Energy Bill [HL]

Lord Jenkin of Roding Excerpts

Tuesday 8th March 2011 Lords Chamber

[Lord Lea of Crondall]

I will take another three minutes as a compromise, if I may, because I am not there yet.

Carbon capture and storage is another good example where lobbyists say that they need to give confidence that they can recover their up-front costs. That is in fact a demand for an open-ended subsidy. I could go on. Those are all difficult questions to put into the jigsaw puzzle that the statisticians have to put together. We cannot just have random subsidies all round.

I could mention the electricity market reform proposals, where there are four options—the noble Baroness, Lady Northover, will be pleased to know that I will not read them all out. How many people in this country —how many people in this House—know about them? If we are talking about baseload nuclear and the problems of making wind power work, we cannot shut down wind power, so will nuclear have to shut down when the range of electricity use between the summer night and the winter night is between 25 gigawatts in summer and 50 gigawatts in winter? What will the rules be about that?

I make my last point. We may think that this is complicated, but it is against the background of a spike in the world price. We must be clear which is the world price effect and which is domestic subsidies for people in the street. That is essential politically. I hope that no one thinks that I am talking in a partisan sense. It can mean less need for higher indirect taxation if people take the view that the important thing is the reduction of carbon growth, but the Treasury will not be keen on seeing that as a scope for lowering indirect taxation.

I am on my last thought. I am very pleased that the noble Baroness, Lady Northover, in our last day in Committee, said that she agreed with a few ideas in my amendment then—there were some things with which she disagreed, which I have therefore taken out. The Government are ticking the box of transparency. Secondly, they are taking the first tentative steps to what I call saleability. We still have to jump the next fence of how to get a high degree of responsibility around the country. That is the signal, which I hope can be taken on board, that there is a good deal of convergence on the view that the approach of the amendment is rational and reasonable. It is very much in the Government’s interest, as well as the wider public interest. I hope that the Minister will now, having heard about the rationale and future adjustments that can be made, give careful consideration with her colleagues before the Bill reaches the other place.

[Lord Jenkin of Roding]

My Lords, the noble Lord, Lord Lea of Crondall, has adumbrated a number of very important issues. I do not dispute that for a moment. It was not altogether easy to follow all the details, but there is no doubt that we have been moving through a consumer revolution in how energy is priced and sold, and the impact of that on the population at large. There are clearly attractions to the noble Lord’s proposal. He mentioned the new green economy council. I, too, have studied the proposals for that and welcome that initiative. We look forward to seeing what comes from that. I am not sure how far that differs from the forum that he proposes in the last paragraph of his amendment.

The noble Lord’s amendment goes very wide. It covers not just prices but taxes and the whole question of the impact on different sections of the community. There is a need for more clarity on this. I cite just two examples. In case some noble Lords feel that they are being singled out, I shall not mention any names. I find it absurd that people can in two successive amendments or speeches demand that this or that renewable should be supported by the renewables obligation certificate—which, as we all know, is fed straight through the supplier companies and falls on to the bills of consumers—and then in the next amendment set up a great cry of woe because of the impact that this will have on the fuel poor. Some people do not seem to have been adding those two things together and realising that there must be some conflict between them: to ask for more subsidy and say that they are very sorry that it will put the price up.

I agree totally with the noble Lord that there is a need for more public understanding of what this is all about. I give another example very briefly. When the Secretary of State for Energy and Climate Change made an extremely important Statement last October heralding electricity market reform—the noble Lord referred to that in his speech—he drew on the paper published by the department last July entitled Estimated Impacts of Energy and Climate Change Policies on Energy Prices and Bills. At least, I think he was drawing on that. However, there was a freedom of information appeal to the department reported in the Times this January. The headline read:

“Energy shake-up will lift electricity bills to £1,000 in 20 years”.

That may be a massive exaggeration; I do not know, but there are great uncertainties in all this. That seems to be what the noble Lord, Lord Lea of Crondall, is seeking to identify and to provide a process whereby there can be more public understanding. I am sure that we would all applaud that.

The noble Lord proposes to add a major measure, or series of measures, to this Bill, which is quite specific. The Energy Bill is primarily dealing with the Green Deal.

[Lord Lea of Crondall]

I have a problem with what the noble Lord said. Is he suggesting that the Table Office did not think that this amendment could be made to the Bill?

[Lord Jenkin of Roding]

If the noble Lord will just wait a moment, that is the point that I am coming to. I think there is a lot in what he said, but I find it extremely difficult to see how we could add at virtually the last stage—although he raised it in Committee and mentioned it at Second Reading—a series of major proposals.

[Lord Lea of Crondall]

My Lords—

[Lord Jenkin of Roding]

The noble Lord must allow me to finish my sentence. How could we add a major series of constitutional and economic innovations which would clearly need infinitely more discussion? The House is extremely full at the moment, and we could go on discussing this for some time, but it is not for this Bill. I hope that the noble Lord will find other opportunities to bring this forward on other occasions, because there are many things that could be discussed; but at the moment, at this stage—on the last day on Report; we will have Third Reading next week—I just do not feel that we should accept this amendment.

I do not know what my noble friend is going to say from the Front Bench, but I think that it would be a somewhat bizarre action for this House, at this stage of the Bill, to add the very far-reaching amendment that the noble Lord has tabled. He has spoken to it eloquently and explained what he is trying to achieve. I have indicated that I think there is much merit in that for generating public understanding. However, I would advise the House against trying at this stage, with what would inevitably be a comparatively limited debate, to add a wholly new process of government in order to fulfil the requirements of the amendment. I just do not think that we should do that.

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[Baroness Northover]

I remind the noble Lord that he will have the opportunity to respond to all the points made in this mini-debate at the end of the debate, after the Minister has replied.

[Lord Jenkin of Roding]

I shall finish my speech, as I gave way to the noble Lord to allow him to make his intervention.

I am not complaining that the amendment is placed at the end of the Bill. Of course the noble Lord has placed his amendment where it appears to fit. I am concerned that he is proposing a major series of changes to the whole way in which all the organs of government—the Treasury, the Office for National Statistics and all the others—should conduct themselves, and a new forum to examine the assessments. With the greatest respect, I do not think that this can be added to a Bill of the very specific nature that we have before us.

[Lord Deben]

My Lords, I hesitated to break into my old mentor’s speech, but I want to agree with him and to say to the noble Lord, Lord Lea of Crondall, that in his speech he proved why this is impossible. In this amendment, the Office for National Statistics is supposed to publish all this in an easily assimilable form. Your Lordships' House might suggest that after listening to the noble Lord, Lord Lea, it is quite difficult to feel that it would be easy to produce an easily assimilable form.

The second thing I would say to the noble Lord, Lord Lea, is very important. It is always true that the poorer you are, the more heavily any imposition weighs upon you. It is not new to say that a particular sum is heavier on somebody who has a small income than on somebody who has a large income. That is why it is very important in the way in which we deal with these matters to see that it falls as lightly as possible on those who are least able to bear it. To spend a great deal of time producing this material in a form that I fear will not be easily assimilable and will probably not be read by the very people for whom it is intended does not help this issue. This issue is that in everything the Government do, in everything the coalition do, they have to seek to do it in a way that is as equable as possible. I say to your Lordships that we are already placing huge responsibilities upon the system of government, and to add to those this very detailed, extremely expensive and, I have to say, probably not used collection of new statistics without any real indication that it is going to be of any practical value is unnecessary not only at this stage of the Bill but at any stage of the Bill.

Finally, the thing we should be concentrating upon is enabling individuals to influence their spending. That is what matters, not what the Office for National Statistics says. Individuals should be able to see how much energy they are using, how they can best prevent that energy being used, how they can opt-in to the Green Deal and how they can make their lives more comfortable and happier. That is what we should be concentrating on. We should be moving away from this determination constantly and centrally to mull over, reproduce, redo, represent and reargue all these cases and get down to the real issue. How does Mrs Jones do something about her own energy use? How does she make her home more energy efficient? How does she know when she is using that energy? How is she able to take advantage of lower tariffs by, for example, doing her washing at a time that is not a peak time? All those things demand the fast installation of smart meters. I hope they will not be prescriptive but will merely say what they are supposed to do rather than how they do it. I hear some rather unnerving information from the ministry that sounds as though it wants to be terribly detailed about it. I hope it is not going to be like that. That is what we should be emphasising: helping individuals to make choices that benefit them rather than providing a lot of statistics that I suggest will be read by nobody. If they will be read by nobody, they will do nobody any good.

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[Lord Lea of Crondall]

My Lords, I hope that I do not have to come back in three years’ time because there are riots in the streets and name all noble Lords who said that this did not need to be done. There will be great anxiety in the everyday lives of people because matters will have got mixed up in their minds about the obligation. I am sorry that the noble Lord, Lord Deben, is now so intellectually confused that he does not remember that it was he, following Kyoto, who brought in a degree of hypothecation whereby we are transferring funds to mitigation in Bangladesh and so on. These are all part of the deal. It involves a huge amount of money, which soon will approach $500 billion a year. Therefore, people should have a chance to understand.

I am afraid that everyone from the noble Lord, Lord Jenkin, on has contradicted themselves and has made totally inconsistent remarks. It seems that if people do not understand the statistics, presumably that is their fault and the poor dears will never be able to understand them. We should put the statistics in a form that people can own and understand, giving them a picture of the problems, and reasons for the price increases, that they can accept. I do not know whether the noble Lord thinks that he is living in ancient Athens, but we have a wider electorate than they had there.

[Lord Jenkin of Roding]

I think that the noble Lord has totally misunderstood what I said. I went to great pains to indicate that I thought that the noble Lord, Lord Lea, had raised a number of extremely important points. My only argument, which has been supported by other speakers around the House, is that this is not the right Bill in which to do it. There needs to be much more discussion and probably a separate Bill—perhaps the next energy Bill.

[Lord Lea of Crondall]

On that point we can both read tomorrow’s Hansard to check who used which argument. Certainly, the noble Lord, Lord Deben, and, I think, the noble Lord, Lord Teverson, deployed the argument—no doubt one of them will put their hand up and say whether it was them—that this is an expensive statistics-gathering exercise. I do not think that we are talking about gathering more statistics, which are very expensive to produce. We are talking about £60 billion or £80 billion. What a ridiculous argument.

I hope that Ministers will think about this proposal before the Bill goes to the Commons and that our opposition colleagues in the other place will want to take it forward. We are moving into a dangerous area of potential misunderstanding. We have a huge spike in the world oil price and on top of that an alternative between a carbon floor and a carbon tax—not exactly the same thing—both of which will be regressive.

I am sorry that the noble Lord, Lord Oxburgh, is no longer in his place because he made a sweeping statement of socioeconomic doctrine that we should achieve all this through original income distribution and not try to help people with their home heating Bills. I do not know what responsibilities he has had in the world of meeting actual citizens—he is a very distinguished scientist—but we have to look at the wider public interest and the acceptability of peaceful governance of this country. I think that there is something like that in one of the prayers that the right reverend Prelates read from time to time. Something along those lines at least is in the Book of Common Prayer of the Church of England. That argument is a total red herring at this stage. It has been put down as an amendment just like the amendments of the noble Lord, Lord Jenkin. We will have to consider what to say at Third Reading.

Things are changing fast. In another astonishing aside, the Minister said words to the effect that we are rushing things. For a coalition, which has an agreement to change the world, the constitution, the Parliament, the way in which we elect people, this dog’s breakfast of the Public Bodies Bill, and a long list of other things coming forward, such as the health services Bill, to say that we cannot take these measures in this sort of timescale is not a very telling argument.

In my opening remarks, I made the point that this is not a partisan amendment at all. I am very sorry that the Minister felt that he had to say that this mess, or words like that, has been inherited from the Labour Government. That is ridiculous. Things are happening all the time. We have the world oil shock and the new EU framework, which I understand is about transparency and subsidies as regards renewable energy. All these things are happening and we are trying to get ahead of the curve. All that I can say to noble Lords is “Mark my words”. For the moment, I beg leave to withdraw the amendment.