Energy

Alan Brown Excerpts

Tuesday 7th March 2023 Commons Chamber

[Amanda Solloway]

The instruments were laid between 11 January and 23 February 2023, and their purpose is to ensure that benefits from the alternative fuel payment, both domestic and non-domestic, are passed through to consumers. Throughout this winter, the Government have delivered critical support to households, businesses and other non-domestic consumers in response to the unprecedented rise in energy prices. The Government brought forward emergency legislation on energy support, paving the way for this support package to be delivered rapidly across the entire United Kingdom.

The alternative fuel payments scheme provides support to households, organisations and businesses that do not use mains gas and use alternative fuels such as heating oil. Eligible domestic consumers using alternative fuels will receive a one-off fixed payment of £200. Non-domestic consumers will receive £150.

[Alan Brown (Kilmarnock and Loudoun) (SNP)]

Can the Minister tell us how many households are still waiting to access the £200 payment?

[Amanda Solloway]

I thank the hon. Gentleman for that question. With his permission, I will get back to him with the answer.

The pass-through requirement regulations are an important part of the support package and of ensuring that support reaches those who need it. The alternative fuel payment and non-domestic alternative fuel payment pass-through schemes set out in the regulations take the same approach as other energy schemes, particularly the energy bills support scheme and the energy bill relief scheme. They make it mandatory for intermediaries to pass the financial benefit of the schemes through to end users, which is necessary because that benefit is being delivered through electricity suppliers. In some cases, a supplier will have a contract with an intermediary such as a landlord or a heat network rather than with the end user, so we need to ensure that the support that it provides to the intermediary is passed on to the end user in a fair way.

Let me clarify what I mean by “end user”. In the case of both the alternative fuel payment and the non-domestic alternative fuel payment, an end user is an individual who consumes energy and pays for its usage through an intermediary such as a landlord. We are talking about tenants of different types—they could be domestic tenants, businesses or any kind of organisation.

Like other energy schemes, the schemes set out in the regulations require that support be passed on in a “just and reasonable” way. The regulations have been drafted in that way to account for the many kinds of relationship between an intermediary and an end user. If we used a narrow definition of “just and reasonable”, we could run the risk of inadvertently excluding some intermediaries from the pass-through requirements.

The regulations also accommodate scenarios in which there are multiple end users to whom intermediaries pass on support. They make it clear when and how intermediaries should communicate with end users regarding the benefit that is being passed on.

Our approach to enforcement is consistent with the approach taken in other energy schemes, particularly the energy bills support scheme in Great Britain. If an intermediary does not pass on the benefit to a user who is entitled to it, that user will be able to pursue recovery of the benefit debt through civil proceedings. Should a court rule in the end user’s favour, the end user will be entitled to the payment plus interest at 2% above the Bank of England base rate.

The Government have published guidance on gov.uk to ensure that the requirements are clear to all parties. If necessary, there are also template letters that tenants can use to contact their landlords if they are concerned about their energy bills. The Government are working with a wide range of stakeholders to ensure that the pass-through regulations work for everybody in scope, including vulnerable people and vulnerable groups.

--- Later in debate ---

[Alan Brown (Kilmarnock and Loudoun) (SNP)]

It is quite incredible that we are debating these SIs in the main Chamber today. They should never have been on the Floor of the House. This is proof that, apart from othering asylum seekers, this zombie Government are just padding out what would otherwise be normal Government time. It is also ridiculous that, six months down the line from announcing the energy support scheme, so many people are unfortunately still waiting for the moneys they are due. Can the Minister confirm whether these regulations and the applications being opened up for the alternative payment will now resolve the park home issue as has been long promised? For clarity, will these regulations resolve that issue?

It would be good to know how many people are still waiting on their moneys. Also, why do so many people have to jump through hoops and apply for alternative fuel support? Why do people in areas such as the highlands and islands, where there are many more people off the gas grid than there are in Northern Ireland, have to apply when every household in Northern Ireland gets the £200 payment anyway? It is clear that people in the highlands and islands of Scotland have fallen through the cracks, and the Government should look at this again, especially if they are going to repeat the scheme in future.

The first SI is about the pass-through of payments from the likes of commercial landlords. Does the Minister know how many payments are estimated to have been made to landlords that still have not been passed on? As the shadow Minister, the hon. Member for Southampton, Test (Dr Whitehead) said, the Joint Committee on Statutory Instruments confirmed that the Government expect information to be provided to them from these commercial landlords, except that there is no enforcement mechanism. This is a defective SI, yet despite that, the Government have chosen to bring it back to the Floor of the House in the main Chamber and do nothing about support or about changing the defects reported by the Joint Committee. Have the Government considered any such mechanism to allow the enforcement of information reporting? If not, and if there is no way to enforce it, how can they assess whether this support, this taxpayers’ money, is going to those who need it, rather than being held up by intermediaries? This money should be passed on to the people to whom it is rightfully due.

The truth is that there is no incentive for commercial landlords to report, even those who are doing the right thing in passing on the money, because it is just time-wasting for them. Why should they see any merit in reporting what they have done? That means that, overall, the Government will not be able to assess the scheme’s success in getting the money to those to whom it is due.

The key question is, why is the onus being put on individuals to pursue any moneys they are owed as a civil debt? In reality, how many people know they can go to court to claim the £200 they perhaps did not receive? Again, that is beyond most people’s knowledge and ken.

Looking forward, as we come to the end of the initial energy price guarantee scheme, and given that the Government have borrowed a lot less money than they thought they would, they really must look at reducing bills. Even holding bills at £2,500, on average, is not enough because it would keep 6.5 million households in fuel poverty. We are calling for a £500 reduction. It is also critical that they review the support for small businesses, which will receive an estimated £200 on average. That is a drop in the ocean compared with their high energy bills. The Government must look at that as we come to the new financial year.