Equitable Life Policyholders: Compensation

Debate between Jim Shannon and Mike Weir

Thursday 23rd March 2017 Commons Chamber

[Mike Weir]

Indeed it is. That is the point that I was making.

Some of us are now getting to the age at which we are beginning to think seriously about what our pensions will bring us—it is going to hit us pretty shortly—but I have children who are in their 20s, and this is a very long-term investment for people in their 20s and 30s. Young people today who look at the WASPI women or at Equitable Life pensioners will not have the same confidence that people of my generation might have had that they are putting aside savings to augment their state pension. The state pension is changing, and we are looking at different ways in which people will invest for the future, such as auto-enrolment. All these things require confidence, but that confidence has been undermined by continuing scandals such as Equitable Life.

The Government have to look at the bigger picture, rather than simply looking at Equitable Life in isolation. They have to look at how we can get over this hump and ensure that all young people make provision for the future. If we do not do that, a much bigger problem will be coming over the horizon when those young people get older, having made no provision because they lacked confidence in the system. What are we going to do then? The fall-backs that exist today will no longer be there for them. I urge the Minister, even at this late stage, to go back to the Chancellor and say, “Look at the bigger picture. Look at how we are dealing with pensions. How can we get confidence back?” If we do not do this, the picture will get even worse later.

[Jim Shannon]

The hon. Gentleman reminds me of a point I should have made earlier. It is recognised that parents often need to make financial provision for their children, and that we are using some of the money that we have to make that happen, yet some Equitable Life policyholders have told me that they are unable to do that. Has the hon. Gentleman come across similar cases?

[Mike Weir]

I have a daughter who is now into her third university degree, so I know exactly what the hon. Gentleman is talking about. Yes, parents are having to use their own money to help out their children, and that can cut down the amount that will be available to them in the future. That is a decision that they have to make, however; it is a slightly different issue. The bigger issue is the future. Many young people today are not earning enough money, and many have been landed with large debts following their university degrees. That, and the lack of confidence in the system, will have an impact on their ability to save for a pension. I think I have gone on long enough now, so I will end on that point.

Food Banks

Debate between Jim Shannon and Mike Weir

Wednesday 17th December 2014 Commons Chamber

[Mr Mike Weir (Angus) (SNP)]

Everybody should agree that it is an absolute and utter disgrace, in a rich, developed nation of the 21st century, that so many of our fellow citizens have to resort to food banks. The largest food bank in my constituency is the Angus food bank, which is run by a group of churches, supported by the Trussell Trust. I have joined food collections, and the dedication of volunteers and the generosity of those who donate never ceases to amaze me.

It is often those who have little enough themselves who are most ready to help their fellow citizens. I recall that at a recent event, one person came up to us with a small donation, saying that he could not afford much but had been helped by the food bank when he was in need and wanted to give something back. That is far from unusual. Food banks bring out the best in ordinary people with a desire to help those who find themselves in temporary difficulties through illness, unemployment or other factors. Unfortunately, they do not seem to have that effect on Ministers.

The rise in food bank use is down to rising need, and the number of people using them is certainly going up. In Scotland alone, 51,647 people received a minimum three-day supply of food from a Trussell Trust food bank in the six months to September this year, an increase of an astonishing 124% on the same period last year. Almost one third of those helped were children. The Trussell Trust expects that over the full year, the number will rise to more than 90,000. Angus food bank helped 1,247 people in the six months to April, and it does not cover the major town of Arbroath, which is served by other food banks. Some 277 of those people were children. In the council ward where I live, 338 people were helped. Those figures are shocking.

Why do people go to food banks? The Trussell Trust says that only 5% of people who come to it cite homelessness as the main cause of their crisis. Almost half—46%—cite benefit problems, and a further 18% cite low income.

[Jim Shannon]

(Strangford) (DUP): The Trussell Trust food bank in Newtonards, in my constituency, was the first in Northern Ireland. It is run by the Thriving Life church and does excellent work. I am the main referral agency for it, and for the record, the main reasons for referrals are benefit delays at 30%, benefit changes at 15% and low income at 22%. Last year—

Fishing Industry

Debate between Jim Shannon and Mike Weir

Thursday 12th December 2013 Commons Chamber

[Jim Shannon (Strangford) (DUP)]

I congratulate the hon. Member for Aberdeen North (Mr Doran) on setting the scene for this important debate. One thinks of the film “Groundhog Day”, as the debate happens every year and we always seem to come back to it. However, it does not make the debate any less important, as we can see from the Members who are here to make a contribution.

As I have said many times before in this Chamber, fishing is the lifeblood of the village of Portavogie in my constituency, which has both primary and secondary fishing jobs. It has been said in this debate that Northern Ireland has 700 fishing jobs, but the offshore jobs—those involved in further processing—double that figure. It is clear, therefore, how important fishing is to my constituency and to the constituency of the hon. Member for South Down (Ms Ritchie).

Just last week, I, along with Diane Dodds MEP and Alan McCulla of the Anglo-North Irish Fish Producers Organisation, had the opportunity to meet the Minister and to put forward a case for Northern Ireland to set the scene early on. I pay tribute to the former Minister, the hon. Member for Newbury (Richard Benyon), who is not in his place, because he took the time to come to the Chamber for the start of the debate. We all recognise his interest and importance in this regard. Things have changed. The responsibility now falls on the shoulders of a new Minister, and I look forward to supporting him as he does his job. Let us make no mistake; there will be a big fight in Europe over this issue.

Members have referred to the number of deaths at sea. Every time I watch the film “Deadliest Catch”, I think of the fishermen from Portavogie who have such experiences every week. The other night, “Perfect Storm” was on TV. We all know that film, but for some of the families in Portavogie, they live that life. We have a memorial in the harbour to those who died doing their job.

I want to focus my remarks on Northern Ireland and the issues of nephrops and prawns. The scientific advice for nephrops was published on 31 October, but we have no indication of what is happening in relation to it. The nephrops industry is critical to the fishing sector in Northern Ireland. If area 7 is cancelled, nephrops will again be our No. 1 priority. I urge the Minister, as we did last week, to underline that important issue. The fishing stock in Northern Ireland could have 100 vessels specifically targeting that species.

In recent years, the UK and Ireland have successfully made the case that the total allowable catches must be uplifted above the “sum of the science” to account for consistent undershoots in the TAC caused by some member states not taking up their allocation of nephrops. I find those undershoots both worrying and annoying; they cause great concern to me and to the industry. Combined with the less favourable scientific advice, they will make achieving a roll-over in the TAC very challenging this year. It must be stressed that the catch landed is important for the fishermen of Northern Ireland and for the shore-based industry. Again, let us make no mistake: the issue is critical for the Northern Ireland fishing sector. Nephrops is Northern Ireland’s No.1 priority, and giving that stock such priority can be easily explained. It is practically the only major stock we have left. The fact remains that fisheries in the Irish sea have been managed into practically depending on this single species.

Europe, through its legislation, bureaucracy and strategies, has pushed the fishing industry towards the one sector of prawns. At a recent North-Western Waters Regional Advisory Council meeting in Paris, the International Council for the Exploration of the Seas agreed that stock was being managed within the maximum sustainable yield targets, which is good news.

The hon. Member for Banff and Buchan (Dr Whiteford) outlined the issue of North sea cod. The situation is similar for us in Northern Ireland. Our one remaining full-time whitefish trawler in the fleet mainly targets haddock, but a recovery plan is in place. The Northern Ireland fisheries division, through the Department for Agriculture and Rural Development, permitted a limited sentinel fishery for cod from 2 to 24 September. It observed the quantity of cod in the sea, and it showed that cod numbers and the size of cod are increasing, which is good news.

I am concerned that the European Commission has proposed a cut in the TAC of 20%, in line with the cod recovery plan. It is clear that we must argue for a simple roll-over in the TAC, but the Fisheries Minister is aware that that is a difficult argument to win, and a potential compromise would be to suggest a by-catch only fishery in 2014 if the Commission would agree to the TAC remaining unchanged. A reduced TAC combined with improved gear selectivity and the forthcoming discard ban will make it all the harder to determine what is happening with Irish sea cod. It should also be noted that any reduction in the TAC will stop the sentinel fishery, which is important and has been running for the past two years.

There are some good points to make about fisheries, which is good because the news is so bleak at this time of the year. The size of haddock and plaice has increased over the past year. The EC has also proposed a 5% increase in herring, which is good news. The industry is on track to secure the Marine Stewardship Council certification, which has been running over the past few years, and that will be a first for an Irish sea fish species.

I am really concerned that the number of days at sea will be reduced if cod stocks fail to recover. Our fishermen will have fewer days at sea, which is incredible and hard to understand.

[Mr Mike Weir (Angus) (SNP)]

Does the hon. Gentleman agree that if there is such a reduction, it would make it very difficult for many boats to have a sustainable future?

[Jim Shannon]

That is a valuable intervention, which outlines my case very clearly. If there is a reduction, the viability of many boats will come into question. Again, it will be yet another nudge in the direction of not fishing any more.

Other Members have mentioned mackerel, but I am concerned that Iceland and the Faroe Islands might have 12% of the total allowable catch, which is what the EU is moving towards. Thankfully, that has been blocked so far by Norway. It reminds me of a saying that we have in my country—that is, “No surrender.” Norway said “No surrender” to the Faroes and to Iceland. When quota is allocated, it is ridiculous to allocate a percentage when the stock reduces in size. We want to protect the UK allocation, as other hon. Members have said.

I am conscious of regionalisation. Others have mentioned it, but I want to see regionalisation that means that Northern Ireland has some control over the fisheries in the Irish sea. Other regions would like to see that, too. Northern Ireland secured an acceptable amount of money from the European fisheries fund budget and I believe that it can do likewise through the European maritime and fisheries fund.

I urge the Minister, when he goes to Brussels, to ensure that the one thing he keeps in his mind is the fishermen. They want the fish, they want to sustain their jobs and they want to sustain their families. I am aware that I have gone into some detail, but at the same time I tell the Minister that I have every confidence that he goes into battle well armed with knowledge and firm about what he wants to achieve. I ask the House to give him the support he needs to do the job we know he can do well. We wish him well in the next week or two as he fights those battles for Northern Ireland, Scotland, Wales and England.

Prepayment Meters

Debate between Jim Shannon and Mike Weir

Tuesday 11th June 2013 Westminster Hall

[Mr Mike Weir (Angus) (SNP)]

I am pleased to be able to appear under your chairmanship this afternoon, Mr Hollobone.

The debate came about because, on Report, I tabled amendments to the Energy Bill on the Government’s new proposals to help consumers with their energy bills. Unfortunately, my amendments were not discussed due to lack of time, but there are serious issues relating to the new powers and to prepayment meters in particular.

Under what was new clause 13, powers would be taken to allow the regulator to require

“licence holders to change the domestic tariffs or other terms of domestic supply contracts so as to reduce the costs to their domestic customers for supplies of gas or electricity.”

However, what was then subsection (3)(e) provides

“for requiring a licence holder to change the domestic tariff or other supply contract terms on which it supplies gas or electricity to a domestic customer by—

(i) switching to a different domestic tariff or different supply contract terms, unless the customer objects, or

(ii) offering the customer, or inviting the customer to switch to, a different domestic tariff or different supply contract terms.”

My problem is with sub-paragraph (ii).

I fully appreciate that the Minister may argue that consumers should be given the maximum amount of choice and should be empowered to make their own decisions, but the plain fact of the matter is that, as we all know and as is remarked on in the regulatory impact assessment of the Bill, there is a huge amount of inertia among energy consumers, in particular those who remained with their former monopoly supplier after privatisation. If the provision in the Bill remains as it is, there is a real danger that companies might take the second option and make an offer to the consumer. We are then faced with the issue of what form that offer might take.

We already receive a huge amount of paper from our energy providers. As well as bills, we get special offers and offers to take on maintenance of domestic appliances, drains, pipes, electrics and whatever else. We also get invitations to take up different ways to pay our bills, especially if the providers have not yet signed us up to a direct debit; once we have direct debits, they make regular attempts to increase the amount we are paying by direct debit—amounts that sometimes bear no relation to how much energy we actually use. Now, too, we get annual and regular energy statements. That is all useful, but how many of our constituents really take the time to go through that mountain of information, and how many just put it in the recycling bin with all the other junk mail?

The first option, however, is straightforward: if consumers are on a contract or supply terms that are not the best, they can be automatically transferred to a better deal, unless they make the specific decision not to do so. That seems to have a better chance of fulfilling the Prime Minister’s promise to ensure that every customer is on the lowest tariff. Of course, the situation would have to be monitored, to ensure that the energy company is indeed offering the lowest tariff, but that can be addressed by Ofgem and to an extent by the provisions of subsection (5) of what was the new clause. I am interested to hear what Ministers have to say about that point.

My other concern and the main point of today’s debate is how that relates specifically to some of the poorest in our society who have to rely on prepayment meters. If someone is on a direct debit tariff, that may be fine, but if they are on a prepayment meter, for example, they will still be stuck on a higher tariff, since those tariffs are generally higher than the ones that would be available to someone who is paying by direct debit. If the Government are truly intent on ensuring that everyone has the lowest possible bill, they need to ensure that the requirement not only applies within the type of contract that the customers already have, but allows them to move to a cheaper type of contract.

There are particular problems with prepayment meters. It has always seemed to be slightly perverse that this is one of the few examples in which consumers end up paying much more by paying cash in advance.

[Jim Shannon (Strangford) (DUP)]

I congratulate the hon. Gentleman on bringing this important matter before the House for consideration. I have been dealing with a number of constituents who have had similar problems with the tariffs for, for example, oil. Does he think that other options might be necessary, not only for oil but for gas, so that people can switch, whatever the fuel that provides their heating? If we do not enable that, fuel poverty will continue to grow.

[Mr Weir]

The hon. Gentleman makes a valid point. I have often talked about oil, though it might be outwith the terms of today’s debate, but I take his point, which is very true.

The issue of prepayment meters is important. Citizens Advice Scotland issued a report on energy recently, showing that citizens advice bureaux had dealt with 7,400 people with 9,500 different energy issues in 2011-12; of those, 83% related to difficulties with paying or debt. The report stated that

“the cases highlighted by bureaux regarding difficulty paying are most commonly with regards to prepayment meters recouping an unaffordable amount for arrears every time the consumer tops up.”

The problem with prepayment meters is not only that the tariff tends to be higher—to be fair, things are better than they used to be, and many companies now fix at the standard tariff, although this is higher than the tariffs that can be achieved on, for example, direct debit—but that many, though not all, of those on prepayment meters are put on them because they have a debt, and part of that debt is recouped every time the consumer tops up the meter. The costs of installation can also be added to the debt, meaning that consumers are pushed further into debt.

Meters tend to be used when a consumer is already struggling. The perverse effect is that if people are already struggling to keep up with payments on the cheapest tariff, such as an online one paid by direct debit, should they fall into difficulties—perhaps they lose their job or become ill, or for any of a vast number of reasons—they end up being put on an even more expensive tariff, which simply deepens their difficulties.

[Mr Weir]

The hon. Gentleman makes an excellent point, and I shall come on to discuss that issue shortly.

The report from the Scottish CAB cites the case of a single parent with two children who loses £7 towards arrears every time she puts £10 in the meter, and the £3 left is entirely insufficient to heat her home. What chance has she of ever getting out of the cycle of debt, or even of keeping her home warm?

When the debate was announced, Barnardo’s got in touch with me and mentioned the problem, expressing its concerns that the Government’s plans to simplify the charging system will still allow fuel companies to charge higher prices for those who pay for their electricity and gas through prepayment meters rather than through direct debit. Barnardo’s quoted research showing that vulnerable households in or on the margins of poverty are forced to pay through their energy bills an extra £1.1 billion a year above those on high incomes. A key reason for that is that such households often have to opt for a higher-cost payment method.

Interestingly, the energy companies often argue that the costs of providing and servicing prepayment meters are higher than for other payment methods, but Barnardo’s cites the example of what it refers to as the “reasonable cost” of the Northern Ireland keypad, which shows that prepayment meters do not necessarily have to involve a large premium. I am not familiar with the Northern Ireland system, but the Minister might want to investigate it.

[Jim Shannon]

Will the hon. Gentleman give way?

[Mr Weir]

We might get some information from the hon. Gentleman.

[Jim Shannon]

The hon. Gentleman and I discussed this matter before and, if anyone heard my phone going, that was a text coming through to confirm the issue: the administrative costs in Northern Ireland are less, which is why it is cheaper than on the mainland. If the keypad system in Northern Ireland can be cheaper, perhaps that needs to be looked at.

[Mr Weir]

I thank the hon. Gentleman for that clarification. Ofgem should certainly be looking at that matter, and perhaps the Minister will encourage it along that route.

Barnardo’s also makes the point that the reason that many people use such meters is that they do not have access to a bank account to take advantage of direct debit payment. That is undeniably true, but it is also true that it is almost impossible for many people in such situations to get a bank account, since, frankly, the main banks are not interested, and many of them now seem to be moving to charging for current accounts, which is hardly likely to help. Barnardo’s calls upon the Government to extend the Post Office card account to allow payment of bills by direct debit, which I understand was promised in the coalition agreement. I appreciate that this may be outwith the Minister’s remit today, but that could be considered when introducing the universal credit.

Prepayment meters also have the problem of self-disconnection, as the hon. Member for Arfon (Hywel Williams) said. If people cannot afford to heat their homes, they simply do not put money in the meter. There is no active disconnection by the energy company, but the end effect is the same. That applies not just in Scotland but throughout the UK. The hon. Gentleman raised the issue in relation to Wales, but Stratford-on-Avon and district citizens advice bureau has contacted me about it. It takes issue with the term “self-disconnection”, making the valid point that it implies an element of choice. It also makes the point that in a harsh winter the loss of power to homes is national news—even during the spring this year it was national news—yet the plight of prepayment meter users, who must endure a regular loss of supply in both summer and winter because they cannot afford to buy credit, goes largely unnoticed.

Stratford-on-Avon and district citizens advice bureau told me that it has worked with other citizens advice bureaux and other organisations in its area to conduct a survey of prepayment users. It found that, as I have said, the exclusion of people from the best deals is clearly part of the problem, but it also noted that a worrying number of people do not understand how they are charged when they have such a meter. Those who move into a property where there is already a prepayment meter inherit an unfair system. They may quickly get into difficulties through no fault of their own and they often cannot afford to change the system they inherit.

Citizens Advice Scotland also raised that point and noted that many consumers are caught unawares by standing charges, so debt may accumulate in periods when they are using very little energy and impact upon them when they start to use it again in the winter months. It quotes the case of a client who is having 70% of each payment taken to meet those charges. Surely it is high time that action was taken to end such charges.

Citizens Advice Scotland adds that when consumers are in receipt of benefits, energy suppliers should recognise that they face additional payment difficulties and take action to support them, especially given the significant ongoing changes in the benefit system. In particular, suppliers should monitor usage, particularly among prepayment consumers, and take proactive action if there is evidence of self disconnection. I have been contacted by the StepChange debt charity, which has pointed out that an increasing number of over-60s are in fuel poverty because of rising prices, and that that number is substantially higher than in other age groups.

Citizens Advice recommended that prepayment meters should be fixed at the supplier’s cheapest tariff. I fully support that and urge the Minister to take it up with the energy companies and, if necessary, introduce amendments to the Energy Bill in the other place to make it happen. He did not accept my amendments when they were offered to him, but I will not take offence if he introduces his own. That would help to ensure that customers who have difficulty paying for energy and use prepayment meters as a budgeting tool are not penalised for doing so, and that customers with arrears are not pushed further into debt by the additional costs of installing a prepayment meter and of paying a higher tariff.

I would go even further. I sought in my amendments to put a cap on the amount of any payment into the meter that can be used to meet accumulated debt. I suggested 20%, but in the example I quoted earlier 70% was being taken and we should agree that 70% is totally unacceptable in such circumstances.

When alluding briefly to my amendments last Monday, the Minister’s colleague, the Minister of State, Department for Business, Innovation and Skills, the right hon. Member for Sevenoaks (Michael Fallon), said that he was not in favour of a specific percentage because that could mean that people would continue to pay towards the debt over the summer months when they use little gas. However, as I said, because of the operation of standing charges on prepayment meters, debts continue to increase over that period whether energy is being used or not, so that argument does not hold water. He also stated that it would take a long time for a family to get out of debt. The problem with that approach is that people on low incomes cannot ever get to the stage of being able to heat their homes properly, leading to ever greater difficulty.

It may take much longer to pay off the debt, but it is surely better to accept that in an age of ever-increasing energy bills—few of us believe that they will fall significantly in the foreseeable future—we must make a much greater effort to help those who are in genuine difficulties, and accept that when people have got into difficulties the arrears simply must be paid off over a much longer period. It is imperative to ensure that people can heat their homes and cook their food, and are not subject to having no energy because they cannot afford to put credit on the meter.

Will the Minister consider whether that is a sensible way of dealing with an increasing problem? If he followed up some of my suggestions, it might help the Prime Minister to fulfil his promise to ensure that everyone is put on the lowest tariff.

Energy Bill

Debate between Jim Shannon and Mike Weir

Tuesday 4th June 2013 Commons Chamber

[Mr Weir]

I said at the outset that SNP Members did not oppose this Bill on Second Reading and we will not oppose it tonight. We recognise the need for electricity market reform and support much in the Bill. I understand the Minister’s point—I understand that contracts for difference could well be a good way forward—but I remain concerned about the lack of much of the detail, and I say that for two reasons.

In Committee, I raised the issue of the closure of the renewables obligation system in 2017 and whether that could have an impact on investment in the meantime. Many companies that are considering investment are still unsure about how the CFD system will work and are concerned about the changeover. More thought should have been given to how the interim period could be dealt with, perhaps by extending the RO system. Regrettably, the Minister was not prepared to accept that.

The other point about CFDs is that we still do not know what is being negotiated between the Government and EDF in respect of Hinkley. Whether or not I am anti-nuclear, that is important, because whatever those details are they will inevitably become the template for future CFDs in the nuclear industry. If the price is set too high and the contract is too long, that could have huge implications for the public purse in the future. None of those details are available. We are told that they will be available in July, presumably when the House is in recess, but we have no opportunity to look at these things, and that is a shame.

Late in the proceedings, the Government introduced amendments on consumers, including the Prime Minister’s promise to put them on the lowest tariffs. I do not think they were strong enough and I tabled amendments on Report that, unfortunately, were not reached because of the time available.

I also tabled an amendment to deal with a question that I have often raised about winter fuel allowances and the need to provide small-scale practical help for consumers, but it fell into the last group tonight.

[Jim Shannon]

On that subject, statistics show that in the past year 24,000 people died from cold-related causes. That was due in a big way to the inability of the system to address people’s needs early. Does the hon. Gentleman feel that it is not too late for the Government to take that on board and that ensuring the early payment of such money at a time when oil is cheap would be a good way forward?

[Mr Weir]

That is an excellent way forward. The Minister of State, Department of Energy and Climate Change, the right hon. Member for Sevenoaks (Michael Fallon), has convened a round table on oil-fired heating. The first meeting was held in May and I welcomed that. It was a useful meeting and might perhaps be a way of dealing with that industry, but we need small-scale help as electricity market reform is not the only way of dealing with energy markets. Small-scale things can be done that make a real difference and the Government must grasp some of those issues, rather than simply considering massive measures such as this Bill.

There is a decarbonisation target. We fully support it; I spoke in the debate on it and gave the reasons why. If Governments north and south of the border want a true, green, sustainable manufacturing base, a decarbonisation target will give companies the assurance that will allow them to invest for the future. It will enable them to be sure that they have a market as they push towards it. It could also provide a huge amount of sustainable, highly skilled jobs. As I pointed out earlier, growth in the Scottish economy has come largely from the energy industry and such development could be a huge boost for the future, so it is unfortunate that we do not have that target.

There are defects in the Bill, but there are some good things. We will not oppose the Bill on Third Reading, but I hope that when it gets to the other place the Government will reconsider some of the issues.

Winter Fuel Allowances

Debate between Jim Shannon and Mike Weir

Tuesday 27th November 2012 Westminster Hall

[Mr Weir]

The hon. Gentleman makes a good point, and I was going to address some of those problems. In many rural areas, the situation is exacerbated by the fact that much of the housing is old and of a construction that makes it difficult to install energy-saving measures such as cavity wall insulation. Many houses in rural Scotland are of a solid wall construction, and there is a limit to what can be done to save energy. Once the roof insulation has been put in, the only real option is to install some sort of solid wall insulation, which is difficult in many of those houses.

Such households will receive the same winter fuel allowance as pensioners on the gas grid, but there is a crucial difference in how the energy is delivered. Those who are on the gas grid will receive their winter fuel bill around the time that the winter fuel allowance is generally paid, so the system works well for those people. Indeed, in the explanatory notes to the regulations that last amended the benefit, the previous Government specifically stated:

“They are paid in a lump sum each winter to ensure that money is available when fuel bills arrive.”

No one could dispute that that is a good thing, but that is not how it works for those who are off the gas grid. Such people face the difficulty of having to pay for their LPG or home fuel oil up front at the beginning of the winter, well before they have the benefit of the winter fuel allowance. Many find it difficult to do so and may not completely fill up the tank, leaving them having to do so in the depths of winter, which brings its own problems, and not only due to the cost.

The OFT’s report found that there are many competing suppliers in the market, but by definition many of those suppliers are small. Although some of the larger players offer greater payment flexibility, smaller ones are unable to do so. The Minister may be interested to know that some of the bigger players have expressed an interest in doing something, but they sometimes have difficulty finding vulnerable customers because of the regulations. Although electricity companies, for the purpose of the discount, can access such information, I understand that other energy companies cannot because of the way the regulation was drafted under the Energy Act 2010.

[Jim Shannon (Strangford) (DUP)]

I thank the hon. Gentleman for bringing such an important issue to the House.

The same thing happens in Northern Ireland. Gas is available in Newtownards but not on the peninsula, while gas is available in Comber but not a few miles away in Ballygowan. For those reasons, accessibility is being held back for a great many people. Is it not time for the Government to consider issuing licences generally so that gas can be accessible for everyone?

[Mr Weir]

That is an excellent idea. I note that the leader of the hon. Gentleman’s party, among others, supported my private Member’s Bill, because this is a huge problem in Northern Ireland, although Northern Ireland has different regulations because social security is a devolved matter.

The price of fuel is rising—often quite substantially—as winter approaches. Even those suppliers that offer a fixed winter price will be doing so at a price higher than in the summer. As the Minister will appreciate, there can also be a problem getting a delivery. Hon. Members will recall the dreadful weather of two winters ago, when many of my constituents faced huge difficulties getting their tanks filled. Some were left with no fuel in the run-up to Christmas. The situation is exacerbated by how the oil companies work, because some modern tanks have a gauge, and the companies will deliver only when it falls to a certain level. If somebody cannot get their tank filled when they want to because the oil company has decided that it is not an urgent case, and bad weather then comes quickly, it can cause huge problems.

Seasonal Agricultural Workers Scheme

Debate between Jim Shannon and Mike Weir

Wednesday 20th June 2012 Westminster Hall

[Mr Weir]

It is obvious that all hon. Members are keen to support agriculture throughout the UK, particularly produce from their own areas.

As I said, Angus sits in the middle of the Scottish soft fruit-producing area, and today I wish to concentrate on the employment problems faced by soft fruit growers. When I was growing up—it seems a long time ago now—it was commonplace during the school holidays to pick raspberries and strawberries, and to pick potatoes during the “tattie holidays”, as they are known in Scotland. It was a good way to make money to see us through other parts of the year.

[Jim Shannon (Strangford) (DUP)]

The humble Comber spud is recognised by and renowned throughout Europe. It is also renowned in Scotland as a superior potato.

[Mr Weir]

The hon. Gentleman is completely wrong; there is nothing better than Scottish potatoes. Quite rightly, everybody will promote their local produce and it is part of our job to ensure that people know about the delicacies produced in our own areas.

Let me return to my point about soft fruit. Over the years, things have moved on and industry has, I dare say, become more professional and no longer needs to rely on the work of schoolchildren and others. The focus has moved to the employment of more direct seasonal labour, and the spread of cultivation methods such as polytunnels has expanded the types of fruit grown. As well as strawberries and raspberries, we are increasingly growing blueberries in my area. Traditionally they came from Poland, but they are now being grown in Scotland and other parts of the UK. That has led to changes in industry, as have the increasing demands of major supermarkets. The hon. Member for West Worcestershire mentioned the machinery that is now required to meet the huge demands supermarkets impose on industry, which has to produce good quality uniform produce quickly and to the supermarkets’ requirements. Recent trends include increased use of polytunnels for growing soft fruit, rather than open field production.

Horticulture is a vital part of the Scottish economy, particularly in areas such as mine. In total, the horticultural industry—fruit, vegetables and flower production—contributed some £241 million to the Scottish economy in 2010 and, as the hon. Member for Sittingbourne and Sheppey said, it contributes more than £3 billion to the UK. Most growers in my area rely to a greater or lesser extent on migrant labour, particularly people from Bulgaria and Romania who come to work in the UK under the seasonal agricultural workers scheme. It is a huge pity that the issue of young people—principally those from EU accession states—coming to work in the UK agricultural sector has become completely tangled up with the more general issue of immigration. The vast majority of those who come to work in agriculture are in the country for a short, specific period and intend to return to their home nations at the end of their visa period. Unfortunately, as in many other areas, there is often a serious collision between perception and reality.

Under the current scheme, some 21,250 visas were issued last year for workers to come to the UK for periods of between five weeks and six months. Angus Growers, a co-operative that operates 19 farms in Angus and its surrounding areas, tells me that at the peak of the season it employed 2,000 people, the majority of whom were obtained through SAWS. Angus Growers is concerned that the current scheme is guaranteed only until the end of 2013, and it is worried about whether a replacement will be introduced after that. I appreciate that the Minister is in slightly difficult position because although he is responsible for agriculture, SAWS is run by the UK Border Agency, and I assume therefore that the decision on whether the scheme continues will be taken by the Home Office. Nevertheless, I would be interested to hear his perspective from an agricultural point of view.

Let me stress that the use of seasonal workers should not be seen as an example of growers looking for a source of cheap labour. SAWS is a detailed scheme and the minimum wage has to be paid.

Postal Services Bill

Debate between Jim Shannon and Mike Weir

Thursday 9th June 2011 Commons Chamber

[Mr Weir]

The hon. Lady has taken her chances by asking that question, but it goes beyond the scope of the amendments before us. The Post Office is very important to rural areas of Scotland, and I will merely note that the Scottish Government have done much more than the UK Government to help rural post offices in the future—such as through the diversification and rates rebate schemes. That illustrates what we would do in an independent Scotland.

To return to the point I was making before being led down this interesting side road, the lack of detail about the structure presents a dilemma because, depending on what method is chosen, there could be unintended consequences in the future. If the John Lewis method is pursued, there may well be no problem, in that it will be a trust holding and will, in all likelihood, be held at or above the 10% level. However, if the shares are distributed to individual employees, we could have a very different scenario. Experience of previous privatisations suggests that a number of employees would immediately sell their shareholdings, and others would be likely to sell at some future date, either when they retire or, perhaps, by their executors on death. There is absolutely nothing wrong with that; they would be their shares so they can dispose of them as they see fit. Such actions could, however, have a serious consequence for the continuation of a workers’ shareholding within the company, because of the operation of our current company law, and especially as Ministers have made it absolutely clear that they would be relaxed about Royal Mail being bought either by one of the major foreign postal operators or by private equity companies up to the remaining 90% figure.

I remind the House that in cases where private equity companies have bought listed companies, they have on occasion de-listed the company and operated it as a private company. I particularly draw Members’ attention to the terms of section 429 of the Companies Act 1985, which gives provision in respect of implementation of the EU directive on takeover bids. One of the purposes of the directive was to deal with the problems of, and for, residual minority shareholders following a successful takeover bid, processes known as “squeeze out” and “sell out”. The provisions in question provide that following a takeover offer:

“If the offeror has, by virtue of acceptances of the offer, acquired or unconditionally contracted to acquire—

(a) not less than nine-tenths in value of the shares to which the offer relates, and

(b) in a case where the shares to which the offer relates are voting shares, not less than nine-tenths of the voting rights carried by those shares,

he may give notice to the holder of any shares to which the offer relates which the offeror has not acquired or unconditionally contracted to acquire that he desires to acquire those shares.”

In effect, therefore, anyone who acquires 90% of the shareholding in a company can force the sale of the shares of the remaining small shareholders and become sole owner of the company. If the Government were to sell 90% of Royal Mail to, say, Deutsche Post, there could clearly be a potential difficulty in regard to the workers’ shareholding in the future if that is held individually by Post Office workers. If at any time the individual shares held by the work force were to fall below 10%, there is the potential for the owner of the remaining 90% to force a sale and therefore wipe out the shareholdings of the workers.

I am sure the Minister will, in his usual inimitable manner, tell me that I am constructing a theoretical problem that would not occur in the real world, but I wanted to propose an amendment on this point because of a real case of this kind involving constituents of mine. My constituents, who are pensioners, were shareholders in Dana Petroleum, and had been for a large number of years. The company was not paying dividends, but the shareholding did increase in value and my constituents regarded it as a nest egg for the future. Unfortunately, Dana Petroleum was subject to a hostile takeover by the Korean National Oil Corporation, which I believe is state-owned—I believe it is part of a sovereign wealth fund. That company purchased the majority of shares, although my constituents did not wish to accept its offer. The new owners decided to de-list the company, with the effect that my constituents were forced to sell their shareholdings, in their case causing a capital gains tax liability.

Unless the Government give us details of the form the shareholding will take, there is a genuine danger that we could face that situation within Royal Mail in the future. If the Minister will stand up and say, “It will be the John Lewis model; it will be a share trust of at least 10% of the shares for all the employees in the company”, I do not think there will be a problem. Alternatively, however, we might go down the same road as with previous utility sales, where individual shares were given to the workers and that shareholding within the companies has been reduced over the years. It is interesting to note that many of the former utilities are now offering special deals to get small shareholders to sell out their remaining shares because they do not want the small shareholders. Although this idea of worker participation is a good one, I would rather the company was not privatised. If that does happen, however, the bigger the workers’ shareholding within it, the better, and the shareholders would, it is to be hoped, have real rights.

As there is a lack of detail on this point, there is a danger that we will end up with nothing for the workers and the company wholly in the hands of one, possibly foreign, postal service or private equity company. The recent experience of private equity companies buying out limited companies is not a good one; we need only look at the current problems with Southern Cross to see that. I ask the Minister to reflect on this issue, and give us an assurance on it, or at least more information as to how the shareholding is to be held.

[Jim Shannon (Strangford) (DUP)]

I am aware that you have asked us to focus on the amendments, Madam Deputy Speaker, and I intend to do just that. I want to focus my comments on Lords amendment 9 to clause 11, referring in particular to the universal service provider. While some level of provision is given, I am not entirely convinced that we will have a better service. That is my opinion, and it is informed by the views of the people I represent, because they are telling me the same thing. It is being said not only by Post Office personnel, and among them it is stated by both those who own post offices—postmistresses and postmasters—and the Postman Pats of this world who do the hard graft out on the streets. Some Members have spoken about the business plan that post offices need in order to make them sustainable. Can the Minister convince me and other Members—and, through the Hansard report of the debate, convince my constituents—that the service will continue to deliver in the large rural community I represent that stretches from Portaferry to Ballynahinch?

For many of my constituents, post offices are a crucial part of their community. They are the front office of government. I am unconvinced that the revenues of sub-post offices will not decline, and that could lead to some of them closing. We need the Minister to respond to that point.

Some Members have spoken about the continuity of contracts beyond five years, and that is essential. The postmistresses and postmasters of the rural post offices in the areas I represent have told me that they are under absolutely no illusion about how things will progress, and I say on behalf of them that we need to ensure that they have such continuity.

Under the new law, the universal service for six days a week with one price sending post anywhere could be downgraded in just four years, and it is feared that the everyday post office user will experience price hikes and have to pay for the privatisation. The unions have pointed out the possible consequences of privatisation in respect of postal services, and I look forward to hearing the Minister comment on that point. This has already happened in the Netherlands and Germany, where the rural service has been reduced to three days a week, and the costs have risen.