Lord Deben
Main Page: Lord Deben (Conservative - Life peer)
Lord O'Neill of Clackmannan
I am very happy to follow my noble friend. The fight against fuel poverty in the past 10 to 15 years has been bedevilled by loose definitions and arbitrary targets. The amendment goes some way to mitigate concerns that have arisen about that. It sticks in my craw to say this but the Government must be praised for obtaining support for the measure from Derek Licorice, the chair of the Fuel Poverty Advisory Group, and Jenny Saunders of the NEA. The fact that people are giving understandably cautious support, but none the less a blessing, for the measure is an indication that Ministers have sought to build bridges on this issue. Known targets and definitions have been taken away and a rather more complex Hills approach has been adopted. That approach has its drawbacks but does take account of the complexity of the situation. Therefore, it is desirable to move forward not using the bludgeon of statutory change but rather a regulatory approach, as that will enable subsequent Ministers of whatever political complexion to adjust and calibrate the policies.
It is also fair to say that for us in Opposition to try putting forward amendments at this stage would be somewhat premature—although, from what one can gather of the parliamentary timetable ahead of us, we will have time, probably over the Recess, to look at some of these issues. Obviously, the statutory instrument and regulatory approach will be the subject of consultation and discussion. One would hope that that need not take an unduly long period. None the less, it will give us some opportunity to look at the fine print of this.
Some of us would be happier about this if we were to see the colour of the Government’s money, or indeed money at all from the Government. Their approach to fuel poverty has been to withdraw state funding from this and make it a tax on the consumer rather than on the country as a whole. That is a flawed policy. It would not be difficult for the Green Deal to become more successful than it is at present, but if it does not become substantially better we will have to look again at the Government providing funds for some of the major programmes that will be required to address areas of fuel poverty. We are not talking about individual households but street after street after street. If approached on that basis, we could deal with an awful lot of the most deep-seated areas which Hills recognises are the core of the problem.
As I said, I do not wish to be grudging in my support for this approach. There will obviously be difficulties and flaws but this is not the time to identify them. The opportunity for that will come on Report and beyond, when we have had time to digest some of the indigestible graphs to which the noble Lord, Lord Jenkin, referred. If we can do that, we can perhaps make something of this. At the end of the day, somebody has to pay for it. At the moment, that will fall in the main on the shoulders of the consumer of gas and electricity. That is not a satisfactory approach to social injustice on this scale. Even with the Hills modification, the scale is intolerable for a society such as ours to leave to some kind of slipshod market mechanism, the like of which we have seen in the Green Deal. The Green Deal might work. It is the only show in town but it will have to start working very quickly or some of us will not be confident that the great ideas and reasoned approach in this White Paper, these documents and expressed in this amendment will be enough, without proper financial support, to tackle the major social problem we have here.
Lord Deben
My Lords, I again declare my interest as chairman of the climate change committee, which has a specific responsibility to consider and concern itself with fuel poverty. It would be suitable for me to say a few words about this. I am very pleased that the Government have brought forward this amendment, not least because one of the difficulties of advising on fuel poverty has been the very peculiar mechanisms that we have used to measure it. To be able to measure it more effectively, to have a proper and accepted basis, will help us very much in giving advice. As noble Lords know, if you are a scientifically based committee, it is quite hard to move from making decisions on science, which is of course what we do, to making decisions on measurements that would not stand up to any kind of consideration from outside. This is a very good first step. All of us acknowledge the fact that there is widespread support for the principle but there is a lot to be worked through. I think most of us would agree with what the noble Lord who just spoke said.
It is worth realising, too, that it has much wider implications. As usual, we have been very much helped by the intervention of my noble friend Lord Jenkin. I am always amazed that he gets his head so easily around the most complex of issues and then lightly dismisses that by saying that he is not quite there yet. If when I get to the same stage of life, I am “there”—if I may put it so—as well as he is, I shall be very proud indeed. We owe him a huge debt of gratitude.
Baroness Maddock
My Lords, I thank the Minister for responding so quickly to our pleas last week about fuel poverty. I welcome what we have before us today. I think it is quite clear, as my noble friend Lord Jenkin said, that unless we understand the problem properly we cannot design effective solutions for it. I am particularly grateful to my right honourable friend the Secretary of State, Ed Davey, for pushing this within the coalition, and I am grateful that he has managed to move it forward. My noble friend Lord Deben talked about “may” and “must”: I think the answer is that my right honourable friend managed to persuade them on one issue, but not on the other.
Baroness Maddock
So we must help him to persuade others on the other issue, the decarbonisation target.
I will try not to be repetitive, because I agree with many of the things already said. I particularly welcome the fact that we are going to be monitoring things as they go along, that there will not just be an end target but targets in between, and we will see what is going on. The Warm Homes and Energy Conservation Act 2000, and the Home Energy Conservation Act before it, were both Private Members’ Bills. One of the problems with Private Members’ Bills is that they are not actually owned by the Government, and so they were not part of a big department getting together and putting legislation forward. Both those Bills suffered from that, because in many ways they were allowed to just drift along. That is a slight exaggeration, but the Warm Homes and Energy Conservation Act 2000, my own Act, drifted so much so that at the end the previous Government wanted to get rid of it completely. When the coalition Government came in—it was one in, one out—they thought it was ripe for the picking. We pointed out that you need that Bill if you are really into localism and are going to use local authorities—another thing I welcome in this regard. Maybe we will do a little better this time, because this has been an important piece of work done by a government department.
I commend to noble Lords the White Paper, Fuel Poverty: a Framework for Future Action. It will help people who have already contacted us because they were worried about one or two items that the noble Lord, Lord O’Neill, pointed out. It will answer some of their questions. This is not the final document and strategy. A more detailed strategy will come after the Bill has passed into law, so that we can co-ordinate it properly.
I will highlight one or two things. Everybody has talked about properties that are difficult to deal with for various technical reasons, but something that has always bothered me is that a large number of the fuel poor live in the private rented sector. Many things that we are trying to do are much harder to do in the private rented sector. I hope that, when the final strategy comes out, we can do something about that.
Some concerns that people have raised include the fact that we are changing the definition, and that it will be in secondary legislation. However, my experience of definitions being in primary legislation, in particular in the two Private Members’ Bills that became Acts that I talked about, was that it did not make any difference. Even though the target was in primary legislation, it seems that we are not going to hit it, so we have had to do something else. Therefore, history shows that that is not the total answer.
Many people who contacted us were worried about what the priorities and target dates will be. I hope that, as the noble Lord, Lord O’Neill, said, we will be able to look into that before Report. Clearly, a lot of detail will be in the final strategy, and we will be able to make our suggestions.
Another area that has been mentioned is how we will pay for this and how we can stop putting extra burdens on the fuel poor when we are trying to deal with climate change and decarbonisation. The document indicates that the Government are acutely aware of the issue, and that we need to look at how to deal with it. Perhaps my noble friend will be able to indicate some of the forward thinking on the issues that I have raised.
The other area that I particularly welcome is the commitment to much more cross-departmental working. That may be something we will touch on when we debate the next amendment about something else. We hear this phrase time and time again, but it does not always happen. Somewhere in the document it says that the Government will set up a body to work across departments. That has been tried in the past and has not been terribly successful.
I will touch on one issue mentioned by the noble Lord, Lord O’Neill, who talked about dealing with streets. One thing that has been discovered by those looking at who is fuel poor is that quite often they are peppered around streets. If you are trying to target your money at the fuel poor, sometimes you do not succeed if you take whole streets. This is not a worry with decarbonising, but trying to make money go around for the fuel poor is complicated. This is slightly disappointing, because it was talked about in the context of the Home Energy Conservation Act.
I will touch briefly on rural areas, to which my noble friend Lord Deben referred. As noble Lords know, I live in north Northumberland, which I think is even more rural than where my noble friend lives.
Baroness Maddock
Perhaps through e-mails.
Our problem is that a lot of properties are farm cottages. I go back to my worry about the private rented sector. My husband is an MP there and sees a lot of tenants. The farm cottages are often in the private rented sector because there are not as many farm workers. Trying to tailor all the programmes to do something to these properties, and in particular to get the landlords to do something, is very difficult. I have gone full circle and come round to the private rented sector, which I hope we will deal with.
I am pleased that the Committee has, within days, got something in response to our pleas last week. I thank the Minister for introducing the amendment.
Lord Hunt of Chesterton
My Lords, when we were discussing the previous energy Bill, I asked the Minister whether it included the word “ventilation”. Heating and energy involve insulation, heat and ventilation. The Minister asked the people behind him, who said that the Bill did not have that word in it. I was then assured that ventilation would be covered in secondary legislation or regulations. This matter is partly to do with ventilation. If it would be easier to accept the amendment by saying that it is an application of ventilation, which is part of energy, so be it.
Lord Deben
My Lords, we ought to help the Minister on this. I suspect that I know what advice she has been given, and it is important to warn her about it. I will express that warning very carefully.
In the 19th century there was a scandal when people bought wallpaper that had a colouring based on arsenic. Large numbers of people died. The Government consistently refused to outlaw arsenic in the manufacture of that wallpaper. In the end, it was the fact that people ceased to buy the wallpaper that stopped the damage. The Government did not change the law until 1974. Therefore, there is a history of Governments not doing what they ought to do at the time they ought to do it. I was fascinated to read some of the evidence that the Government gave about why they were not doing it. Noble Lords will not be surprised that the argument was, first, that there is no need for regulation in this area; secondly, that it will be expensive; thirdly, that there is no call for it; fourthly, that people ought to be able to make these decisions themselves; and, fifthly, that the science is not quite proven. Have we not heard those arguments before, and will we not hear them again?
I suggest to my noble friend that this is a genuinely serious issue that could be solved. Lives can be saved at a cost that is significantly lower than it used to be, because government is enabling people to go into these premises for all sorts of other reasons. If the Minister has been advised that it is inappropriate to have legislation in this area—of course, I do not know whether she has been—I would pick up on the comments of the noble Lord, Lord Hunt. Anyone who has a gas fire installed is always forced to install further ventilation, even if it is utterly unnecessary. We already have legislation of a very detailed kind. If you wanted to put a gas fire in this Room, even though it may be very draughty, you would have to put a ventilating spot at the top there because that is what the law says.
I am not suggesting that we should be in any way as prescriptive as that. We should not say what kind of alarm there should be, except to say that it should be effective, and we should certainly be willing to allow alterations to the text of the amendment, because I am not expert enough to know whether it would do the job. I hope my noble friend will understand that this is one of those issues in which everybody involved has to say to themselves, “Am I prepared to allow people to die when I could stop it?”. That must be of great importance. We have to ask ourselves, individually, as Members of the House of Lords, officers of the department and Ministers, “Am I prepared not to act when action will save lives?”. That is not acting in some extreme way, or some awful health and safety nonsense. The very simple fact is that modern equipment needs this. It ought to be part of the deal. No deal should be done without it. In other circumstances, it is precisely like stopping people working in unsafe conditions in factories. We do that as a matter of course.
Lastly, it would be quite wrong not to use the opportunity of the Bill to do this on the basis that there might be another opportunity, another Bill or another place. We can use this Bill—the provision falls within the Long Title. There is no reason why we should not do it here; it is an appropriate place to put it. I very much hope that my noble friend will accept what is a really valuable contribution and play her part—and ours—in ensuring that next year a whole lot of people who would have been dead are alive.
Lord Oxburgh
My Lords, I, too, support this amendment. After the eloquent contributions we have heard, there is little more to be added. I simply say to the Minister that if, in spite of the eloquence of noble Lords, she does not feel able to legislate for this here, when will the Government do so? Will she give a firm undertaking that legislation will be introduced? For the very reasons that the noble Lord, Lord Deben, gave, people are dying and we must do something about it.
Lord Gardiner of Kimble
My Lords, first, I thank the noble Lord, Lord Whitty, for tabling these probing amendments, as he described them, and therefore providing this opportunity to continue the careful scrutiny of this part of the Bill. I have listened carefully to what noble Lords have said. I believe that we all want to secure the best for consumers but suspect that we may diverge on how that is best achieved.
Amendment 51ZA would require the Secretary of State to bring forward regulations to allow collective redress for energy consumers. We agree that consumers should be able to get the compensation that they are due when things go wrong. The consumer redress order powers we have put forward in the Bill will provide energy consumers with what we believe is the most appropriate and cost-effective way of obtaining this. In principle, collective redress can provide benefits in some sectors, but I am concerned about the potential impact such powers may have on the time and cost involved for energy consumers seeking redress through this route, and the impact of any additional costs on all consumers.
The most effective redress mechanism ensures that consumers receive timely and cost-effective compensation, and I was particularly interested in what the noble Lord, Lord O’Neill, said about balance in these matters. Under existing arrangements, energy consumers can already obtain redress through the courts, but the legal process does not typically offer a quick or cheap remedy for consumers who have suffered a detriment. In part, the concern that I have about the proposals from the noble Lord, Lord Whitty, on collective redress is that it would not speed up the process; indeed, it may, perversely, lengthen it, although I am sure that is not his intention. Consumers will also be required to identify themselves as potential claimants and join an action. Consumer redress order powers overcome these barriers by allowing Ofgem to take action on consumers’ behalf, without them needing to initiate action or incur costs.
Allowing collective redress via these amendments would benefit intermediaries involved in bringing such cases, who will seek awards that allow them to recover their costs—which would be borne by claimants or, where costs are awarded, by all consumers as energy companies seek to recover these sums. Collective redress could also encourage litigation on fine points of law, creating higher costs for energy companies, which would again risk increasing prices for consumers as a whole. In contrast, the consumer redress order powers contained in the Bill offer a speedier resolution to consumer detriment, which does not require consumers to come forward and take action, is proportionate to the sums at stake and minimises the potential costs for all energy consumers.
The noble Lord, Lord Whitty, asked whether the Bill’s provisions cover regular breaches of consumer law. The intention is that they will. If the breach is also a breach of licence conditions, such as mis-selling, that would be included.
The noble Lord’s Amendments 51ZE and 51ZF would increase the time limit for consumer redress order powers contained in Schedule 14 from, as the noble Lord has mentioned, five years to 15. I naturally have sympathy with amendments designed to ensure that consumers can obtain redress. The intention is certainly not for these time limits to be arbitrary. The time limit is consistent with the existing time limit for Ofgem imposing penalties on energy companies. In some cases, both penalty and redress may be appropriate, and so it is important that the enforcement regime that we establish allows Ofgem to balance both penalties and redress when looking to put things right.
This five-year time period for penalties was introduced as recently as the Energy Act 2010, following, as the noble Lord will know, two high-profile cases which showed the limitation of the then one-year limit for Ofgem to investigate and take action. There has been no case involving an energy company either before or since where it is alleged that this five-year time limit would not have provided ample opportunity for Ofgem to take action.
Lord Deben
On that point, I declare an interest as chairman of the Association of Professional Financial Advisers. I say to the noble Lord, Lord Whitty, that very long periods allowing for what is by then retrospective action can have a damaging effect on the confidence of an industry. We have to be very careful to get this balance right. The reference to the financial services industry made by the noble Lord, Lord Whitty, is a mistake because many people now recognise that that has done and will do significant harm, and is against any sense of human rights. There comes a point at which those who have been involved are now so far removed from those who are operating that it does not make sense. Five years was chosen, and it seems not a bad choice. I hope that the Minister will resist any temptation to go further. I say that as somebody who has no interest whatever in energy provision companies.
Lord Gardiner of Kimble
My noble friend provides an excellent prelude to further commentary on why the Government are concerned about the extension to 15 years. There are indeed jurisdictions with longer time limits than those afforded to energy consumers though these powers. Of course, there are others which are significantly less. These variations reflect various factors, including the length of time required to detect and act on wrongdoing, the scale of the sums at sake and the likelihood of sufficient evidence being able to investigate and determine a claim.
The powers are drafted to balance—a word that was used by my noble friend—these considerations without placing unnecessary additional costs on consumers. My noble friend has mentioned business. We are certainly seeking to provide an appropriate balance to all these matters. For those reasons—although I can assure the noble Lord, Lord Whitty, that his amendments have been given proper consideration—I hope that the explanation I have given is sufficiently compelling at this time that he might feel able to withdraw his amendment.
Lord Whitty
My Lords, I find the explanation on the five-year period extraordinary. I think it was my noble friend Lady Liddell who mentioned that the notorious recent Scottish and Southern case had gone on for four years. It would not have needed to go on for more than another six months for it to fall foul of this restriction. There may be something in the argument of the noble Lord, Lord Deben, that you need some restriction. Indeed, that is why I proposed a 15-year period rather than delete the provision entirely. I do not accept that there should be a shorter jurisdiction for energy than there is for financial services, nor do I accept the argument put forward by the noble Lord, Lord Deben, that it is a bad thing for people to be entitled to redress for the mis-selling of, for example, PPI and pensions in the financial services sector which happened a long time ago, albeit that continued until relatively recently. As for confidence, there is no consumer confidence in the energy sector. It is all very well saying there will be no business confidence if companies think they are going to be fined for something which happened 15 years ago, but at the moment there is almost nil consumer confidence. The energy sector has the worst record among the allegedly competitive markets in terms of consumer confidence. That is partly because over time consumers have had difficulty understanding whether or not they have been misled or mis-sold products and have faced grave hurdles in trying to remedy that. Sometimes they have—
Lord Deben
For the correction of the record, the problem is that the further you extend something, the less you can prove the case, the greater the chance that the people who are now involved had nothing to do with it and the less the chance that the circumstances in which it took place can reasonably be identified. You have to have a balance; that is all. There are many examples of cases where the conditions that obtained 15 and 20 years ago are unprovable and very different from the conditions obtaining now. In the end, you have an unfair circumstance. Therefore, some way or other, you have to have a decent balance—otherwise, you find that people’s confidence and willingness to invest in industry reduces. That is the experience and that is why so many fewer people now provide services to the public than used to be the case. We have destroyed confidence. You have to have confidence on both sides; that is all.
Lord Whitty
My Lords, if something is unprovable, redress will not be awarded.
Lord O'Neill of Clackmannan
I should perhaps start by declaring an interest. I am chairman of SmartGrid GB. In some respects we will have an information overload as a consequence of the rollout of smart meters. On the other hand, it would be desirable for the rights of the consumer to be taken properly into account. It is quite likely that there will be a lot of information, and it would be a reassurance to the consumer if they had access to what was out there. Some of the enthusiasts for the new technologies, which have yet to be fully realised, find their eyes glowing at the prospect of smart metering. We have to be a wee bit cautious. There could be civil liberties concerns, although not about the time when you put on a kettle or whether you run the washing machine in the middle of the night. These issues are trivial.
It is a bit like another problem that we have at the moment. If we use our passes on the Underground, we could be tracked over the course of a day or a week. While that might be of use to some authorities, and might be used for beneficial purposes, it could be a problem. It will be the same when we get these new meters in households. I see the noble Lord, Lord Deben, looking at me, but I am sure that, in his experience of constituency surgeries, he had, as I had from time to time, individuals who were convinced that in a television set there was a camera as well as the receiver, and that somebody, somewhere, was finding out what was going on in their living room.
Lord Deben
The noble Lord is absolutely right, but we should not allow people to think of this just as a joke. Some newspapers will certainly try to suggest that this sensible proposal is a means of doing untold damage. Therefore, we must get it right from the beginning or we will destroy the whole system.
Lord O'Neill of Clackmannan
I remember being a lorry driver’s mate in the 1960s when I was a student. As a consequence of a Labour Government’s legislation, the haulage companies were trying to introduce the “spy in the cab”. That is now regarded as a very important health and safety measure. At the time it was not very well presented. If we can get an understanding and an appreciation by government of the dangers of the overload of information that could emerge, the public could be educated on the beneficial uses of it and made aware of the dangers—of which the civil liberties lobby could take account—the anxiety that parts of the press might have about the rollout of smart meters would in large measure be mitigated.
Therefore, while I appreciate the probing character of this amendment, it would benefit the process if the Government gave us positive indications today that if this is defective, or if it is otherwise necessary, amendments could be presented at a later stage in the appropriate format. We would do well to keep this in mind even if we do not get completely uptight about it.
Lord Hunt of Chesterton
I would like to speak to Amendment 51AA, which I tabled with the noble Viscount, Lord Hanworth.
I was not at Second Reading but I have been listening to some of the Committee’s sittings. I went to a meeting last week at University College Energy Institute which discussed the difficulties people will have—up and down the country—with the new Energy Bill, which has many laudable objectives. I recalled at this meeting the case of one noble Earl finding that his electricity statement was five pages long. My son-in-law, who works in a green energy company, comments on the great difficulties people have when installing new green systems: heating, insulation, flood-prevention, and so on.
So how are people going to understand it? There seems to be a feeling we are not yet, and perhaps never will be, a society that gets it all on the internet or from a phone call. Perhaps we need to go back to what used to be quite a familiar sight on the high street: the energy showroom. Not only could you see a range of electrical apparatus, you could show your bill to someone. These showrooms were the front office for the energy company.
Our suggestion in this amendment is that the Secretary of State makes adequate provision for the universal availability of information, in order to enable domestic energy consumers to make effective decisions about their energy usage, including information relating to installation, running costs and monitoring equipment— that last point refers to smart meters. People studying smart meters realise they are going to be a source of great difficulty to many people.
My suggestion, therefore, is that we should have energy showrooms up and down the UK’s high streets, where empty shops give organisations such as councils, the Government and energy companies the opportunity to provide places offering this sort of information. As I have explained, it is important that in these places there are people who can provide information.
Like all good ideas this idea builds on the wide variety of existing initiatives run by councils and voluntary bodies. However, the Government should take it as a general responsibility to encourage, where possible, and to provide funding, where necessary, to ensure that these energy showrooms, or information centres, become available. The idea is that in such a place you could not only see technology but make a decision about spending more money on insulation or on heating.
It is true that, under the Green Deal, there are approved operatives who can come and visit you, but that is a second stage. You would really like to see a rather broad overview of all the possibilities as well as having somewhere where you could find out about the bills coming through to you. We have been talking about fuel poverty, which is a complex issue and will be dealt with in many different ways. Again, you need a real person to do it. I know people who work in the CAB, and I fear that the CAB will be overloaded with people trying to ask questions about their energy bills. The effect will be such a big ramp, it will be necessary to have additional or separate places for energy.
One of the other points is who would do this. Well, there are lots of people out there seeking jobs. This would be a rather interesting, useful and perhaps economical, way for people who have technical skills, abilities and inclinations to provide this kind of information. Anybody working in such an energy showroom would of course develop skills that they could quite quickly apply elsewhere, so it might be a practical way of upgrading the skills of many people with a direct objective.
Of course, the information services are available on the internet and via helplines but, speaking for myself, I always much prefer to go and buy something from a shop and talk to a person. Although I am a computer person and use a Japanese supercomputer, when it comes to my bill I like to go and talk to somebody down the street. I am not sure if the noble Viscount, Lord Ridley, is in his place, but people like him who go down to their electricity showroom might also like to get some government information about climate change from approved sources. When you go to a doctor’s surgery you learn about your health and how to change your lifestyle, and you learn about science and medicine. Maybe we should be hearing a variety of views, but it seems to me that these would be climate change centres as well as energy showrooms.
Lord Deben
I was just wondering how the noble Lord would make provision for the views of certain people who find that most of the information given at these centres will be somehow or other not to be trusted? Will he have a special little place on the side with a notice up that says “Contrarians”? If so, will he take some care to ensure that what they have said had at least some connection with the truth?
Lord Hunt of Chesterton
I was going to suggest that, in an objective way, you present the official view but you might say that there are some areas where there are questions, as there are in science. However, I am sure that if these centres were formed, the Committee on Climate Change would be able to give excellent advice on how these centres might be used. The other point, as we learnt this afternoon, is the question of safety, including the safety of carbon monoxide and so on. Again, you could have that information at these places.
Secondly, as I have commented before in the House of Lords, I visit the Netherlands quite often—I am a visiting professor there. They have an excellent European energy centre where you can see a tremendous array of all the different kinds of technologies and energy developments available. Of course, in the UK we have the Centre for Alternative Technology at Machynlleth in Wales. There was one in Swindon. Surely we should have many more of these centres where people can make these really quite complex choices between windmills—if you are a Prime Minister, you have one on your roof—solar collectors, heat pumps, biomass generation and new kinds of insulation. Two critical issues are insulation and flood damage. We really need centres up and down this country where people can go and see them, funded and managed by energy companies, non-profit bodies and councils.
These two suggestions are building on what exists already. They are in line with the Government’s big society—going to meet your fellow citizens dealing with energy is surely part of that scene. I believe that all political parties would support this kind of initiative in order to get the whole energy and climate change movement going faster and with less concern to people, and that people would make use of it. DECC should take action quite soon.