Oral Answers to Questions

Kwasi Kwarteng Excerpts

Tuesday 29th March 2022 Commons Chamber

[Mr Virendra Sharma (Ealing, Southall) (Lab)]

2. What steps he is taking to support households affected by the increase in energy prices in April 2022.

[The Secretary of State for Business, Energy and Industrial Strategy (Kwasi Kwarteng)]

As the hon. Gentleman knows, the energy price cap continues to protect consumers in a world where gas prices have more than quintupled in a year, and I strongly expect that it will continue to do so.

[Mr Sharma]

I thank the Secretary of State for that answer. Given the pressure that families are facing in this cost of living crisis, does he agree that the best way to help families to pay their bills is through a windfall tax on oil and gas producers in the North sea to give the poorest up to £600 off their bills?

[Kwasi Kwarteng]

As the hon. Gentleman will know, we believe that a windfall tax in this situation would be a tax on jobs, destroy investment and add to the uncertainty in oil markets. It would send completely the wrong message to investors, as well as to people who are invested in markets. Every one of us, anyone with a pension, would be adversely affected by such a tax.

[Alun Cairns (Vale of Glamorgan) (Con)]

My right hon. Friend is keen to ensure that householders and landlords improve the energy performance of properties. Will he consider the effectiveness of the current energy performance certificate system and whether that genuinely reflects the energy performance of a property? In addition, will he recognise the additional costs incurred in calling for improvements in off-grid properties, where people do not have the opportunity to invest in the same technologies as those in on-grid properties?

[Kwasi Kwarteng]

I am grateful to my right hon. Friend for that question. As he knows, the current EPC system is not perfect, but it does capture the significant improvement that has happened over the past few years. I am happy to consider people off grid and the challenges that they face from oil prices, and I would be happy to speak to him about that.

[Angus Brendan MacNeil (Na h-Eileanan an Iar) (SNP)]

In recent years, the UK Government have printed and borrowed hundreds of billions of pounds, which have been gathered—I emphasise the word “gathered”—not earned by billionaires and the already wealthy. As a result, we have a cost of living crisis that makes energy price rises an acute crisis. Kerosene central heating oil has seen some of the biggest price differences, which especially hits rural and island areas where there is no mains gas. Do the Government have any plan to give people in such places a hand, which would cost a damn sight less than the bailout money that the billionaires have raked in from the Treasury?

[Kwasi Kwarteng]

As the hon. Gentleman knows, my right hon. Friend the Chancellor of the Exchequer announced an extensive package of support only a few weeks ago worth £9.1 billion—that included a £150 council tax rebate for bands A to D and £144 million in discretionary funding for local authorities—which affects everybody in this country. I am also very happy to engage with him on the specific issue of oil prices.

[Sara Britcliffe (Hyndburn) (Con)]

I have been contacted by many pensioners across Hyndburn and Haslingden who are concerned about the cost of their energy bills. Will the Secretary of State set out what measures are in place to support my residents, and will he continue to work with other Departments to keep those measures under review?

[Kwasi Kwarteng]

As I said, the Chancellor announced a £9.1 billion package of support only a few weeks ago. That included the £150 council tax rebate for bands A to D and £144 million in discretionary funding added for local authorities—spending to help the most vulnerable. We announced a £500 million extension of the household support fund last week, but I would be happy to engage with my hon. Friend on what more we can do in the next few months to assuage the burden.

[Mr Speaker]

I call the shadow Minister, Dr Alan Whitehead.

[Kwasi Kwarteng]

I am very happy to answer the hon. Gentleman’s questions. He will know that the next price cap period will be set in August. Even he, with his gifts of prophecy, does not know what the price cap level will be in August. As the Chancellor of the Exchequer has said, we are continually reviewing actual spot markets and what is happening in the market.

The hon. Gentleman will know that nothing could be more damaging to the sector, to people employed in the sector and to the hundreds of thousands of jobs and families dependent on the sector than an arbitrary windfall tax, which would also impoverish many of the people exposed to those companies through their pensions. It is a regressive, retro measure that completely does not understand what business is all about.

[Mr Speaker]

I call the SNP spokesperson.

[Stephen Flynn (Aberdeen South) (SNP)]

Aside from saying that he drives an ageing VW Golf, the Secretary of State is using every excuse possible to try to defend the indefensible. In just a matter of days, the energy price cap will increase by some 700 quid; in just a matter of months, it is anticipated that it will increase by a further £1,000. The Government’s response is 150 quid off council tax and £200 that they say is not a loan, but that is indeed a loan. Energy bills are anticipated to increase 14 times faster than wage increases. How on earth are people supposed to get by?

[Kwasi Kwarteng]

As I have said, we have a £9.1 billion support package, which was announced only four weeks ago. On top of that, we allocated £500 million of additional relief only last week to help people through this difficult time. One way in which I am afraid bills would go up is if we adopted the insane SNP policy of essentially shutting down North sea oil and having no intention at all to develop nuclear. That would be an utterly irresponsible and highly expensive way of dealing with the current problem.

[Stephen Flynn]

The Secretary of State does himself no favours by attempting to invent policies that are simply not reflective of the SNP’s position at this moment in time—but this discussion is about energy bills. If someone lives in the north of Scotland, their energy bill standing charge will increase by some 83%; if they live in the south of Scotland, it will increase by 100%; but if they live here in Westminster, in London, it will increase by just 38%. Scotland is energy-rich—oil and gas, wave, wind, tidal, hydro pumped storage. How on earth can the Secretary of State justify the inequity in such pricing?

[Kwasi Kwarteng]

The hon. Gentleman is indeed correct: Scotland is extremely wealthy in its range of energy sources. That is why we have sought to encourage it through things like the £27 million Aberdeen energy transition zone and the North sea transition deal. We have constantly supported the Scottish energy industry. The hon. Gentleman refers to a report by Ofgem. I speak to it regularly, and we always try to see what we can do to justify and to equalise bills across the UK.

[Andrew Bridgen (North West Leicestershire) (Con)]

I welcome the fact that the Prime Minister has announced that he will publish an energy supply strategy to deal with the UK’s energy requirements for the short, medium and long term. Can the Secretary of the State update the House on when we can expect the strategy to be published?

[Kwasi Kwarteng]

Very shortly.

[Munira Wilson (Twickenham) (LD)]

3. What plans he has to support the development of the renewable energy sector.

[The Secretary of State for Business, Energy and Industrial Strategy (Kwasi Kwarteng)]

As the hon. Lady will know, few countries have done as well as we have in respect of offshore wind. We are backing a range of other technologies through our strategy, and also through the 10-point plan.

[Munira Wilson]

Russia’s invasion of Ukraine has made clear how crucial it is for the UK to press on with the push to roll out renewables and strengthen its energy security. Almost three weeks ago, the Prime Minister said that an energy independence plan would be unveiled in the next few days and there was speculation about a renewed push for onshore wind, but that plan has been delayed again, apparently because the Chancellor is blocking it. Will the Secretary of State explain why the Chancellor is now deciding energy policy?

[Kwasi Kwarteng]

The hon. Lady will understand that, when such publications are issued, a range of cross-Government “write-rounds” is required. We are constantly talking to colleagues across Government, not just in the Treasury, so that we can land the energy strategy as quickly as possible.

[Derek Thomas (St Ives) (Con)]

Getting on top of energy issues, particularly those relating to renewable energy, is the most difficult challenge in rural areas such as mine. How will the Secretary of State’s strategy—to be launched soon—enable the renewable energy sector to grow from the grassroots up, so that people in fuel-poor homes, who may not have the money to buy the necessary equipment at the outset, have an opportunity to install solar panels and battery storage which will help them to deal with the rising cost of energy?

[Kwasi Kwarteng]

We have just cut VAT on many of those products. I have already visited my hon. Friend in his constituency, and I am happy to have further discussions about what more we can do to drive the take-up of these important technologies.

[Afzal Khan (Manchester, Gorton) (Lab)]

4. What steps his Department is taking to help ensure that the supply chains of businesses in the UK do not use forced labour of Uyghurs in Xinjiang, China.

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[Munira Wilson (Twickenham) (LD)]

T1. If he will make a statement on his departmental responsibilities.

[The Secretary of State for Business, Energy and Industrial Strategy (Kwasi Kwarteng)]

Since we last met, my Department has been focused on three central strands. First, we are pleased to announce the passing of the Economic Crime (Transparency and Enforcement) Act 2022. Secondly, we have worked with Ukrainian colleagues to make sure that generators are arriving in Ukraine so that their public services can be powered and delivered. Thirdly, I am pleased to announce that we are phasing out imports of Russian oil over a nine-month period to make sure, with our allies, that the Kremlin does not benefit from its sale of hydrocarbons.

[Munira Wilson]

Small businesses across my constituency are struggling, like households, with spiralling energy costs. The British Chambers of Commerce reports that three out of four firms it surveyed will be passing on these costs to customers through higher prices, thus further fuelling the cost of living crisis for many people in Twickenham and across the country. What will the Secretary of State do to alleviate the pressure on small and medium-sized enterprises that are facing rising energy bills?

[Kwasi Kwarteng]

The hon. Lady will know that not only did my right hon. Friend the Chancellor of the Exchequer announce a £9 billion package particularly for the most vulnerable, but for all our citizens, a few weeks ago, but last week we announced a support package, again, for vulnerable customers. In relation to small business, she will know that over the past two years this Government have spent £405 billion in supporting businesses of all sizes through a very difficult pandemic and, again, through the heightened crisis that has been brought on by the Russian invasion of Ukraine.

[Several hon. Members rose—]

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[Jonathan Reynolds (Stalybridge and Hyde) (Lab/Co-op)]

Last October the Secretary of State promised support for energy-intensive industries such as steel, glass and ceramics. His exact words were that it was his

“priority…to ensure costs are managed and supplies of energy are maintained.”

Yet six months later there is still no action, and there was nothing in last week’s spring statement, so when will this promised support be presented?

[Kwasi Kwarteng]

The hon. Gentleman will know that support is ongoing. We have the industrial energy transformation fund, which has allocated more than £50 million. We have also supported EIIs—energy-intensive industries—to the tune of £2 billion since 2013, so support is always there and has been ongoing.

[Jonathan Reynolds]

A chemicals manufacturer in Grimsby has been in touch with me this week. Its energy bill last year was £10 million; it has now gone up to £50 million a year. And it gets worse, because as we have heard in questions today, in two days’ time, compensation for the UK emissions trading scheme and the carbon price support mechanism comes to an end, so support is actually decreasing. Will the Secretary of State at least do the bare minimum and reassure firms today that that support fund will be extended?

[Kwasi Kwarteng]

I will reassure businesses that I engage with that we are constantly engaging in conversations with our Treasury colleagues and across Government to see how best we can use the existing schemes to support industries—the steel industry, ceramics industry and chemicals industry—in this difficult time.

[Jack Brereton (Stoke-on-Trent South) (Con)]

T4. I thank the small business Minister for speaking to our Staffordshire chamber of commerce event in Parliament recently. Recruitment continues to be a challenge for many businesses across Stoke-on-Trent, so will my hon. Friend outline what more we can do to support small businesses, particularly to upskill and recruit more workers?

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[Jason McCartney (Colne Valley) (Con)]

T5. I very much welcome the Chancellor scrapping VAT on home energy-saving products in his spring statement last week. Does my right hon. Friend the Secretary of State agree that now really is the time to turbo-charge a green homes programme? Let us insulate homes and help people to cut their energy bills and keep warm.

[Kwasi Kwarteng]

My hon. Friend knows that energy efficiency is at the centre of any net zero strategy, and I would be happy to work with him to ensure that we can drive progress in this area.

[Jonathan Edwards (Carmarthen East and Dinefwr) (Ind)]

T8. People already struggling to make ends meet will be hit by an increase in the unit price of electricity next month, and for many in Wales their daily standing charge will also double. In the interests of transparency and fairness, has the Department considered the merits of introducing a system of single unit pricing, so that consumers can more easily compare the costs charged by energy providers?

[Kwasi Kwarteng]

The hon. Gentleman will appreciate that the Department continually looks at a range of schemes to see how best we can lighten the burden of rising energy prices.

[Bim Afolami (Hitchin and Harpenden) (Con)]

T6. On nuclear, there has been much talk of the small modular reactors created by Rolls-Royce, which the Government are rightly supporting, and lots of talk of the progress on nuclear fusion at Culham in Oxfordshire. What is the Department’s assessment of progress on these technologies? How can we increase the speed of their deployment, and what policy interventions might help with that?

[Beth Winter (Cynon Valley) (Lab)]

T9. For the 11,5000 Cynon Valley households in receipt of social security benefits, the spring statement offered absolutely nothing. Inflation is anticipated to reach 9%, and they are expected to use a disproportionate amount of their income to cover energy cost increases of 50% in April—and another 40% increase is forecast for October. There is to be a social security payment increase of a paltry and quite insulting 3.1%, which links back to the inflation rate in September last year. What consideration have the Government given to introducing a low income energy tariff, so that they can better target support at lower-income households, as suggested by the Welsh Government?

[Kwasi Kwarteng]

As the hon. Lady is aware, we have made a number of interventions that have gone some way to lightening the burden. There is the £9 billion that my right hon. Friend the Chancellor announced a few weeks ago, and £150 off council tax for those in bands A to D. I have reassured the House that we are looking at a range of measures to see how best we can meet the challenge of the next few months. Nobody knows where the price cap will be in October.

[Theresa Villiers (Chipping Barnet) (Con)]

T7. The price cap, the cut in fuel duty and the warm home discount are providing vital help with bills, but will the Government commit to further action, domestically and internationally, to try to get energy prices down, so that we can help pensioners and other vulnerable groups?

[Kwasi Kwarteng]

My right hon. Friend is absolutely right to identify this as an issue. That is why we are working, not only in Government but across G7 partners, to ensure diverse sources of energy supply, which can keep prices down.

[Liz Twist (Blaydon) (Lab)]

In Chopwell in my constituency, over 200 homes were due to benefit from cladding under the green homes grant local authority delivery scheme, but due to escalating costs, that work has been cancelled. Will the Minister meet me to discuss how we can ensure that the work is carried out?

[Kwasi Kwarteng]

As the hon. Lady knows, local authority delivery of the green homes grant was very successful, but I would be very happy to meet her to discuss the case she mentions.

[Dame Caroline Dinenage (Gosport) (Con)]

Last year, my right hon. Friend the Secretary of State made the welcome announcement that employment leave would be extended to unpaid carers. Will he please update the House on when that is likely to be delivered?

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[Lee Anderson (Ashfield) (Con)]

Geothermal energy from old coalmines can heat our homes for years to come. Will the Secretary of State please assure me that he is doing all he can to support the Coal Authority in developing this fantastic new energy opportunity?

[Kwasi Kwarteng]

We are, absolutely, excited about the prospects for geothermal. I would be very happy to meet the hon. Gentleman to discuss this. I was happy, also, to talk to my Cornish colleagues about this exciting new technology; it is something on which we are focused.

[Joanna Cherry (Edinburgh South West) (SNP)]

The pupils of Boroughmuir High School’s climate change society in my constituency have impressed on me that their generation is relying on us to take action right now, because by the time they are old enough to do so it will be too late for systemic change. Can the Secretary of State reassure school students in my constituency that his plans for transition have the requisite urgency?

[Kwasi Kwarteng]

They do. I was very pleased to take up my office as Minister of State for Energy a month after the net zero legislation was passed, and for the last three years we have been resolutely focused on living up to the letter of the law, fulfilling our bargain and making sure we reach net zero in 2050.

[Martin Vickers (Cleethorpes) (Con)]

The Secretary of State is well aware of the opportunities for further developing the renewables sector in my Cleethorpes constituency and the wider Humber region. However, as he is also aware, there have been one or two setbacks of late. Will he meet me and neighbouring colleagues to discuss how we can move forward and maximise such opportunities?

[Kwasi Kwarteng]

I would be very happy to meet my hon. Friend. I am very excited about what is going on in his constituency and the wider Humber area, and I look forward to talking to him about decarbonisation.

[Kate Green (Stretford and Urmston) (Lab)]

Unscrupulous company directors make use of the compulsory strike-off process to avoid paying debts to both private and public sector creditors. In considering reform of Companies House, what can Ministers do to tackle this practice?

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[Kwasi Kwarteng]

I would be happy to talk to my hon. Friend about those issues. I would like to point out that we had a significant victory in extending the safeguards last summer, and there has been some very good news on trade talks about the quotas that steel companies in this country are allowed by the US.

[Marsha De Cordova (Battersea) (Lab)]

The energy crisis is leaving some people in my constituency struggling to pay their bills, and the situation is even worse for those whose heating is paid for centrally and is not protected by the energy price cap. In some cases, many have seen their bills go up by more than 500%, so when will the Secretary of State bring forward legislation that will give Ofgem the powers to regulate these prices and end these excessive energy price increases?

[Kwasi Kwarteng]

The hon. Member will know that we are speaking with Ofgem about this very issue. Yes, the price cap does protect the vast majority of people, but there is an issue with people off grid, which I would be very happy to talk to her about.

[Mr Richard Holden (North West Durham) (Con)]

There is great concern in North West Durham among constituents affected by Storm Arwen about the prospect of being left without a landline as well as without power during a storm, due to the switch to the voice over internet protocol. Given that, does the Secretary of State, like me, welcome the announcement from BT today that this forced switch will now be paused and be on request only, as BT looks to ensure that proper back-up systems are in place during power cuts before returning to the broader roll-out?

[Kwasi Kwarteng]

I welcome the announcement. I was also very pleased to spend time with my hon. Friend in the unfortunate circumstances of Storm Arwen, and I look forward to the publication of that report soon.

[Drew Hendry (Inverness, Nairn, Badenoch and Strathspey) (SNP)]

Returning to off grid, Ofgem’s mission statement says that it aims

“to make a positive difference for all energy consumers, both now and in the future”,

yet off-gas grid consumers using electricity, oil and liquid gas face price rises in April four times that of Ofgem’s average consumer. Will the Secretary of State support my calls to regulate this for off-gas grid customers through Ofgem, and indeed support my Energy Pricing (Off Gas Grid Households) Bill?

[Kwasi Kwarteng]

Where I agree with the hon. Gentleman is that we need to have a more robust offer for people who are off grid. This issue has been raised continually in these exceptional times, and I look forward to speaking to Ofgem—and perhaps him—about these issues.

[Several hon. Members rose—]