Oral Answers to Questions

Lord Lilley Excerpts

Thursday 5th February 2015 Commons Chamber

[Amber Rudd]

Small businesses are essential to economic growth, and we are determined to support them. I understand the hon. Gentleman’s point, which is about the support for solar through our feed-in tariffs. Owing to the reducing capital costs of solar, we have reduced the support. It is essential that we strike the right balance between using taxpayers’ money and supporting businesses, but I appreciate his point and will bear it in mind.

[Mr Peter Lilley (Hitchin and Harpenden) (Con)]

Given that we are constantly told that the reducing costs of solar panels will soon render them competitive with conventional electricity, why do we not abolish subsidies completely? Or do Ministers not believe their own projections?

[Amber Rudd]

My right hon. Friend is entirely right. The reduction in cost and the success of solar PV mean that, according to the industry itself, it will become subsidy free, we hope, by the end of the decade. That is because of investment under this Government. It will be something to celebrate, and something that the taxpayer, as well as everyone in the Government, will appreciate.

--- Later in debate ---

[Mr Davey]

That is a very significant issue. When we were working on the fuel poverty strategy, using the analysis of Professor John Hills—the new method of looking at fuel poverty—we found that it uncovered a number of things that were not so obvious in the old method, such as people in off-gas grid homes being among the most fuel poor, and far more families being in fuel poverty as a proportion of the overall total. That is why the warm home discount is so important; it targets money on not just pensioners but low-income families. The fuel poverty strategy will now address that matter, too.

[Mr Peter Lilley (Hitchin and Harpenden) (Con)]

Earlier, the Under-Secretary of State said that, by 2020, we will see the availability of more advanced lower-cost solar panel technology, which will not require subsidy. Why not wait until 2020, rather than encouraging people to install high-cost, immature versions of that technology that will require us to commit to paying out subsidies right through to 2030?

[Mr Davey]

We have been cutting solar subsidies throughout this Parliament—indeed we have come under great attack for so doing, including from the Opposition. We are consulting on closing the renewables obligation system to the solar industry, and again that has led to a lot of criticism. However, I do not apologise for taking those measures, because it is important that we get best value for money for the taxpayer while encouraging the very important solar industry.