Energy Company Charges

Lindsay Hoyle Excerpts

Tuesday 4th February 2014 Commons Chamber

[Mr Deputy Speaker (Mr Lindsay Hoyle)]

Let us see whether we can get someone to open the debate. Who wishes to move the motion?

[Several hon. Members]

rose—

[Mr Deputy Speaker]

Look at that. Albert Owen—just like a man from Wales. Let us start with you.

[Albert Owen (Ynys Môn) (Lab)]

I beg to move,

That this House is disappointed that 17 energy companies in the UK charge their customers more if they do not pay their bills by direct debit; acknowledges that some firms do not charge their customers any extra at all; notes that Department of Energy and Climate Change statistics show that this adds £114 to the average consumer’s bill; further notes that 45 per cent of people do not pay their energy bills by direct debit; recognises that over one million people in the UK do not have access to a bank account; believes that these charges are a stealth tax on the poor; and therefore urges Ofgem to hold an inquiry into these practices, encourages energy companies to operate with more transparency, and urges the Government to consider ways of limiting these charges, such as by introducing a cap.

I was going to start by paying tribute to the hon. Member for Harlow (Robert Halfon) on opening the debate; I am sure we will reverse that role when he arrives. I think it is an appropriate time to have such a debate. I am pleased to be among the many Members who have signed the motion. I am not sure—I seek your advice, Mr Deputy Speaker—whether I should stop my speech when the hon. Gentleman arrives, or whether I should continue.

[Mr Deputy Speaker]

Keep going.

[Albert Owen]

That is what I wanted to hear.

Energy prices have been a serious issue for some time, but attention has recently been concentrated on it because of the high hikes in those prices. Fuel poverty is very much on the agenda again as many people are feeling the strain of the energy price hikes, particularly in rural areas. I know that the Minister has been before the Energy and Climate Change Committee on this issue. The Department’s own figures show that twice as many people in rural areas as in urban areas are suffering from fuel poverty. It is worth putting that on the record, because people in my constituency and in many constituencies across the UK are really suffering from energy prices.

As many people are now acknowledging, the energy market is flawed in many ways. As hon. Members will know, it was set up when gas and electricity were privatised. The old structures were used and the energy market developed from that. There were price controls very early on, and the regional distributors and energy companies all came together. In the beginning we had the big three; the big five and the big six were not invented at the time of the near-monopoly under Labour.

--- Later in debate ---

[Mr Deputy Speaker (Mr Lindsay Hoyle)]

Order. A lot of Members are waiting to speak. I know that the hon. Gentleman is coming towards the end of his speech, which is heading towards 15 minutes.

[Albert Owen]

I was dragging out my speech, because some hon. Members had not arrived in the Chamber. That explains the slowness of my opening remarks, but I am now getting to the crux, if not the end, of my argument. The points made in interventions are important: people do not choose to be in such a position, but some are, and there should be a mix of payment methods.

Those who use buzzwords about a free, open and liberal market are missing the point. Much of the energy we consume involves fixed costs over which companies have argued in the past few months that they have no real control. I am talking about such matters as commodity prices and transmission costs. Companies should be fairer in how they bill people, and should not penalise people or discriminate against them through their payment methods.

Other hon. Members have mentioned the choice to switch. To be honest, it is very perverse that energy companies and the Government push switching. No other sector of industry says, in a competitive market, “If you don’t like what we do, go somewhere else.” Can we imagine supermarkets adopting that policy?

I want energy companies to give loyalty bonuses to people who stay with them as long-term customers, rather than tampering with their accounts and penalising them for how they pay. I am told by energy companies—I have no reason to dispute this—that the regulator does not allow it. We should look at that, and if we had the proper review called for in the motion, the regulator would have to consider such issues and help people by alleviating the effects of the high percentage increases of the past few weeks.

The motion is about Ofgem doing its job and standing up for the consumer, the Government being on the side of the consumer, and us, as a Parliament, being on the side of the people we were sent here to represent.