Energy: Fuel Poverty
Debate between Lord Marland and Baroness Maddock
Lord Marland
The noble Lord is obviously very knowledgeable about the private rented sector, and he knows as well as I do that we are very committed to trying to use every possible commercial measure to ensure that the private rented sector takes its homes out of the F and G categories. We are going to review that in 2016 and we are still open to considering it, but it is very much an imperative, a fundamental step, in getting these people out of fuel poverty—which incidentally is now reaching an horrendous figure. I am looking at my notes, which I do not often do; in 2004, 1.2 million people in the UK were in fuel poverty, and 4.5 million are now in fuel poverty. This is a serious task that the Government have to set about solving. All of us in this room want to see it solved and satisfied, and I am very grateful for the support that I get from all sides of the House to come up with a solution.
Baroness Maddock
My Lords, I am very pleased to hear the Minister’s reply, but it will be some time before the report on fuel poverty is published. In the mean time, are the Government considering making social tariffs for energy compulsory as a way of reducing costs for those in fuel poverty? If they are not, what else are they thinking about in the short term to try to deal with this severe crisis? The Minister has just given us the very bad figures.
Lord Marland
I re-emphasise that we are going to have an interim report in the summer and a final report in the early part of next year. That is very quick. It would be wrong for us to start putting up tariffs or making incentives while we are waiting for the eminent professor to come up with his conclusions, having consulted across the piece. Forgive me if I do not agree to the noble Baroness’s suggestion; it is obviously a good one, but we need to wait for the professor to deliver.
Warm Home Discount Regulations 2011
Debate between Lord Marland and Baroness Maddock
The Parliamentary Under-Secretary of State, Department of Energy and Climate Change (Lord Marland)
My Lords, I beg to move that the Committee has considered the draft Warm Home Discount Regulations 2011.
These regulations build on the voluntary agreement negotiated by the previous Government with energy suppliers. I applaud them for bringing forward the primary legislation in the Energy Act 2010, which has allowed us to make this scheme a reality.
For over five years, the numbers of households in fuel poverty has risen. It is estimated that in 2010, 4 million households were living in fuel poverty in England. The Government are committed to tackling fuel poverty and supporting low-income and vulnerable consumers to heat their homes affordably. The warm home discount scheme enabled by this instrument will help this to happen.
We are aware that fuel poverty is an issue that is best tackled via many angles, not just one. That is why there are four proposed elements to the warm home discount scheme. The first is the core group. A specified financial benefit of at least £120 per annum will be provided to households in receipt of certain elements of pension credit. Receipt of pension credit guarantee credit, which goes to some of the poorest pensioners, is one of the best ways to identify this group. We consider this group to be at high risk of fuel poverty. Over half of all fuel-poor households contain someone over 60, and over 80 per cent are in the lowest three income deciles.
The second group is the broader group. The same financial benefit specified for the core group will be provided to a broader group of households, who are fuel poor or vulnerable to fuel poverty. We have specified a number of state benefits that energy suppliers could choose from to identify those eligible for broader group support. Suppliers would also be able to propose additional criteria for approval by Ofgem, which would target support at those in or at risk of fuel poverty.
The third group involves the legacy spend. This will give a smooth transition from the voluntary agreement, which is an agreement that has been in place for the past three years between the Government and energy companies. It provides financial assistance to vulnerable consumers but the agreement ends this month. The amount of spending by suppliers on these legacy forms of support will decrease over the course of the scheme, as the amount of spending on rebates for the core and broader groups increases. The warm home discount scheme builds on the success of the voluntary agreement, and allows the Government to provide stronger support for the people who need it.
Lastly, there are the industry initiatives. Suppliers will be able to fund some activities in addition to the provision of direct financial support, which will benefit households in or at risk of fuel poverty. The scheme regulations detail which forms of support can be funded and include activities that improve targeting of the available support or those that provide energy advice to consumers. Through the scheme, those participating energy suppliers will provide support worth up to £1.1 billion over the next four years. But we must ensure that the resources we have are used effectively to tackle the problems underlying fuel poverty.
On 14 March, the Secretary of State launched an independent review of the fuel poverty target and its definition, led by Professor John Hills. Our intention is that suppliers’ contributions to the policy will be proportionate to their market share. Further regulations will be laid to allow a reconciliation mechanism to guarantee this, should the House support these scheme regulations. Subject to support from Parliament for the data-matching regulations due to be tabled later this year to help identify the core group, we estimate that around 2 million low-income and vulnerable households will be assisted by the scheme annually. On that basis, I commend this instrument to the Committee.
Baroness Maddock
My Lords, I welcome what the Minister has said, and these regulations, but I have some questions that I hope he will be able to help me with. I should also declare an interest: I am a vice-president of National Energy Action, a charity which campaigns to help people in fuel poverty. I know that the Minister himself, through the passage of the Energy Bill, is very committed to trying to alleviate fuel poverty in this country, but I wonder if he can help me.
The Minister estimated that 2 million households a year will benefit from this scheme, and he also explained that there will be legacy households from the voluntary scheme. Can he tell us how much of an overlap there is between these two groups? Maybe this is in the documents that go with the order—I did have a look at them, but I was not able to find this myself.
Also, following the Budget there was a lot of peripheral discussion about the fact that the upgrade on the winter fuel allowance that had been in place temporarily for two years was not continuing. I appreciate that the Minister may not be able to do this today, but is it possible to say what percentage of pensioners who get the winter fuel allowance are likely to be helped by this scheme? It is fairly important that we get that message out, given that there has been publicity in local papers about how terrible it is that people are losing their extra £50, or, if they are over 80, £100. It seems that many of the people who will find it hardest should benefit from this scheme, and it would be helpful if we could get those figures out.
I turn to my other question. Other than the pensioner or elderly group, will the Minister tell us more about how he sees other vulnerable groups, and who are they? I understand that the main concern of this is to protect the health and welfare of elderly people, but there are of course other vulnerable households—as indeed the noble Lord mentioned. I am thinking particularly of low-income families with young children, or people who have long-term disabilities or illnesses which mean they need to be kept warm.
I welcome this, I hope that the regulations that go with it later on are fairly speedy in coming, and I look forward to the answers from my noble friend.
Lord Jenkin of Roding
My Lords, like my noble friend I, too, welcome these regulations. They bring a little more certainty to what has hitherto been a rather uncertain variety of schemes.
My main concern has always been how the suppliers are intended to identify the householders that they are supposed to help. My noble friend will remember that we had some discussion about that on the question of the Green Deal. It is on these energy discounts and what have previously been called rebates on bills that the problem has been at its most acute. I do not need to go over the detail of this, but when we first debated the CERT scheme—it must be nearly four years ago—two things were evident. One was the considerable hostility of the industry—the suppliers—to becoming involved in this sort of activity. I think attitudes have dramatically changed, and I find in talking to industry representatives a clear recognition that helping those who are most likely to suffer fuel poverty is indeed very much part of their social obligation. I welcome this change of heart; a variety of factors have contributed to it and I do not necessarily need to go into them.
The second problem, as I said, has always been that of identifying the households. We pressed former Ministers very hard on this and eventually secured a clause in the Pension Bill which allowed Ministers in the Department of Work and Pensions to supply the names of pension credit pensioners, as households likely to be most in need. Given the problem that had been identified—I will forbear from giving a quotation in Latin, because that now is rather frowned upon in this House.
Energy Bill [HL]
Debate between Lord Marland and Baroness Maddock
The Parliamentary Under-Secretary of State, Department of Energy and Climate Change (Lord Marland)
My Lords, it is amazing that, although I thought this is a fascinating Bill, the Chamber seems to be emptying quite quickly. I will do my best to encourage everyone.
Before commencing these amendments, I would like to place on record my thanks to all noble Lords for their magnificent contributions. Although those on the opposition Benches will not like it, this has been done in the true spirit of coalition across all parties. I would particularly like to thank those on the opposition Benches for everything they have done in making this Bill fit for purpose. I have been incredibly well assisted by the noble Baroness, Lady Northover, who has worked tirelessly on our account and I thank her very much.
I also thank our officials for their tireless work. The Bill will have passed through this House voteless—at least I hope that it will—and that would not have happened without substantial briefing and explanation to noble Lords during the course of the Bill. I want to thank my officials and everyone for that. As such, these government amendments show that we have listened to noble Lords, particularly on the opposition Benches and my noble friend Lord Deben. I hope that the first group of government amendments are accepted by the House.
Baroness Maddock
My Lords, during the passage of the Bill, I moved several amendments on, and we had long discussions about, the private rented sector. At Report, the Minister said that he agreed in great part with what I was saying and that he hoped to be able to bring forward amendments on the private rented sector going further than they had previously. They have gone a little bit further today. I hope that, as the Bill passes through another place, the Government will be able to take a slightly closer look at the private rented sector.
In the time that we have been discussing the Bill, the most recent English housing survey has been published. It shows that the number of properties in the private rented sector has increased by 1 million in the past 10 years. Such properties now account for 15.6 per cent of England’s housing stock and that number appears to be rising all the time. I remind the Minister, although it will not be his responsibility in the other place of course, that 20 per cent of private rented sector households live in fuel poverty. If we look at the bottom end—at bands F and G, which are the groups that I have spent a lot of time discussing during the passage of the Bill—that rises to 42 per cent. I have said at least twice during the passage of the Bill that, in many cases, we are footing the bill for the rent of these properties through housing benefit.
I thank the Minister for moving a little in my direction and I hope that his colleagues in another place will be able to take a further serious look on these issues.
Energy Bill [HL]
Debate between Lord Marland and Baroness Maddock
The Parliamentary Under-Secretary of State, Department of Energy and Climate Change (Lord Marland)
My Lords, the noble Baroness has told some shocking tales. Funnily enough, I do feel that I stayed in one of those properties in my younger days. It was not at all comfortable, and I have a feeling that one of my sons, who is a student, is staying in such a property at the moment. It is a terrible tale and the whole idea of the Green Deal is to remove this from the equation. But let us stand back for a moment and work out what the Green Deal is. It is about giving people the opportunity to drive energy-efficiency endeavours into their homes, and to reduce the cost of electricity and thus to have all the ongoing effects that that may have in their lives. However, the Green Deal is not a prescriptive document, one that determines that “You, you and you should have this, this and this”, but rather it is to encourage and provide the facilities by which people can take advantage of situations.
Of course, there are also some very good landlords. There is some terrible accommodation, terrible houses and very bad landlords, but there are also some very good ones. So we have to look at this. However, we must start from the standpoint that we are committed, as a Government, to ensuring that the Green Deal works at all levels, and we are committed, as a Government, to ensuring that this drives hard into the private rented sector. But as I have said on a number of occasions, this is a market-driven endeavour where we want to see natural buy-in by all forms of property owners, including landlords, and we expect them to improve their properties to an acceptable standard. We would all love to wave a magic wand and say that the minimum standard should be band E, but the standard of what? We have inherited an energy performance certificate which was designed for people buying and selling houses, not for those relevant to the Green Deal. So until we have redesigned the energy performance certificate to make it fit for purpose within the Green Deal rather than for buying and selling houses tied into the now abandoned HIPs, which as I have told the House on many occasions we are working extremely hard to do, it would be wrong to be prescriptive about that element.
We are starting from the standpoint, which has been excellently portrayed by the noble Lord, Lord Best, of the 1.2 million properties that fit into the category of the private rented sector. The noble Baroness, Lady Smith, rightly pointed out that 150,000 of them are in bands F and G. One would hope that landlords are listening to what the noble Baroness and my noble friend Lady Maddock are saying and will feel compelled to raise these houses up to an acceptable EPC level of band E and above. We want also to ensure that local authorities buy into this, along with all other housing sectors. Further, we have been briefed by ACE and Friends of the Earth, and we are very receptive to their briefings. But we are at an early stage in the passage of the Bill and we are starting to shape it. One of the fundamental timescales that we have established is a review in 2013. If landlords in the private rented sector do not adopt decent standards by 2013, we will be able to establish where the pressure points and the weaknesses lie.
We believe, with the encouragement that the Green Deal gives to property owners, that they will take it up, when the new EPC is produced, to level E and beyond, and this Government are fundamentally committed, as the sponsor of this Green Deal, to ensure that they do. It would be ridiculous for us to think that we have achieved things if we have not driven hard to get the public rented sector out of the F and G bands. There is a lot of work going on to get to this position. We do not want to get to this position until we have thoroughly gone through the process of redesigning the EPC and setting a framework that people can attach themselves to. We have given people the opportunity to use market forces and their best endeavours and best practices to achieve a minimum standard. If we find that they have not taken that up, of course we will come down like a ton of bricks, because it will show that what we have set out to achieve has not succeeded.
Throughout all these debates, which have been extremely well enunciated, and have found great favour with us, we have listened. We are all, after all, singing from the same hymn sheet, in particular on Amendments 69, 70, 76, 84, 89, and 94 to 99, which really deal with the materiality. It would be ridiculous if this did not find favour with us in terms of a form of words. I accept in principle the intention of this. I have listened to what noble Lords have said in Grand Committee, I will warmly consider this element of the amendments, and we will take the view of tabling this as a government amendment as the Bill carries on with its passage. I hope that that will find favour with noble Lords, and will demonstrate that, on the one hand, we have listened and that we all understand the problem that we all face, and, on the other hand, that we understand that, in the timeframe available and with the concept of the Green Deal, we must make an evaluation. Once we have persuaded the market to accept an opportunity, if it does not take it up we must evaluate it in a very short timeframe, which will be the end of 2013. If the market does not respond to that, we will then bring into action a set of standards, which we will help it to maintain. With that, I hope that this finds favour with the noble Lord, Lord Best, and the noble Baronesses, Lady Maddock and Lady Smith, who made excellent speeches, and that they will not press their amendments.
Baroness Maddock
My Lords, perhaps I should say that my glass is half-full at the end of that. I obviously think that this is a really important issue, or I would not have gone on at such length in Committee and here on Report. I take issue with my noble friend. As far as I remember, the energy performance certificates were not there because of what we are doing on buying and selling houses. It was a European piece of legislation, and it got thrown in with the HIPs because it was the best way of dealing with it. At the time, I thought it should be separate, and spoke on that issue. We need to look at it carefully, because the EPCs are part of what we are required to do in signing up to our responsibilities in Europe for reducing carbon emissions.
I will withdraw my amendment, but I look forward to what the Minister has promised. As I say, I feel my glass half-full at the moment. Maybe he will be able to top it up at some point. I beg leave to withdraw the amendment.
EU: Emissions Trading Scheme
Debate between Lord Marland and Baroness Maddock(13 years, 10 months ago)
Lords ChamberRead Full debate Read Hansard Text
Lord Marland
The short answer, obviously, is yes. As I referenced earlier, the airline industry—as the noble Lord will know as an expert in the transport field—will join it in 2012. We must look further to reduce our greenhouse gas problem.
Baroness Maddock
My Lords, as the Minister indicated in his earlier answers, there are other emissions trading schemes around the world. Can he tell us how many have had similar problems to the European one and whether there are any lessons that we can learn from them?
Lord Marland
There are a huge number of lessons that we can learn from every attempted fraud. I am not familiar with the detail of these frauds across the world but I am familiar with the detail of those in Europe. There are five or six countries which have endured fraud which is pretty well documented. I will not go through each of them now, or their extent, but we must learn from each of these problems. We live in a very sophisticated world of fraud which changes the whole time and we must make sure that our registry is fit for purpose in that regard.
Energy Bill [HL]
Debate between Lord Marland and Baroness Maddock(13 years, 10 months ago)
Grand CommitteeRead Full debate Read Hansard Text
Lord Marland
The noble Baroness is right: I think that that debate showed that there are gaps. That is why I prefaced my opening remarks by saying that we have to take away a number of issues—that is the whole point of Committee—and we shall be looking at whether we can improve those gaps, as we are committed to doing. From my point of view, it was an extremely useful and valuable debate, and I assure the Committee that we will be taking those issues away.
Baroness Maddock
I thank the Minister for his comments. I am very grateful to the noble Lords, Lord Whitty and Lord O’Neill, and I am also grateful to the noble Lord, Lord Deben, for putting his name to my amendment. Between us, over the years we have had quite a lot of experience of the issue that we are dealing with here—that is, the private rented sector. I am not in total disagreement with my noble friend Lady Noakes, in that I am not in favour of unnecessary regulation. However, for those who have been dealing with the bottom end of the rented market for a number of years, there comes a point when you have to try to do something about this problem. That is particularly important when we sometimes pay out a huge amount of housing benefit on these houses. We have to remember that; I really do not see why taxpayers should pay housing benefit for substandard properties.
We are getting to the stage where we need to get to grips with this matter, and I am really pleased that this Government have grasped the nettle on the private rented sector. Therefore, I agree with my noble friend that we do not want unnecessary regulation but I am sure that we all want people to live in decent homes. With that proviso, and thanking my noble friend for the point that he made about agricultural tenancies, I beg leave to withdraw the amendment.
Energy Bill [HL]
Debate between Lord Marland and Baroness Maddock(13 years, 11 months ago)
Grand CommitteeRead Full debate Read Hansard Text
Lord Marland
Perhaps I should clarify that the authorities in Scotland will and can do whatever they want with their own powers. We are acting only as a facilitator for them to consider enacting those powers. I hope that that clarifies the matter for the noble Duke.
Baroness Maddock
My Lords, I thank the Minister for his reply. In a minute, I will be moving further amendments that are about regulation in local authorities. I hear what the Minister says. We may want to return to this another time, depending on the outcome of further discussions on this area.
I say to the noble Lord, Lord Deben, that, not for the first time, I am grateful to him for his support in this sort of area—the last time being rather long ago in another place. I am very pleased to see the noble Lord here because I know that he is a great enthusiast of the sorts of things that we are trying to put forward in this Bill. In the mean time, I beg leave to withdraw the amendment.
Lord Marland
With all due respect, I think that I answered that. I said that it is very unlikely that there will be negative value, but the market makes the judgment if something has gone down in value. If you put a property on the market or to rent, the market determines whether its value has gone down. That is how every price is achieved. I hope that that answers the noble Baroness—she is looking a little bit negative. I cannot imagine that we can set up a system that prescribes that a property is worth this or that amount; the market determines that.
Baroness Maddock
My Lords, I am grateful to the Minister for his reply and to other noble Lords who have taken part in the debate on this group of amendments. As the noble Baroness, Lady Smith, said, when we are looking at some of these very low rated properties, we are not talking about a lot of money to improve them one step up to the next band. I suggested some figures at the beginning and the noble Baroness, Lady Smith, repeated some of them. When we discuss this, I think that people are not really looking at what these properties are like. We may be talking about insulation and draught proofing, so some measures will involve quite low amounts of money. Therefore, in persuading tenants to improve the property’s rating, it may not be very much extra that they will be asked to contribute.
I am not quite clear what the Minister was saying in his answers to my amendments. I think that he was saying, “Yes, we understand all of this, and when we eventually get around to making regulations, we might do something a bit like what you are suggesting”. I am not sure whether that is what he was saying, but I will look at what is in the record. Perhaps at some point we can have a discussion about this. If we are keen to get local authorities and landlords working together to improve properties, we need a little more than is on the face of the Bill at the moment.
Lord Marland
Would the noble Baroness allow me to reply? What I am saying is that we must not prescribe regulation now for the private rented sector. This whole Bill is about trying to enable the sector to pick up the Green Deal and run with it. If we start saying, “If you don’t run with it, we’ll do this, that and the next thing”, we will be making a rod for our own back. That is the whole point. I think we are agreed on this particular subject of a review—an early review—and then a second review to work out what the dynamics are. I hope that answers her question; but, as always, I am very happy to extend the invitation to discuss the matter further outside the room.
Baroness Maddock
My Lords, the offer of further discussions might be helpful, because I think that, by using some of the legislation that we have already got and by being a bit clearer about the dates when regulations and so on might come into effect, we might be able to get landlords to start taking action earlier. We may be able to explore that between now and Report stage. In the mean time, I beg leave to withdraw my amendment.
Baroness Maddock
My Lords, my name is attached to the amendments to which the noble Lord, Lord Best, has just spoken. I do not intend to say much. It is clear from the amendments I moved earlier that I have a great deal of sympathy for what the noble Lord is saying. Perhaps we can also discuss between the Committee and Report stages whether there is some merit in doing more to encourage the private rented sector and to help local authorities with this work. I support the noble Lord, Lord Best, and I hope the Minister can at least agree to discussions on the detailed proposals that have been put forward.
Lord Marland
I am very grateful to the noble Lord, Lord Best, and for the support expressed by my noble friend Lady Maddock. The noble Lord spent a constructive Sunday writing his excellent speech because it has given us a good picture of what is going on in the sector. In many ways I wish he had spoken earlier, because he would have set the scene nicely for some of the debates today, as indeed he did at Second Reading.
Amendments 21ZA and 21ZB would insert two new clauses setting a minimum energy efficiency standard. However, they go further in that they would prevent the renting of properties that do not meet the minimum standard. They would also allow for the Secretary of State to suspend regulations with any local authority area if it is found that regulations are having an adverse effect on supply. Amendment 20TA would also prevent a landlord letting a property if a notice had been served by a local authority but not complied with.
The amendments raise an interesting proposition: that of using a minimum standard to improve performance in the sector and preventing properties that do not meet this new standard from being let. I read them with interest and welcome their intention to create a level playing field in terms of energy efficiency within the sector. However, I cannot accept the proposals for two reasons. First, I reassure the Committee that the provisions as currently drafted in Clause 37 already target the worst performing properties. Secondly, and most important, we will achieve this without setting minimum standards, other than those that have been referenced, which could be viewed as a barrier to new landlords entering the market. We are trying to plot a pragmatic and sensitive course.
Amendment 21ZB would give powers to the Secretary of State to suspend minimum standard regulations in local authority areas where they could be shown to be impacting adversely on the supply of properties available. As I have outlined, it is not our intention to impact on the market; in fact, it is the opposite. We want to create a more attractive rental market for improved properties. The review already creates a safeguard. It will take a very careful look at the impact of potential regulation on the rental market across the country.
I turn to the issue of timing, which we have covered quite frequently. Amendment 21ZA proposes that regulations, if any, be made no later than 1 January 2016. The noble Lord, Lord Best, has already referred to that. I hope that this explains the Government’s position. I am extremely grateful for the very valuable input, but I hope that these amendments will not be pressed.
Lord Marland
I am grateful to my noble friend Lady Maddock for putting forward the amendment. Obviously it has considerable merit. The greater the fine, the greater the determination we show to achieve what we set out. On this occasion, contrary to the last, I agree with my noble friend Lord Jenkin of Roding—generally I agree totally with the noble Lord—that £5,000 is a reasonable limit. It is a considerable amount of money that is in line with existing limits for the amounts that local authorities can fine landlords for letting out substandard and hazardous accommodation. On that basis, and with due respect, I invite the noble Baroness to withdraw her amendment. As she rightly says, we have spoken to other amendments covering various parts of the Bill, and no doubt we will in future as well.
Baroness Maddock
My Lords, as I was only speaking to that amendment, I cannot withdraw it. However, I can withdraw Amendment 20Z that led this group. Given the discussions that we have had, I am prepared to do that. However, in doing so, I will say that it would be helpful to have some discussion about how we can encourage landlords to improve their properties, particularly the very bad ones—I hope that that will happen—and about how we can involve local authorities. I am particularly keen on local authorities because of some of the powers that they have under other legislation, which I will not mention again by name. That is one reason why I am keen to see them involved. I beg leave to withdraw Amendment 20Z.