the other.

Domestic Gas and Electricity (Tariff Cap) Bill (First sitting)

Kerry McCarthy Excerpts

Committee Debate: 1st sitting: House of Commons
Tuesday 13th March 2018 Public Bill Committees

[Bill Grant]

Q Is it 53 million installations? I think that is the target by—

Peter Smith: It would be slightly less than that, but it depends whether you think you need to put in SMETS2 meters, once they are ready, and replace the SMETS1 meters. We recognise the value of smart meters, particularly for low-income and vulnerable households, given the fear of an unknown bill. Estimated bills are the biggest concern that these guys get, so we recognise that they can have sufficient benefits. The trouble is we are so back-loaded now, the care and attention and extra help that we thought was going to be possible with smart meter roll-out is now going to be compromised, as everybody, as you say, is just going for volume.

[Kerry McCarthy (Bristol East) (Lab)]

Q This question is for NEA; I think you have already covered quite a bit of this. Obviously your remit is to look at issues of fuel poverty. You have already spoken about the warm home discount scheme and the safeguarding tariff, and the need for more engagement to make more people aware of those. You have just mentioned that smart meters have a role to play in fuel poverty as well. Do you think this Bill will help to address fuel poverty? Do you think there is enough in it? Do you think it really gets to the heart of it, or is it just about consumers being overpriced at the top end of the market and people being perhaps neglected at the bottom?

Peter Smith: First things first: it was reflected in my comments to the Business, Energy and Industrial Strategy Committee as well that NEA believes we must also tackle the vicious overlap between the households with the lowest incomes living in the least efficient homes. That needs to continue to be a priority, and, sadly, we have seen a dramatic drop-off recently in home energy efficiency delivery rates. You could build that into one condition by which Ofgem could make an assessment about whether we are now pulling on that lever as hard as can, maybe as part of an ambitious energy efficiency infrastructure programme.

The second thing relates particularly to the Bill. As I have described, there is a risk that we are assuming that the same people are covered through the SVT-wide cap as benefit currently—or would do in a few months’ time, with the extension of data-sharing powers—in the safeguard tariff. There is a difference between the people that it covers, so not everybody that will be protected by the SVT-wide cap will be protected by the safeguard tariff currently; and the values are very different—or could potentially be very different—in terms of the value of the safeguard tariff currently in place. That is about £100.

Given the drivers on Ofgem to create headroom to encourage competition and so on, that headroom might be significantly reduced. Therefore the general value that the two relative caps present might be very different. So in simple terms we cannot assure ourselves that the provisions in the Bill are consistent with the value that the safeguard tariff is currently providing. Ofgem need to consider that issue in relation to clause 2. It should be written into the Bill.

[Kerry McCarthy]

Q That was going to be my question. How should those things be done in clause 2?

Peter Smith: Clause 2 needs to say that there should be specific regard to customers that currently benefit from the safeguard tariff, and that the value of those relative price protections should be considered, to make sure that vulnerable customers benefit from the most attractive option.

[Kerry McCarthy]

Q Do you think the pool of people that currently are eligible for the safeguarding tariff is wide enough, or, in an ideal world, that it ought to be extended?

Peter Smith: Currently, the safeguarding tariff only targets those households that receive the warm home discount scheme. Those are typically poorer pensioners who automatically receive the warm home discount scheme, and some households in what is called the “border group”, which have to apply for support. Some households apply and are eligible, but miss out on the assistance because the programme is a first come, first served programme. Therefore we have been urging—and there were encouraging signs recently that this was going to be acted upon—that that should be extended to all households that were eligible for the warm home discount scheme, so it would cover those people who apply but maybe miss out on support.

[Kerry McCarthy]

Q At the moment, you have to be first in the queue to get the tariff. There is no reason why—

Peter Smith: You are either doubly benefited or doubly negatively impacted, because you do not receive the warm home discount scheme and therefore miss out on the safeguard cap, or you get the warm home discount scheme and the safeguard cap. We can reconcile all of that without these provisions. It was encouraging to hear Dermot Nolan say that he is minded to have due consideration of those issues when he sets the cap—because we could get into a situation where we look to preserve the extended safeguard cap at the same time as continuing with this endeavour. That would make sure that some of the issues I have spoken to are addressed. We would welcome that approach.

[Dr Whitehead]

Q Pete Moorey, your submission to the pre-legislative scrutiny of the BEIS Select Committee raised issues about the extent to which the remedies put forward by the CMA as far as market restitution was concerned were not, in your view, sufficient. Bearing in mind that it is going to be down to Ofgem to declare that the market is now functioning reasonably well and that the cap can now be taken off, what sort of remedies, in addition to those suggested by the CMA, might you have in mind to get the market working again? Do you think those should be introduced during the price cap or after it? Should they run after the price cap is over or concurrent with it?

Pete Moorey: We supported many of the remedies of the CMA, so while we did not believe that they would take us far enough to deliver effective competition, it was absolutely right that the CMA recommended that we would be testing and trialling new ways of engaging people in the energy market. We were disappointed that the energy industry did not respond effectively enough to that. We said to the industry immediately after the CMA inquiry, “Start getting on with it. Test and trial new ways of engaging particularly the most disengaged people with the energy market.” I think that a lot of that work should continue. The good news from Dermot Nolan this morning, and from other statements Ofgem have made over time, is that they are going to continue to do work on that, which is welcome.

We are not necessarily suggesting that there are other remedies such as that that could be trialled. It is more that we should be spending time considering what transformational changes can be made to the market along the lines that Dermot Nolan was talking about, particularly in his responses to James Heappey, to ensure that we have much more innovation in the market through new suppliers who can be tapping into the benefits that smart and other changes in the energy market will make. That is likely to be the transformation that will lead to a new kind of energy market where consumers are more engaged. That is the critical element, alongside all the key factors around switching levels—particularly engagement of more vulnerable consumers, energy satisfaction, trust in the market and so on—that we should be looking at.

As I say, simply removing the cap in 2023, and the market looking effectively as it is now, will not, I think, be the kind of change that we all want to see in the energy industry, and certainly will not deliver the kind of change that consumers need.

Budget Resolutions

Kerry McCarthy Excerpts

1st reading: House of Commons
Tuesday 28th November 2017 Commons Chamber

[Kerry McCarthy (Bristol East) (Lab)]

On a positive note, I welcome the proposed tax on single use plastic packaging. We know the huge environmental damage that is being done and, at the moment, there is little pressure on producers to reduce resource use and to make their packaging recyclable. It is left to local councils to clear up the mess and to local taxpayers to foot the bill.

I am afraid that that is about the only thing in the Budget that I feel inclined to welcome. Figures show that the public sector pay cap has reduced the disposable income of workers in my constituency by more than £45 million since 2010. Last week, I met representatives from the Royal College of Nursing to hear how low pay is causing a recruitment crisis: applications to study nursing have fallen by almost a quarter this year, at a time of acute staff shortages in the NHS. For nurses, who have seen a real-terms drop in their earnings of 14% since 2010, this Budget offered nothing.

What I am hearing from those charged with delivering essential public services in Bristol is that we simply cannot go on like this any longer. Bristol City Council is having to find more so-called savings worth £100 million over the next five years. Non-statutory services are being cut to the bone. What was particularly shameful was the complete failure by the Chancellor to mention social care, which accounts for close to a quarter of the council’s budget.

Avon and Somerset’s police and crime commissioner and chief constable were in Parliament last week. They did all they could when faced with Government demands for savings worth £66 million: modernising the way they conduct policing and streamlining their operations. They have been widely commended for the way in which they went about making those savings. Despite the loss of more than 600 officers since 2010, because of the cuts, neighbourhood policing was protected. The police and crime commissioner and chief constable said that the reward for all their work was to be told by the Government that they needed to come up with another £17 million of savings. They were here to tell Ministers that it simply cannot be done. They will not be able to provide the police service that the public expect and deserve if these cuts go ahead, but the Government are not listening to them, and there was not one mention of policing in England and Wales in the Chancellor’s speech.

Another example is St Brendan’s, a sixth-form college in my constituency, which was commended for its financial management by Ofsted in February. The principal is now telling me that he cannot go on like this. Sixth-form funding has been frozen at £4,000 per pupil since 2015—a real-term cut of more than £200. He is determined not to cut the curriculum, as many school sixth forms have been forced to do. This Government pay lip service to social mobility, but in truth they are squeezing young people’s life chances and denying them educational opportunities and the extra-curricular support they need.

The economic picture revealed by the Chancellor in his Budget shows us that austerity is not working. A braver Chancellor would have acknowledged that, put up his hand and admitted that he had got it wrong and chosen to invest in our councils, in our schools, in our colleges and in our nurses and police. The Budget was a failure.

Higher Education Funding

Kerry McCarthy Excerpts

Wednesday 11th October 2017 Commons Chamber

[Mr Speaker]

Order. I was happy to indulge the Minister and to listen to his mellifluous tones, but as he will quickly discover as part of his apprenticeship in this place, the Minister is not responsible for the observations on “Question Time” or elsewhere of the shadow Secretary of State on this or any other matter.

[Kerry McCarthy (Bristol East) (Lab)]

The Minister talks about the expansion in student numbers. How often does he have conversations with the local government and housing Ministers about the impact on housing pressures in cities such as Bristol and on council finances, given that students do not pay council tax and developers do not pay the community infrastructure levy? Although those students are welcome, it does come at a cost.

[Joseph Johnson]

The hon. Lady makes an important point. Our university students bring enormous economic benefits to cities up and down the country, which is why our universities are such important economic actors across the country. Clearly, local authorities have an important role to play in managing the pressures that students bodies can sometimes put on the provision of public services, and I work closely with colleagues in the Department for Communities and Local Government to keep abreast of the pressures she mentioned, but there is no doubt that our towns and cities are immeasurably the better for having universities within them. They are anchor institutions that are steadfast and have longevity in a way that many other economic entities do not, and we should wholeheartedly welcome their presence.