Energy Supply Market: Small Businesses

Debate between Dominic Raab and Kevin Foster

Wednesday 13th September 2023 Westminster Hall

[Kevin Foster (Torbay) (Con)]

It is a pleasure to serve under your chairmanship, Ms Fovargue, and an equal pleasure to congratulate my hon. Friend the Member for Aberconwy (Robin Millar) on securing the debate. My constituency, like his, is reliant on and very much defined by the tourism sector.

Tourism is an iconic part of Torbay’s economy; we are called the English riviera for a reason. It is certainly safe to say that the services that the hundreds of tourism businesses in my constituency provide to the tens of thousands of visitors we get every year are much better than those provided in the comedy series “Fawlty Towers” by our most iconic hotelier, Basil Fawlty. He is based on a real person, but some aspects of the real individual were not included in the character because they would have been too ridiculous even for a comedy. It is safe to say that the hotels, guesthouses and attractions of Torbay offer a much better service than the one that those who had to endure Mr Fawlty got.

Earlier this year, it was useful to work with the team at the English Riviera BID Company, which is the champion of the tourism sector in Torbay, on conducting a survey of businesses’ energy costs. Unsurprisingly, the vast majority of responses were from the hospitality and tourism sectors. It is worth saying that there are bigger businesses in the sector: of the 60 replies I received, seven were from companies that turned over more than £1 million. Some of our biggest hotels, which are a key part of how tourism operates in the bay, have experienced big challenges. However, half the responses were from those under the VAT threshold, because there are many family businesses in Torbay. Perhaps we could have a separate debate on the impact of that threshold on the growth of family businesses.

It was particularly interesting to see the range of energy prices that were being paid. The lowest price was about 19p per kWh; the highest was 76.3p per kWh. That is a massive difference between businesses in the same sector, which was mostly driven by when they signed their energy contracts. It will be no surprise to hon. Members to hear that those who had to sign a new deal in the latter part of last year were paying the highest fees, with the majority paying between 30p and 50p per kWh for electricity.

Many respondents said that their monthly energy bill was double or more than double their previous energy contract. Nine respondents experienced an increase of more than 200%. That is pretty eye-watering, but the respondent with the biggest jump in their bill had an increase of 567%: their bill went from £60 a month to £400 a month, placing quite a burden on a small business.

Some said that they found it quite difficult when they came to the end of their contract. As my hon. Friend the Member for Aberconwy recalled, many were presented with a “take it or leave it” outcome. A range of complaints were made about brokers and some of their behaviours; some people felt that they had to pay up front, and others found that they literally could not get hold of them. One had their broker go out of business in the process of their trying to renew the energy contract, and some cited some fairly underhand tactics. One said that they did not particularly want to extend the contract—certainly not for the whole period suggested—and then found their voice notes being used to claim that they had signed an agreement for three years.

There are some sharp practices, on top of the obvious impacts. For some hotels and businesses, it sounded similar to the challenges they faced with banks during the financial crisis, when they suddenly had to refinance or take out swap products that they did not want or need, but the only alternative in the middle of a credit crunch was to find multimillion-pound financing deals literally overnight. Some businesses say that exactly the same tactics are being used now. Brokers knew these were distressed purchases, so they exploited them rather than working with customers.

It is not all negative. Some cited being offered things like blend and extend, which in one case cut a gas rate from 23p per kWh to 8p per kWh. Some providers are making a difference, but it is clear that far too many are not. These costs just cannot be easily absorbed. Yes, consumer prices can be put up, but that will inevitably have an impact on the number of people who can take a holiday or use a business, particularly given the wider issues in the economy.

From the survey, the question that occurred to me—I am particularly interested to hear the Minister’s thoughts on this—was what thought is being given to extending access to the energy ombudsman. As has been touched on, although many of the businesses are commercial customers, they are not far off being a family looking to buy energy. Some businesses will also be the family home—for instance, a guesthouse that doubles up as the family home. They are not complex corporate organisations that can avail themselves of a wide range of advice when signing up for a deal. What thought is being given to the regulation of brokers? We have already heard examples of sharp practice, and that certainly came up in my survey.

I join the hon. Member for Bath (Wera Hobhouse) in her comments about finally breaking the link between gas and the electricity price. More types of generation, both renewable and, in the very foreseeable future, major non-gas generation—that is, nuclear power at places such as Hinkley Point C—will make the specific link between gas and the electricity price increasingly irrelevant and outdated. It would be interesting to hear the Minister’s thoughts on that.

This has been a useful opportunity to outline some of the impacts on businesses in Torbay.

[Dominic Raab (Esher and Walton) (Con)]

My hon. Friend is making an excellent speech. Hon. Members have suggested a range of options, including reducing the energy price for small businesses, but in my constituency I have found that SMEs in particular have looked to turn from being consumers to becoming suppliers by installing renewable sources, for example solar panels. Those would not just reduce bills, but provide extra supplementary support for the local grid. Esher Theatre is just one example in my constituency. Does my hon. Friend agree that as well as support with bills, that kind of transitional support, particularly given the high capital costs involved, would go a long way?

[Kevin Foster]

I could not agree more. My right hon. Friend is absolutely right to say that for some businesses there is an option not only to be a consumer of electricity but to become a generator. One business that responded to my survey said that it wanted to look at solar, but it got turned down for planning permission by the then Lib Dem-independent coalition-run council. Some businesses say that there is therefore a need to look at planning rules and the balance there.

No one is going to argue that a listed heritage building should suddenly have something inappropriate added to it, for example, but we need to think about how we can make it a practical proposition for companies to mitigate the impact on their own bills by generating from their own buildings where possible. Solar power is the obvious option that some people will reach for but, given how diverse this area is, there will potentially be other opportunities for generating their own renewable power and having support to do so. I fully agree with my right hon. Friend’s excellent suggestion.

Tourism is an iconic industry for Torbay. The summer months have shown us some of the challenges facing the leisure industry. I am really keen to ensure that people who had to sign fixed-deal contracts at a time when the market was at its highest are not now unduly penalised, particularly given some of the sharp practices in the sector. That must not become a reason for those who are locked into high energy costs to have to switch the lights out on their business.

Independent Public Advocate

Debate between Dominic Raab and Kevin Foster

Wednesday 1st March 2023 Commons Chamber

[Dominic Raab]

To be clear, on the right of initiative, which I know the right hon. Member for Garston and Halewood (Maria Eagle) has raised and included in her Bill, there could be different views as to its shape or scope, so that is something the Government will ultimately have the last word on. Frankly, what the hon. Gentleman said about the IPA not being independent is wholly wrong. We ought to be clear that, from the point of establishment in relation to a tragedy, the IPA will be wholly and entirely independent to serve the victims, the bereaved and the survivors, and only them. I could not be clearer on the subject.

[Kevin Foster (Torbay) (Con)]

A lot of the statement is welcome and will hopefully rebalance the position for families and victims, not least since they have had the unedifying experience of facing phalanxes of lawyers, knowing they were being paid for by their own taxes and by public funds to sometimes cover up the impact on their relatives. However, I do not find myself particularly persuaded on the points made by the Secretary of State around the compulsion of evidence, which strikes me as something that needs to be part of this. In his preparation work, which he referred to, what timeline has he set for this institution being up and ready, pending the legislation coming through the House?

[Dominic Raab]

My hon. Friend makes a good point. The policy work is quite far developed, but of course we have not foreclosed options so that we can have maximum transparency and proper engagement. I will need to identify the right legislative vehicle and it will then take as long as the House takes to enact it, but I hope to say more on the legislative vehicle shortly.

Oral Answers to Questions

Debate between Dominic Raab and Kevin Foster

Tuesday 22nd November 2022 Commons Chamber

[Dominic Raab]

The hon. Gentleman knows that I cannot comment on individual judicial cases, but I understand the concern in such cases. Of course, if he wishes to write to me with the details, I will be happy to look at that very carefully.

[Kevin Foster (Torbay) (Con)]

Two of my constituents who were subjected to a vicious, unprovoked knife attack, as well as many others in the bay, felt let down by the justice system due to the level of sentence that was applied. They continue to feel let down by not getting information about someone who was connected with that series of offences. Will my right hon. Friend, or the relevant victims Minister, meet me to discuss that case and what we can do about it?

[Dominic Raab]

I will certainly ensure that my hon. Friend gets a meeting with the victims Minister, my right hon. Friend the Member for Charnwood (Edward Argar). I will not comment on individual cases, but we have increased sentencing substantially through the Police, Crime, Sentencing and Courts Act 2022, against which Opposition Members voted. In individual cases, however, it is of course for the judiciary to decide and that discretion is important.

Oral Answers to Questions

Debate between Dominic Raab and Kevin Foster

Wednesday 16th November 2022 Commons Chamber

[The Deputy Prime Minister]

We are very sympathetic to the challenges that all our schools face. More will be said about specific measures tomorrow, but the hon. Lady should stand assured that we are the top spenders as a percentage of GDP on primary and secondary education in the G7, and that standards, which matter to pupils and parents the most, have increased, with the proportion of schools rated good or outstanding up from 68% in 2010 to 87% today.

[Kevin Foster (Torbay) (Con)]

Q11. The Deputy Prime Minister will be aware of the opportunities but also the challenges that face Torbay’s tourism and hospitality sector, including increased energy costs and the impact of business rates. What consideration is he giving to the situation of Torbay’s iconic industry and further measures to support it?

[The Deputy Prime Minister]

My hon. Friend is a fantastic champion for Torbay. The Chancellor will make a statement tomorrow and I cannot speculate on the spending decisions, but my hon. Friend will have noticed already the tourism recovery plan, which will help recovery from the pandemic and is also part of the wider levelling-up agenda.

Oral Answers to Questions

Debate between Dominic Raab and Kevin Foster

Thursday 25th October 2018 Commons Chamber

[Dominic Raab]

There has actually been a variety of legislation, including the European Union (Withdrawal) Act 2018, which is now in place. The irresponsible thing to do is take the position of the shadow Chancellor, who has said that he would make no financial provision for no deal. That is deeply irresponsible, as it would leave us as a hostage to the negotiations and leave the UK overexposed in the unlikely and regrettable outcome that we do not get a deal with our EU partners.

[Kevin Foster (Torbay) (Con)]

T4. Torbay’s language colleges are delighted to welcome thousands of students from across Europe each year to enjoy the beautiful bay and to learn English. Will the Minister outline how the needs of that sector have been considered in our negotiations with the EU?

EU Exit Negotiations

Debate between Dominic Raab and Kevin Foster

Tuesday 9th October 2018 Commons Chamber

[Dominic Raab]

I thank the hon. Lady for her very important question. The timeframe for scrutiny in this House and the other place is also very important. After the agreement has been reached in all the areas she describes, we will have a period where the documents are laid and a meaningful vote. After that, the legislation implementing the withdrawal agreement would be introduced.

[Kevin Foster (Torbay) (Con)]

I refer the House to my entry in the Register of Members’ Financial Interests. There has rightly been a lot of focus on one of the land borders affected by the UK leaving the EU, but so far no questions about the second one—the one between Spain and Gibraltar. Will the Secretary of State outline how he is keeping in contact with the Government of Gibraltar on the process of negotiations and ensuring that their views are fully taken on board?

[Dominic Raab]

My hon. Friend is right. I met the Chief Minister recently. We are making sure that the Government of Gibraltar are fully involved and fully aware of all the negotiations. We have made good progress together in Madrid. The Under-Secretary of State for Exiting the European Union, my hon. Friend the Member for Worcester (Mr Walker), will be seeing him again next week.

EU Withdrawal Agreement: Legislation

Debate between Dominic Raab and Kevin Foster

Tuesday 24th July 2018 Commons Chamber

[Dominic Raab]

The terms of the meaningful vote have already been set out in the European Union (Withdrawal) Act, and the vote will be to approve or reject the full deal, including both the withdrawal agreement and the future framework.

[Kevin Foster (Torbay) (Con)]

rose—

--- Later in debate ---

[Kevin Foster]

Thank you, Mr Speaker. You are a star, and I am sure you know how to do your scone correctly, too.

The Secretary of State will be aware of the importance of the fishing industry to Torbay and across the south-west. Can he therefore confirm that, by 2020, the UK will be negotiating its own fishing policies as an independent coastal state?

[Dominic Raab]

My hon. Friend is absolutely right. In 2020 we will be negotiating fishing opportunities as an independent coastal state, deciding who can access our waters and, more importantly, on what terms.

Oral Answers to Questions

Debate between Dominic Raab and Kevin Foster

Monday 30th April 2018 Commons Chamber

[Dominic Raab]

I thank my hon. Friend for that. She is absolutely right: where local authorities have the ambition to get homes built, it is right that they get support from central Government infrastructure funding, so that we do not just build the homes that our country needs but build up stronger local communities with them.

[Kevin Foster (Torbay) (Con)]

12. If he will make an assessment of the effectiveness of steps to reduce street homelessness in Torbay.

Grenfell Tower

Debate between Dominic Raab and Kevin Foster

Monday 5th February 2018 Commons Chamber

[Dominic Raab]

The right hon. Gentleman has raised a number of points. First, he talked about cladding that might be unsafe. He did not specify which, but any concerns can be sent to the Building Research Establishment for sampling. We can get that checked in the right way.

In relation to the issue between freeholders and leaseholders, we have been clear all along that it is for the owner of the property to conduct the required renovation and to bear the cost. On local authorities, wherever financial flexibility is required, they can come to us. We have not said no to one yet. Housing associations should go to the regulator. In relation to private sector landlords, we have made it very clear that we believe they should bear the cost. It will depend on the specific leases, and of course the legal question of whether costs are being unreasonably handed over to tenants can be determined by the first-tier tribunal. That is a legal issue and we cannot interfere in that, but morally, we know that there are plenty of freeholders in the private sector who should be doing just as local authorities and housing associations are doing, and who should not be passing on any unreasonable cost to leaseholders or tenants.

[Kevin Foster (Torbay) (Con)]

It is interesting to contrast some of the comments made at the Opposition Dispatch Box today with the reactions of that individual to previous issues when he was a Minister. Will the Minister tell me what is being done to ensure that social housing tenants will be listened to in future? That is one of the big things that has come out of this. People put forward their concerns, but they were just not listened to, even by those who were supposed to be representing them.

[Dominic Raab]

My hon. Friend makes a broader point. We have two important streams of work under way to ensure that lessons are learned. The first relates to building regulations. We have had the interim report from the Hackitt review and we look forward to the full report. We are also conducting a series of workshops for social housing tenants across the country. We have held something like 100 events, and I have attended two of them, in Basingstoke and in relation to Grenfell. That is the right way to proceed. We must ensure that we listen to social tenants with an open mind and an open heart, and that we learn the lessons as we take forward our reform proposals.

Oral Answers to Questions

Debate between Dominic Raab and Kevin Foster

Tuesday 26th April 2016 Commons Chamber

[Mr Raab]

The Government led the world on human rights before the Human Rights Act and will do so afterwards.

[Kevin Foster (Torbay) (Con)]

T5. Too many prisoners enter and leave prison without qualifications. Does my right hon. Friend agree that it is vital that prisoners get recognised qualifications in prison, so that they can have a second chance and a second career when they leave jail?

Oral Answers to Questions

Debate between Dominic Raab and Kevin Foster

Tuesday 8th September 2015 Commons Chamber

[Mr Raab]

We are very mindful of the issues relating to a Bill of Rights in Northern Ireland. We will be consulting widely, including with Northern Ireland politicians, and will be very sensitive to ensure that we do nothing that would have a disruptive effect in the region.

[Kevin Foster (Torbay) (Con)]

3. What assessment he has made of the effect of the closure of Torquay magistrates court on witnesses and other court users.