Domestic Gas and Electricity (Tariff Cap) Bill

Andrew Lewer Excerpts

3rd reading: House of Commons & Report stage: House of Commons
Monday 30th April 2018 Commons Chamber

The final amendment on the amendment paper is amendment 1. The right hon. Member for Birkenhead (Frank Field) did not speak to it for long, but I empathise with his arguments. My only concern is that, for it to work properly, we would need the roll-out of SMETS 2 meters, as the SMETS 1 meters, which are currently being rolled out, do not enable what the amendment seeks to achieve in terms of automatically providing better tariffs for customers. None the less, I certainly agree with the principle of the amendment.

[Andrew Lewer (Northampton South) (Con)]

I welcome the opportunity to speak on the Bill and the amendments. Millions of consumers in the UK are facing challenges with their energy bills, and I find it outrageous that loyalty is punished by some energy companies. It is counterproductive, especially for those speaking up for the free market. We must be careful, however, not to commit the politician’s syllogism from “Yes, Minister”: “There is a problem. Something must be done. This is something, so let’s do this.” The amendments seek to ameliorate that.

I am not a great believer in the idea that the gentlemen in Whitehall know best when it comes to running energy, and I worry that the idea that said proverbial gentlemen in a panel are best placed to determine energy prices gives succour to Labour ideas that it, as the state, is best placed to run the whole sector. The fact that Labour does believe that is precisely why I would not support any of its amendments but will stick with a Government who, notwithstanding their occasional prices and incomes board-type moments, represent a strong—indeed, the best—bulwark against socialism.

I will not go into huge technical details other than to praise the work and determination of my hon. Friend the Member for Weston-super-Mare (John Penrose), who has argued for a more dynamic solution to this problem, proposing a maximum mark-up between the ultra-competitive, consumer-friendly deals and the default tariffs that loyal customers pay. I supported his amendments and the intention to point out a better way of stimulating the market towards greater fairness via relative cap mechanisms.

Nevertheless, the fact is we are facing an urgent problem for which we need an urgent solution. To this end, I will support the Bill with—and, indeed, because of—the added sunset clauses, for which I thank the Minister, and which make this a temporary measure up until 2020. I hope that comments from me and others will point the way ahead at that time.

[Patricia Gibson (North Ayrshire and Arran) (SNP)]

I am delighted to support the Bill, and I am glad to have worked with the hon. Member for Weston-super-Mare (John Penrose), who was instrumental in its introduction and in pushing for the cap. It is disappointing that Ofgem required five months in which to implement it, but at least we shall have it in time for winter 2018.

The amendments to support and protect vulnerable and domestic consumers during the cap’s implementation are of course welcome, and it is right for the Minister and Ofgem to take account of the distinct needs and circumstances of vulnerable consumers when setting the cap, but since entering the House I, like the hon. Gentleman, have developed a healthy scepticism in my opinion of the way in which regulators, including Ofgem, go about their business—or not, as the case may be.

More than a quarter of households that contain a disabled person—27%, or about 4.1 million—spend more than £1,500 a year on a year on energy, and 790,000 of those spend more than £2,500. In my constituency, consumers are overpaying for electricity by £5.5 million a year. There is no denying that high energy costs have a serious impact on disabled people’s financial resilience. They limit those people’s ability to access employment and training and savings, and their ability to participate fully in society. Vulnerable and disabled consumers face higher energy costs than any other consumers, and that must be factored into any consideration.

As we heard earlier, the amendments that are intended to establish either an ongoing tariff differential or a relative cap are simply not robust enough to ensure that consumers would ultimately benefit from them. There is a risk that both the relative tariff differential and the relative cap could trigger unintended consequences, such as energy companies’ raising their minimum tariffs to meet the required difference from their maximum tariffs. That poses a series of questions about consumers’ interests. Indeed, stakeholders such as Ofgem, the Government and Citizens Advice have warned that a relative cap would not prevent overcharging and might simply result in price increases for the best-value tariffs. There is widespread agreement that an absolute cap is the best option if overcharging is to be prevented. Moreover, a relative cap might decrease the number of people switching providers or tariffs, which would clearly not be in the interests of consumers.

We need to know more details of the criteria that Ofgem must follow when conducting its review of competition for domestic supply contracts under clause 7. Those criteria are set out in amendment 8. It is essential that the Minister and Ofgem are as transparent as possible when setting the targets, so that the price cap does what it says on the tin. The hon. Member for Wells (James Heappey) spoke about time of use tariffs. I am extremely suspicious of those, because they will inevitably penalise families with children, who have little flexibility when it comes to controlling when they use their energy. I do not think any of us want that.

Funding Higher Education

Andrew Lewer Excerpts

Wednesday 28th February 2018 Westminster Hall

[Andrew Lewer (Northampton South) (Con)]

It is a pleasure to serve under your chairmanship, Mr Hosie, particularly as you have experience and this is my first experience of speaking in a Westminster Hall debate. I hope you will be tolerant with me. I thank my hon. Friend the Member for South West Devon (Mr Streeter) for his excellent opening speech and the points that he made. Of his three points I wrote down the one about the 6.1% interest rate, which is almost unarguably a good point. I suppose his idea about the monthly repayments being tax deductible would be a “Yes, Minister” brave suggestion. On the concept of a graduate contribution, I think it may have been better if the present system has been not only set up slightly differently, but described differently at the time it was set up, taking into account the points that both my hon. Friend and the Minister have made about its true nature.

I welcome the fact that the Prime Minister’s speech on education and today’s debate have opened up an opportunity to discuss the reforms that we need to pursue in the funding of higher education. It is often the case, and I think it is here, that the obvious solutions are not necessarily the best. Revising education options for those over the age of 18 is, however, a welcome initiative. As a former member of the European Parliament, I was the lead member for the European Conservative and Reformists group on the Committee on Culture and Education, and therefore had a lot to do with Erasmus, Horizon 2020 and so on. We have as much to learn from other European countries as we have to teach them in showing them innovative ways of working.

I have been a governor of the University of Derby for the past eight years, so I try to keep up to date with the challenges of higher education. The point about vice-chancellors’ salaries is particularly relevant. In many cases, the solution is robust internal governance on the part of governing bodies at universities. I am pleased to say that the system at Derby is robust, but elsewhere there can sometimes be a culture of embarrassment, and of deferring to the vice-chancellor and senior executive members of the university. There can also be a concept that a governor ought to be a cheerleader for the university, rather than providing challenge and pushing back at some of the ideas of those in executive positions. That is not necessarily a call for more rules about governance; it is more a cultural point. It is for the universities to make sure that their governors are providing challenge, and are not just there to say, “You’re doing a great job; keep it up,” even if they are doing that, as is often the case.

Lowering tuition fees for higher education to, say, £6,000 may seem like a good idea in theory, but in practice it may, slightly counterintuitively, benefit only wealthier graduates. Even with that reduction, the tuition fee would remain hefty, and it would become easier for higher-income students to pay it off altogether, while lower-income graduates would still end up potentially with 30 years’ worth of debt to pay. Moreover, the immediate income of universities from the loan repayments of higher-income students would decrease. Smaller, more modern universities, such as the University of Northampton in my constituency and the University of Derby, would be affected the most, because they rely on tuition fees to survive more than the elite, more market-manageable, more international universities with various external sources of funding. Furthermore, it is newer universities that tend to recruit a high proportion of their students and graduates from lower-income families.

The problem, however, is not without a range of solutions, one of which could be the reintroduction of some kind of maintenance grant for disadvantaged students. Although cutting fees may not lead to financial support for those who need it the most, grants would be targeted specifically towards lower-income students. We also need other solutions as part of a toolkit. The format of today’s debate is useful in that respect, because we are not just standing up and saying, “This is the solution to the issue,” which would not be the right approach.

One solution might be to encourage private investment, and partnering up with private sector institutions. High-quality education leads to skills that are good for business. Revising skills and education, and adapting that to economic needs, as has been touched upon, could lead to new sources of funding in the form of grants from the private sector to university students and institutions, and to even more private investment in research—an area in which UK universities are very much world-leaders.

Only a few months ago, in November, the University of Northampton was one of six universities that contributed to an independent review of social impact investment in the UK made by the Treasury, showing that they are very much up to speed with what is going on in the sector. Part of that involves catching the eye of companies for financial partnerships. The university is moving from the constituency of my neighbour, my hon. Friend the Member for Northampton North (Michael Ellis), to an exciting new campus in my constituency of Northampton South, which is leading regeneration. Universities have a key role in that in obvious ways, such as buildings and the presence of the students, and in less obvious ways, such as changing and mixing up the culture of a neighbourhood. That brings potential problems, but if managed correctly it can bring significant benefits.

Another aspect that needs to be considered is that, although graduates can officially leave university with debts of £50,000, as my hon. Friend the Member for South West Devon began by saying—that sum of money is a key point in the debate—many never repay those sums, owing to the nature of the loan agreements, as they do not reach a certain level of income. The level of graduate contributions thus depends on the salary level that the students get after leaving university, which in turns depends partially on the skills and education that they received. However, the fact that that huge burden of debt is not, in many senses, actually there is lost on people due to the way in which the system is set up, expressed, and currently administered. There is scope in the reforms that have been put forward and the review that has been announced to look at the system not just presentationally, but in terms of how it operates.

Investing in universities is a healthy approach to getting funds into the institutions and providing opportunities for low-income students to study. The University of Derby has invested £120 million in facilities over the past five years, and graduate outcomes have improved markedly as a result, which is really the point of all such investments. Some 74.1% of students are in graduate-level roles within six months. We all know that education is the foundation of a good, productive economy and a rich, diverse society. It will always remain a top priority for the Government, and it should not be overlooked by today’s innovators and entrepreneurs, who will be the beneficiaries of it as well.

We have a terrific university sector in the UK. It is the envy of the rest of Europe and attracts huge numbers of international students. Despite changes that have taken place, which have been referred to, those numbers are still very strong. Our changes need to be forward-looking and build on that success. Although I am a great lover of nostalgia, I do not think that solutions should hark back to what was a much more elite and restricted past in the university sector.

--- Later in debate ---

[Paul Blomfield]

I agree with my hon. Friend. In his introductory remarks, the hon. Member for South West Devon rightly said that when the new system was introduced in 2012, there was an expectation of a variety of fee options. I shared his scepticism at that time. There was a thinking in Government that the £6,000 to £9,000 range would mean that Oxbridge, obviously, would charge £9,000, and everybody else would neatly rank themselves in accordance with the Government’s perception of quality. Those of us who had a relationship with the sector knew that that was not viable, because it costs as much to provide a degree in Plymouth as it does in Russell Group universities. So what happened was not surprising.

Although the review should focus on value for money, as the hon. Gentleman said, we need to be careful not to reduce higher education to a crude transactional relationship. There is an element within the teaching excellence framework that does that.

I was on the Higher Education and Research Public Bill Committee. Those of us on this side of the House supported the principle of focusing on teaching quality, but were worried that some of the metrics drove the debate in the wrong direction. We are pleased that the Government moved more towards a qualitative evaluation, rather than the simple crude quantitative measures they were initially looking at, but there is still an aspect of the debate that says we should be measuring quality by crude and easily measurable standards. We might take contact hours, for example. If we are going to measure by contact hours, Oxford would be bottom of the table. Nobody would argue that Oxford is the worst university in the country, but that illustrates the danger of crude metrics.

[Andrew Lewer]

Although crude metrics are not helpful, would the hon. Gentleman accept that having some metrics, such as the teaching excellence framework, is helpful?

[Paul Blomfield]

The hon. Gentleman is right. As I said, those of us on this side of the House who were on the Bill Committee, such as my hon. Friend the Member for City of Durham (Dr Blackman-Woods), argued that a focus on teaching quality was right, but we needed to get the way that we measured that experience right.

The other metric that is problematic is employment outcomes. The current Minister’s predecessor, the hon. Member for Orpington (Joseph Johnson), acknowledged that they were crude and, in a sense, unreliable metrics, but they were being used because they were the numbers that were available. I pointed out to the Minister at the time that there is not necessarily a relationship between teaching quality and employment outcomes. If a student had been to Eton and Oxford, like he had, and were from the right family and knew the right people, that person’s employment outcome was likely to be fairly good, irrespective of teaching quality. So when looking at the funding review, my warning is that we should make sure that we look at the educational experience of universities in the round. We argued that there should have been a statement in the Higher Education and Research Act 2017 about what universities were for.

Oral Answers to Questions

Andrew Lewer Excerpts

Tuesday 7th November 2017 Commons Chamber

[Matt Warman (Boston and Skegness) (Con)]

1. What steps he has taken to support the development of electric and autonomous vehicles.

[Andrew Lewer (Northampton South) (Con)]

6. What steps he is taking to support businesses that are developing connected and autonomous vehicles through the Midlands Engine.

[The Secretary of State for Business, Energy and Industrial Strategy (Greg Clark)]

Our industrial strategy capitalises on our strengths as we build the next generation of motor vehicles. In July, we committed £246 million to the Faraday Battery Challenge to make Britain a centre for the development of battery storage. I have also announced £51 million to fund automated vehicle testbeds across the country. I am delighted to say that in October Ford opened its new European Mobility headquarters in Britain.

--- Later in debate ---

[Andrew Lewer]

Silverstone Technology Cluster supports many thousands of jobs in and around Northamptonshire, including in companies such as Cosworth in my constituency of Northampton South. What steps are the Government taking to support the Silverstone cluster?

[Greg Clark]

My hon. Friend is absolutely right that the choice that some of the world’s best motor manufacturers make to locate in the cluster reinforces our reputation. Last year, we launched the Aylesbury Vale enterprise zone, which supports the Silverstone high-performance technology cluster. It provides an environment that is helping to deliver new jobs in this sector. The local growth fund for his area includes an innovation centre, which is geared to automotive technology in the enterprise zone.

Nuclear Safeguards Bill (First sitting)

Andrew Lewer Excerpts

Committee Debate: 1st sitting: House of Commons
Tuesday 31st October 2017 Public Bill Committees

[The Chair]

As a very tough Chairman, I am going to say that we are not allowed to discuss things that are not in the Bill; we can only discuss those things that are in the Bill. Therefore, no matter what your thoughts on that subject may be, I am very sorry, but you will have to raise them in another Bill Committee at some other time. I am sorry—I hope people do not mind—but we have got to keep to what is actually in the Bill itself.

[Andrew Lewer (Northampton South) (Con)]

Q Are there any other examples around the world of where national regulators are responsible for safeguarding in the way that this Bill proposes?

Dr Golshan: Numerous examples—a Canadian regulator, the US regulator, the Swiss regulator, and even though Finland is out of the European Union and part of the Euratom treaty, given that safeguarding is the responsibility of state, the Finnish regulator sees itself as being responsible for providing assurance to the state in that regard.

[Dr Whitehead]

Q You mentioned the different relationships that different countries have, both internationally and with Euratom. This Bill, as has already been set out on Second Reading, is very much a contingency Bill, in the event that—effectively—no other relationship with Euratom is possible after March 2019. How would you see a possible future relationship with Euratom that might assist in any way with lessening the burden that you clearly have on you at the moment to establish a completely new regime, and indeed a completely independent set of inspection and reporting arrangements? Should it be an association similar to that of Switzerland, or would you envisage something rather closer to Euratom for the future, if that can be achieved?

Dr Golshan: I think that is probably a question better answered by our legal colleagues, but that aside, I am aware that the Euratom treaty provides for associate memberships, either as a whole or in particular aspects, and that article 206 of the treaty in particular facilitates that. However, I am not an expert on that and I think it would be inappropriate to comment as to whether an association membership is possible or on how it would be possible.