Energy Prices
Debate between Jake Berry and Caroline Flint(9 years, 10 months ago)
Commons ChamberRead Full debate Read Hansard Text
Caroline Flint
Absolutely. People were told that technology—doing things online, for example—would always make things better, but that is not the case. The point applies to those who do not have the confidence to challenge and those with busy lives who just do not have the time. I seem to recall a previous Energy Minister admitting that he spent at least half a day trying to sort out his own energy bill. If he cannot do it, what hope is there for others?
Caroline Flint
No, I will not.
Let me get back to the issue of competitive pressures. As I said, competition in the energy market is at best immature and regulation on pricing is non-existent, which means that the normal competitive pressures that we would expect to restrain companies from increasing prices, or to encourage them to pass on falling costs, are weak, while regulation is unable to correct the situation. That is precisely the Catch-22 situation in which the Government have left consumers. The Government tell them that regulation is not needed because we have a competitive market, when all the evidence from the regulator, consumer groups and parts of the sector clearly shows that competition is not working as it should. We should not forget what consumers are saying. Research out from Which? today shows that complaints to the big six have hit a new record high, because the market is just not working for the public.
Today’s motion proposes a new back-stop power for the regulator to force companies to cut their prices when wholesale costs fall if companies do not do it first. I want to be clear about the nature and extent of the power. It is not a return to full-scale price regulation as existed in this country until 2002, including under Margaret Thatcher and John Major, or as it still exists in most member states of the European Union; it is a back-stop measure that empowers the regulator—not the Government, Ministers or anyone else—to ensure that all consumers can enjoy the full benefits of competition to which they are entitled.
If competition works and cost reductions are passed on, the power may never need to be used. Indeed, its very introduction may act as an incentive on companies to do the right thing. However, if in its view anti-competitive practices happen in our energy market that cause harm to consumers, the regulator should have the power not just to write to the companies to ask them politely to explain to their customers why they are being ripped off, but to do something about it.
That is what today’s motion proposes, and it is something that Members from both sides of the House can support. After all, what did the Prime Minister say before the last election? On 8 September 2009, on his Cameron Direct roadshow in Bedford, he said:
“I think we all feel that when the gas prices or the oil prices go up, they rush to pass the costs onto us and yet when we read in the papers that the oil price has collapsed and the gas prices are coming down, we wait for a very long time before we see anything coming through on our bills, and I think the first thing you’ve got to do...is give the regulator the teeth to order that those reductions are made and that is what we would do.”
I agree. Let me be direct: it is just a shame that, four years into this Parliament, that commitment has gone unfulfilled.
I tell the House today that if we are elected, alongside our price freeze and our market reforms, we will give the regulator that power. However, it would be far better for the Government to take action now rather than consumers having to wait another 11 months to see the benefit of falling wholesale prices. If the Government do, I guarantee them our support. Given the Queen’s Speech, if there is the will, time could be found. In that spirit, I commend this motion to the House.