Energy Bill [HL]

Lord Dixon-Smith Excerpts

Tuesday 8th February 2011 Grand Committee

[Lord Deben]

I oppose the amendment, first, because it suggests that the Treasury will be able to do things that even it cannot do. I am always suspicious of requests for the Treasury to do something, but this seems to go beyond the normal. In the interesting discussion between the noble Lord on this side of the Committee and the noble Lord, Lord Lea, on whether one situation is more elastic than another, we missed the important point: people make very different decisions, which are not necessarily connected with their income. Many of us have had the experience of canvassing in not the richest parts of constituencies and being hit by a wall of heat. That is in circumstances where people are clearly in the quartile to which the noble Lord, Lord Lea, referred. As I said, people make very different decisions. To ask the Treasury to produce some sort of documentation in which it applies these requirements to so wide a range of individual decision-making seems to me not sensible.

Secondly, the amendment does not fit into the whole context of the Bill and what we are trying to do. I say to my noble friend Lady Noakes that of course we want to have an effect on the consumer; that is part of what we have to do. However, the idea that there is some secret thing that we are not putting forward misses the point. The point is that we do not pay the proper price of our energy because we do not pay the price for destroying our climate. I know that my noble friend does not believe that the climate is changing, but most of us do. In those circumstances, we would do great harm to a future generation if we allowed people to go on treating energy as if it did not have these costs. Therefore, those of us who believe in a marketplace have to make sure that the market pays the costs.

We ought to be a bit bolder in telling people what we are about; that we are hoping to provide alternative means which do not destroy the future for our children and our grandchildren. The idea of trying to twist the argument in order to say that it is somehow unfair on a statistical fault is one that I have always found so difficult in politics. Of course it is true that if you have a smaller income, any increase has a bigger effect. It says nothing to say that. You can put up the price of anything and it is bound to affect those on the poorest incomes by its nature. That is not a statistical statement but a fact of life which is obvious to all.

The question is: can we take alternative measures in order to help those who are most hurt by this? However, you do not do that by providing even those very erudite people who clearly speak in the pubs of Burton with the material suggested in both these amendments. I cannot believe—although it may be true of Burton, it certainly is not true of any town that I know—that this would be the subject of discussion in the saloon bar, let alone the public bar. The fact of the matter is that there would be a general moan about the increase in prices.

We have to face the problem that if we are to deliver a world in which our children are able to live comfortably, we have to change our energy arrangements. In this Bill, we are doing that to help poor people to have the kind of housing which does not need as much heat. That is part of what we are trying to do and I hope that the Minister will be extremely robust in her reply to the noble Lord, Lord Lea. This seems to me to be both out of date and not a sensible use of Treasury time. I would like to see the Treasury getting down to understanding why on earth it cannot allow sensible borrowing from the private sector to improve energy efficiency. It pretends that that is somehow or other on the books when it could quite easily be off them.

There are a lot of things that the Treasury can be doing but it should not be doing this and we certainly should not kid ourselves that we either make these changes or, in fact, leave the world a worse place. I am a Conservative; I believe in passing on to the next generation something better than I have received. That is why I am very much in favour of this Bill and I hope that we will be really tough about the proposals in this amendment.

[Lord Dixon-Smith]

Perhaps I might intervene after my two noble friends, partly because I would like to introduce a little bit of hope. I should say to the noble Baroness, Lady Noakes, that in fact the consumer pays for it all. We should not duck on that. Even if they do not pay for it through their use of the fuel, they do so through their taxes. The consumer has to pay the total bill, one way or another. Of course, through the tax system we share the bill out a little differently from the actual consumption figures, which are what I really want to talk about. My noble friend Lord Deben brings me to my feet, because I want to look backwards instead of forwards.

The fact of my life is that in 1960, I paid one shilling and thre’pence and three-eighths of a penny for a gallon—that is, five litres—of farm red tractor diesel. Petrol prices were commensurate but the duty rates were of course higher. In the case of petrol, prices have risen as they have with red diesel oil but the duties have risen even further.

--- Later in debate ---

[Lord Dixon-Smith]

My Lords, I do not need to go back to the beginning. My point was that I was paying one shilling and thre’pence and three-eighths of a penny for a gallon of tractor diesel in 1960—50 years ago. I suppose I had better convert that to metric currency, as most people here are probably not familiar with one shilling and thre’pence and three-eighths of a penny. It was about 6.25p for a gallon of fuel or a fraction more perhaps than 1.25p per litre. Currently, the price is around 61p to 62p per litre. That includes an element of tax, which of course has gone up on that as it has on everything else. That, over my lifetime—or all our lifetimes—is an energy price rise of 5,000 per cent.

If anyone had stopped to think about that in 1960, they would have thought that the world would collapse. For sure, the noble Lord, Lord Lea of Crondall, has a point when he is concerned about the future. We need to be concerned about the rise in the price of energy and about the way in which that use affects people’s lives. Having said that, we have all lived already through enormous change and I see no reason to believe that we cannot continue to do that.

[The Lord Bishop of Chester]

My Lords, whether one takes the view that current government policies will lead to an unpleasant, unfortunate and regrettable increase in energy prices through the renewables obligation and so forth or one takes the line of the noble Lord, Lord Deben, who is not back from the vote yet, that this is all in order to save the universe, the public needs a certain amount of transparency on the issue.

Another reason it is important concerns the great increase in energy prices since the youth of the noble Lord, Lord Dixon-Smith, who must be even older than me if it was that cheap when he was young. The key question going forward is how energy prices in this country relate to energy prices in other countries. If such prices in this country get out of step internationally, that would have profound implications precisely for the people in the pub in Burton upon Trent who would find their jobs under threat if they were dependent on energy usage.

Whichever way you look at it, a consistent, annual process of reporting should be as far as possible value-neutral. We can all then make our minds up on a fair and accepted basis of available information, which is important for going forward. It would be very hard to say that that is available at the moment. As has been said, there is a great deal of confusion. One way or another, I do not doubt that this amendment is not right in its present form—perhaps this is not the Bill for it—but we need to have information or there will be misinformation. It needs to be a priority as we go forward with our energy policies.