Energy Prices

Gemma Doyle Excerpts

Wednesday 18th June 2014 Commons Chamber

[Gemma Doyle (West Dunbartonshire) (Lab/Co-op)]

I am grateful to my hon. Friend the Member for Linlithgow and East Falkirk (Michael Connarty) for my six-minute rather than seven-minute speech!

The rise in energy prices is having a real impact on the financial stability and quality of life of people right across the UK. I say to the hon. Member for Daventry (Chris Heaton-Harris) that it is ludicrous to suggest that there was no concern about this matter under the previous Government. Some of what he said was hysterical hyperbole, which is not welcome in this debate. What we are talking about is a cost of living crisis that is happening now, not four years ago, which is why we are proposing a range of measures today.

We know that the cost of wholesale energy has fallen, yet consumers are still paying more than they should. That is of particular concern to my constituents, because, despite the unusual and lovely weather at home at the moment, it is not always warm in West Dunbartonshire, and people have to spend a higher percentage of their income on heating their homes. I am not talking about luxury. West Dunbartonshire has a high proportion of elderly people and people with long-term and chronic conditions. Keeping warm is about not just keeping well but, in some cases, keeping alive.

It is worth pointing out that when we talk about the varying costs of living across the UK, we often focus on the high costs of housing in London, but for those of us who represent constituencies with much cooler climates, the higher costs that people have to spend on heating their homes are also a big issue, especially when we consider things such as the rates of the living wage.

Wholesale gas prices have fallen by 38% and electricity prices by 25%, yet last year energy companies raised their prices by 10%. We may have seen some commitment from a few energy companies to freeze their costs this year, but we should not be tricked into thinking that they are doing us a favour. If the cost of wholesale energy comes down, then so, too, should the bills of our constituents.

I am sure I am not alone in saying that I am frequently contacted by constituents overwhelmed by the cost of heating their homes, or confused by the complex regulation and delivery of their energy supply. It is clear that we need to reform the energy market. Turning on heating is not a luxury. I am not talking about fanciful spending. I urge the Secretary of State to reflect on the statistics. Earlier this month, the annual fuel poverty statistics projected that there would soon be 2.33 million households in fuel poverty in the UK, the main factor being the increasing cost of energy.

Last year, UK households spent an enormous £19.5 billion more on energy than they did a decade ago, an increase of 131%. Those are big figures, but what do they mean? Last year, real-terms average earnings slipped back to the levels of the decade before, which meant that people were—and still are—attempting to pay bills that are far above what they had been paying 10 years before, but were doing so with the same amount of money.

Around 100,000 people in Scotland, and 30% of households in my constituency, are living in fuel poverty. My constituents are already suffering from the Government’s austerity package, and energy is one area in which the Government, if they were serious, could take real action. Life is hard enough without energy companies focusing on their profits rather than on how to get energy prices down for their consumers. The energy market is suffering from a lack of competition, which allows suppliers to get away with it.

I hear what the Secretary of State says about switching, which is important, but I want all my constituents to pay less for their energy—not just those who switch and get a better deal. I would rather we focused on how to do that, rather than producing even more complicated information for people. Poor practice, bordering on immoral behaviour, has now become commonplace. The big six have incurred financial penalties totalling about £40 million, but that is small change for an industry with profits closer to £4 billion. We need to take action and I fully support the motion. I hope that the Government see sense and do the same.