Oral Answers to Questions

Debate between Charles Hendry and William Bain

Thursday 10th February 2011 Commons Chamber

[Charles Hendry]

My hon. Friend raises a very important point, which I hope she will pursue through Ofgem as well. The costs of those mechanisms are calculated by the local area network using a methodology agreed by Ofgem, which means that it can recover only reasonable costs associated with the connection work. If the complaints procedure has been exhausted, Ofgem can then determine whether the costs are reasonable. Consumers can also consider using an independent connection provider that might be able to offer a better deal.

[Mr William Bain (Glasgow North East) (Lab)]

17. What recent discussions he has had with energy companies on tariff and pricing policies affecting consumers.

[The Minister of State, Department of Energy and Climate Change (Charles Hendry)]

Ministers and officials in the Department of Energy and Climate Change meet Ofgem and suppliers on a regular basis to discuss market issues. Ofgem monitors the market closely and reports quarterly on retail prices. Its latest report shows large increases in estimated supplier margins for the year ahead, largely owing to recent price increases. We are disappointed on behalf of consumers by this development, and welcome the announcement of Ofgem’s review of the retail market.

[Mr Bain]

The Minister will be aware from a written answer to me on 10 January that without further Government action, by 2013 the impact of the Government’s proposed electricity market reforms will be felt by the poorest 10% of households three times more heavily than by the richest 10%. Will he therefore adopt Save the Children’s excellent idea of obliging the energy companies to offer a compulsory rebate to the poorest families?

[Charles Hendry]

We have indeed introduced a new obligation for energy companies to help the most disadvantaged people. We are determined to take forward that agenda, and to ensure that we do it rather more effectively than it has been done in the past. We also have to ensure that we secure the investment necessary to rebuild our energy infrastructure, which was badly put off under the previous Administration.