Lord Teverson
Main Page: Lord Teverson (Liberal Democrat - Life peer)Energy Bill [HL]
Lord Teverson Excerpts(13 years, 4 months ago)
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Lord Davies of Oldham
My Lords, the purport behind the amendments is to clarify what will be included in the framework regulations. The Minister has used the open term “may” and we are concerned that he should be more deterministic in regard to the regulations. He should include the word “shall” in crucial places in the legislation in order that we are clear about the determination of the Minister and the legislation as to what the regulations will cover.
We want to be clear from the legislation what will appear rather than what will be at the Secretary of State’s discretion. The greater degree of certainty that we are able to establish within this legislation, the clearer the nation will be. This is important for everyone who is a participant in this ambitious agenda for ensuring the reduction of carbon content and for hitting the important targets. The more that is clearly determined in the legislation, the clearer the nation will be about our obligations.
We propose inserting “shall”, and I hope the Minister will take these amendments as an opportunity to give a clear definition of what he expects to be in the legislation. I am sure he appreciates that accepting our amendments would be the clearest way of communicating that fact to our fellow countrymen.
Amendments 5A and 8B seek to establish whether we are limited to the lists referred to in the legislation and I ask the Minister to clarify the position.
It would not become me to pre-empt the amendments which are to be spoken to by other noble Lords but we all recognise from the Second Reading speech of the noble Baroness, Lady Finlay, the importance of her amendment, which we support in principle. The amendment of the noble Lord, Lord Teverson, also brings forward a principle that we largely support. I beg to move.
Lord Teverson
It is a great pleasure to speak during the course of a Bill to which I have been looking forward for some time. I am glad that the Energy Bill is a priority in the Government’s legislation.
My amendments are minor but have an important effect. They reflect in many ways the debate that took place on the previous group of amendments. On page 4, Clause 3(7) refers to energy plans. We believe that it would be useful if we included energy plans as well as Green Deal plans within the same sections of the Bill. It would add greater clarity and ensure a more holistic approach to the way in which the Green Deal operates. A number of my other amendments circle around that broader theme.
In response to the noble Lord, Lord Davies, I should say that I cannot think of a better principle than that the Government should be clear. I like firm language as opposed to language which is not clear about its intent, and I welcome the amendments that will achieve that.
Lord Teverson
I shall speak first to my Amendment 8C. I am trying to be helpful to the Government, as is the noble Baroness, Lady Smith. Where the Government talk about withdrawing authorisation from Green Deal providers, there has to be an authorising body as there is a mechanism within the Bill for those organisations to be authorised in the first place. So there should also be a means, in extremis—we hope it would never be used—whereby authorisation can be taken away from those authorisers as well.
I tread carefully here, but on the amendments of the noble Baroness, Lady Smith, it would be almost impossible to disagree with Amendment 2D which seeks,
“to ensure that assessors and providers have the qualifications and skills”,
to perform their functions under the Green Deal. I question Amendment 2G, however. In my mind, the jury is out on this. I have a concern about this whole scheme in terms of quality. I know that this is not what the noble Baroness means, but I am concerned that we have moved towards some kind of tick-box assessment; that if you meet certain criteria, then everything is fine. It is more important in many ways that a level of intelligence is attached to these processes, in a similar way to consumer protection in the financial services industry where there is an overall requirement for suppliers to act intelligently in the overall interests of the customer. While there is a place for standard assessments, they do not always meet that quality element. When we are talking about a programme that is to be as large as we hope it will be, the quality element is of great importance. I am not sure whether just assessment processes with a list of issues completely fulfil that. I am not necessarily talking against the amendment, but I am very anxious that there should be a qualitative demand in the Bill that providers think intelligently and provide plans that are specific to households and people; and that assessors are not working to a completely standardised format but in terms of whether a quality product will be provided within that market.
Lord Jenkin of Roding
My Lords, I have sympathy with what the noble Lord, Lord Teverson, has just said, particularly about Amendment 2G. When one thinks of the enormous range of the buildings that are going to be subject to the Green Deal process, it is with the utmost difficulty that one imagines how one could have a standard assessment measurement. What one looks for are sufficiently skilled and trained assessors who can look at a widely differing range of buildings and use their skill and judgment, in the time-honoured phrase, to come to a conclusion and make an assessment. We will come to this in Clause 4, where the requirements are very fully spelt out.
The idea of a standard assessment seems to me to inevitably result in a “tick-box” culture, which has been an unpleasant factor in so much of what one faces in modern life: people feel it is sufficient simply to tick the boxes. If we are going to have fully trained and qualified people—an objective I totally support—then we must rely on their skill and judgment to decide on the appropriate assessment for the hugely differing range of buildings with which they will be confronted. One would expect there to be assessors who specialise in particular kinds of buildings, because they will have the experience and expertise to deal with them. I am therefore unhappy with amendment 2G.
I have given training a good deal of attention over the past year or two. I believe that the present Government and BIS have produced a splendid blueprint of what they envisage the process of skills training to be. There is no question that the skills training system which operated under the preceding Government left much to be desired in achieving results. I declare an interest—as I have before—as the president of the National Skills Academy for Nuclear; I have also been involved with Cogent and a number of others. I have had dealings with Energy & Utility Skills, a highly effective body. It was the one—I raised this on the Floor of the House before the election—which tried to fit in to the national scheme for training people to install smart meters, and was firmly told that it could not have help with that. I am happy to say that Ministers in the present Government have addressed this problem fully. If we are to make a success of that—we may come to this later—there must be a proper system for training people to install these meters.
We need to keep a careful eye—this is a key stage in the whole Green Deal process—on how the training of the assessors will be handled. If my noble friend can give us some more information, that would be very helpful. Yes, we are going to have a code, and we will come to that later under another amendment. But I think this will be a key part of the whole process.
I have referred before to the fact that I had my house installed under the old CERT scheme, and it was an unhappy experience: one simply ran into the sand. At first I went through the Energy Saving Trust, and that became completely futile, so I started again with my own supplier. In the end that produced a solution, although an expensive one, as I had to pay for all the scaffolding, which was very tiresome. But I was satisfied in the end that the expert who came from British Gas to decide what my house needed was highly qualified and that the installer was able to do a good job. Those are the key things which will generate confidence in whether the Green Deal scheme will take off as we hope it will. This is an important requirement, which hinges on skills and training, and not on standard assessments.
Baroness Smith of Basildon
My Lords, I am grateful to the Minister. I welcome the approach that he has taken throughout this Committee. He is taking on board comments that have been made today, and I know that he will take them back and perhaps we will see some changes at Report. I just grinned when he talked about the code of conduct because—I do not know whether the noble Baroness, Lady Noakes, picked this up—he said that the code of conduct “must” set out the qualifications and skills. At the moment it does not; it only says it “may”. So I welcome his change of language to “must” set out the qualifications of skills, rather than “shall”, as my amendment suggested.
It has been a useful debate, and I always defer to those with greater knowledge on issues. I do not think that there is much difference between us. All of us agree that those undertaking the work, whether assessments or installation, have to have the appropriate skills and qualifications. It is entirely appropriate that although they are accredited in some way, that can be withdrawn. But the reason for raising the issue of standard assessments was not to propose a tick-box procedure—although there will undoubtedly be some kind of tick-box procedure—or uniformity of the work that will be required. However, the issue has been raised. The National Housing Federation raised concerns that the current assessment—I think it is the SAP—does not always work. I was trying to get to a consistency in standards of measurement.
Given that the Green Deal, in terms of what work can be undertaken in a home, has to be cost-effective and follow the golden rule, some kind of standardised assessment to understand what fulfils the golden rule in that way, if the savings have been made, and some sort of consistency, will be required. That is of interest to customers. So I am not suggesting that every house needs to have the same installation and the same work done. There will have to be intelligence taken on board by those installing. However, a lot of the measures will be very safe, and it would be a somewhat ludicrous position if two houses next door to each other were both given different ways of achieving it. It brings us back to the issue we had around the Green Deal plans and the energy plans because, under the Green Deal plans, it could be the same work but with different ways of achieving the same objectives; and the decision would be taken by the assessor, not by the householder. I think that is an issue of the householder having confidence that the assessor is given the correct information.
Lord Teverson
I thank the noble Baroness for giving way. I would like to make an illustration there, which may come on to something later on. She mentions that two houses together should not have different solutions. The big challenge is that both those houses, and probably the rest of the street, are assessed as a whole, and a better solution of the 20 houses has made them the one or two. That is why I have a slight concern about too systematised an approach. I think the noble Lord, Lord O’Neill, made a magnificent case for a degree of that approach; but I think that that point illustrates that, if it is too tram-lined, then we can get into too much trouble, and I understand she is not saying that.
Baroness Smith of Basildon
I am not suggesting that it should work on tram-lines, but there will need to be a consistency that is understood. The other point is that there should be some kind of guidance and standard of assessment. The noble Lord, Lord Jenkin of Roding, said in his comments that assessors will have particular expertise in methods of insulation or whatever. There is a concern that assessors may be linked to a particular company and may want to promote the products of that company and a particular method of energy efficiency. That is something that I think all of us want to avoid. The assessor should be free to look at any way in which you can promote energy efficiency or maximise energy efficiency in the home. I hope the noble Lord can take these points away. There needs to be some consistency in the standard that is required. If we can reach that through the level of skills, qualifications or training, then that would be appropriate. We will always want to ensure that the consumer comes first, and the consumer can be assured in all cases that they are getting correct and accurate information. I beg leave to withdraw the amendment.
Lord Teverson
“Protection for improvers
The Secretary of State shall have a duty to ensure through regulation, code of practice, and audit that improvers are protected from any collusion, anti-competitive activity, or being offered restricted options that favour particular products or organisations, on account of arrangements or agreements made between green deal providers whether advisers, installers, providers of finance or energy companies.”
Lord Teverson
My Lords, the amendment concerns a matter of principle. When reading through the detail of the Bill I had some difficulty in understanding exactly what protections there are for consumers in this system given that there are a number of different actors in the providers of services. We have the finance companies, I presume; the assessors; the experts who go out with or without their tick boxes; and the people who draw up the green plan or the broader energy plan. I am concerned about consumer confidence, about which the noble Lord, Lord Whitty, talked so well. There is a need for the legislation to contain a duty to ensure that there is no collusion—or even laziness in a negative way—which prevents consumers getting the best deal.
I do not believe the Competition Commission would be interested in this level of transaction, nor, I suspect, would it come under local authority trading standards. I will be interested to hear from the Minister how the Government see this area and what legislation they will bring forward to make sure that the various actors on the supply side provide the best deal for the improver; that there is not in the supply chain a person making sure that a particular building supplier always gets the right business or an assessor who makes sure that the person who draws up the energy plan is not always the same person.
Having said that, I understand that this is a complicated area. Clearly relationships will build up. It may be good that particular organisations and individuals work well with others within the supply chain but I am concerned that the consumer’s interest is protected. Hence the amendment seeks the Secretary of State to have a duty to ensure that there is no collusion, either by design or through laziness, that delivers a less than optimal solution for the consumer. That is what the amendment is about. I am sure that any public Bill writer would be appalled by the state of the language and what it says, but I have tried to put it in plain language so that the Minister can come back and say to us how he feels this area should be approached within the context of a green energy plan. I beg to move.
Baroness Smith of Basildon
My Lords, I support the principle of what the noble Lord, Lord Teverson, is seeking to achieve. It is not dissimilar to the point I made earlier about whether there may be arrangements or relationships between an assessor and an installer whereby the assessor will always want to give business to a particular installer for the work to be done. It is difficult to ensure that there are not such arrangements and the wording of the amendment puts the issue back into the Minister’s court to see how best this can be achieved. It is an important objective to consider because, as has been said a few times during the course of the debate, protection of the consumer and consumer confidence are all important. If the consumer thinks that a certain assessor will always go for particular kinds of products or arrangements, it will not lead to confidence in the Green Deal. I hope the Minister will take on board the principle, understand the point that it is seeking to make and consider ways in which it can be addressed.
Lord Marland
I think that noble Lords are looking at this in a narrow sphere. I am not familiar with parts of the world where there is only one supermarket chain operating in that part of the world. I take the view of the noble Lord, Lord O’Neill. In my part of the world, there are four or five operating quite regularly. If you add to that B&Qs and the suppliers of all forms of household improvement, it multiplies. Therefore there is distinct competition. You have to add to that the energy companies, social enterprises, housing associations and all manner of retailers who can ensure that the market is competitive. I totally take on board what the noble Lord, Lord O’Neill of Clackmannan, has said, that it would be terrible if there was only one supplier in a part of the world. However, given the extent of suppliers that are available, I do not realistically think that market forces would apply.
Referring to the interesting point raised by the noble Baroness, Lady Smith, I am not entirely sure that I follow. If her point is that the double-glazing salesperson was promoting a product that was exclusively to their benefit, I am not sure that this would happen because market forces would dictate that anyone inviting someone into their home to give an assessment of the requirement and the cost of it would automatically put that out to tender. Even if these people were inappropriately selling the product, they themselves, before they are allowed to sell that product, have to be authorised under the scheme; and the scheme, as we have already debated, will have many a safeguard and recourse against unauthorised behaviour by an authorised provider or assessor.
It comes back to the central theme. We have to get these right, we have to ensure that the standards are properly maintained, and we have to ensure that competitiveness is allowed into the market.
Lord Teverson
How do the Government see the status of assessors? Does the Minister see them as being like independent financial advisers in the financial world? Can they be employed by B&Q or Everest? Can they actually be employees of those organisations, and can that be made quite transparent? Do they have to be self-employed? That is what I am trying to get to the depth of here. It is not in any way a criticism. It is actually trying to understand how this works in practice. I come back to the financial services industry or even—dare I say to the noble Lord?—the insurance industry. There is a whole history of mis-selling despite strong regulation, perhaps because people got commissions—I would be interested in comments in terms of whether commissions are permissible under this system. There are clearly advantages to the upfront sales force or the people who recommend because there is a temptation, under certain circumstances—which may not be illegal but might be dubious or not in the interests of the customer—not to recommend the best solution necessarily, or a particular solution. Most people will not want to get more than one assessor. They will want to get an assessor who they see as independent of mind, maybe through a proper assessment process or not—coming back to the previous debate. I am interested in how the Minister sees the status of assessors. Can they be a full-time employer, employee or an organisation that tends to specialise in certain solutions? I am just interested in how the Government see that working out in terms of a code of practice or maybe in the way that this scheme has to operate, because I believe that it is fundamentally important.
Lord Marland
My Lords, there is nothing to prevent an assessor working for an organisation, but the reality is that they have to be independent of that organisation in terms of their assessment. There has to be a Chinese wall. To answer my noble friend Lord Teverson’s excellent question, assessors can come from all walks of life. They could be quantity surveyors, representatives of B&Q or representatives of a supermarket, but they have to retain an independence and fulfil the standards that are required of them under the Green Deal regulatory mechanisms that we have been debating today.
I would also point out that a lot of the products that we are talking about here are not new to the market. It is not as if we are suddenly coming into the market with a wonderful new product. Double-glazing has been sold consistently through the country for a long time. Loft lagging has been consistently sold, and there are consumer protections in place under the Act which provide for proper regulation.
There is one point which I would like to reflect on and come back to my noble friend Lord Teverson on, however, and that is the role of commissions. My noble friend has raised a very important point where we need to work out the impact and how these assessors are remunerated.
Baroness Smith of Basildon
I have listened carefully to the Minister. I think that he is trying to reassure noble Lords on this important commission point, but I am not reassured. Clause 3(4)(a) to (g), on the code of practice, would seem to allow an installer to employ an assessor, and to allow that assessor—within this code of practice, this framework arrangement and the Green Deal—to recommend energy efficient measures that fall within the remit of one installer that is employing that assessor. I do not understand how an assessor can be employed by an installer and be independent. I am grateful that the Minister will look at this again. However, depending on what he comes back with, we may wish to return to this at a later date.
Lord Teverson
My Lords, I thank the Minister for going through this and perhaps spending more time on it than he would wish. However, I think it is a core part of making this system work and putting it above question. Public money is not involved but we are talking about consumers’ own money under a government scheme. That is why it is particularly important. I was going to offer to look up the various bits of competition legislation that he mentioned but I suspect that I will not get round to that before Report.
I thank the Minister for looking into this area. It would be useful for the department to explore this and to have a clear view on how it will work to avoid what I would call mis-selling within the market place. I beg leave to withdraw the amendment.
Lord Teverson
“Duty of green deal providers
(1) It is the duty of green deal providers to ensure that the energy plan reasonably reflects the best overall energy solution or solutions for that property, while also taking into consideration the total cost, and the period of payback of any scheme.
(2) Green deal providers must be able to show evidence that they have taken due care to promote the best interests of the improver.
(3) Where appropriate, suitable options should be offered to improvers so that they may make a choice.
(4) An energy plan must include an estimate of the annual savings of carbon dioxide emissions.”
Lord Teverson
My Lords, this is another broad and, in some ways, probing amendment. I have gone through the Bill. The Minister might be able to put me right but I could not see anywhere that there was an actual duty on the Green Deal providers to make sure that they actually provided the best deal that there was available. I then had to think what is the right deal to put forward in order to write this amendment. Even with the broad strategic messages that I had written down, that became quite difficult.
It is important that it should be made clear in the Bill, which is the primary legislation, that there is a duty on the Green Deal providers, who are in a position of preference—and I was going to say that the noble Lord, who is not here any more, used the right phrase—to make sure that it is the best deal. What is that? I believe that they need to show some sort of documentary evidence—and we again come back to the assessment argument or the list one way or another—in the way that financial services providers have to, that they have gone through certain processes, not just generic ones but ones to do with the situation of the property and the household itself. This is not just about property. It is in a way about what that household can actually afford, or the payback period in which they can work. There are variations within the golden rule. The golden rule must be met, but it perhaps can be met in a number of different ways. There is a duty of care here.
I would like to think that there was also, where possible, options and choices—not too many, not too complicated and not for their own sake—and that there should be some ability to have a discussion about what is the right solution out of a number of possibilities. I also believe that, for the energy plan that is agreed, there should be, at the end of the day, a carbon emissions statement that brings that area back into the consumer’s view. Why are we doing all of this? It is to save energy and to be of benefit to the consumer and the household individually. However, it is also very useful to illustrate on the plan that this is also about decarbonising the economy and reducing carbon emissions.
In this amendment I am trying to make it clear that—again, I quite understand that there is a complicity below this—there is a duty on Green Deal providers to make sure that households are able to make good decisions from good information. In a way it comes back again to that debate that we had before. It is very important that there is not just a quality check in terms of assessors but that they have to use their grey cells as well as just a checklist to make sure that the scheme that is put forward is a good one. I would like it to look beyond the Green Deal issue.
Lord Moynihan
I begin my intervention by apologising that I was not with you at Second Reading. Unfortunately, the challenge of London 2012 and the Olympic Games took precedence on that occasion. However, I shall be pleased to be with you during as many hours of the Committee stage of the Bill as possible.
Is not the point that my noble friend is making absolutely key to the discussions that we were having earlier on the subject of accreditation and certification? I ask him to focus on that because it if we can get the accreditation and certification system right, along the lines that my noble friend was discussing on an earlier amendment, we would go a long way to ensuring that we achieve the goals and objectives that my noble friend has set out.
Lord Teverson
I agree with my noble friend entirely. The quality of the assessor is most important, but that has to be supplemented by the duty of providing good information or a good plan as well. On that basis I beg to move.
Lord Jenkin of Roding
There is both good and bad in this suggested new clause. The point about the first three subsections seems to me to be inherent in the nature of the scheme. However, I do not know whether this is the right way to make clear that the scheme is intended to give the consumer, the householder, the best deal available. I am sure that there will be many circumstances where the assessor will have to weigh up the situation and say, “Are we asking too much?”, which means that it could not be paid back within a reasonable time; and, “Are we asking too little?”, which means that the householder could have paid rather more. This may need to be written into the Bill in some form. With the use of the words,
“the best overall energy solution”,
you are opening up the possibility that someone will sue if they can be persuaded that they could have got a better one. Somehow one has got to try and avoid that. That is the good part.
Subsection (4) is totally impractical and undesirable. As I said at Second Reading, one of the great advantages of the Green Deal over the CERT programme is that this is not written directly around carbon savings but is intended to provide the householder—the consumer—with incentives for lower bills and warmer houses. To require that in every individual case someone has to sit down and estimate what the carbon savings are likely to be seems to me to be unrealistic. I apologise to my noble friend for using what may seem to be fairly strong words, but everyone has recognised that one of the advantages of this is that people may choose to have warmer homes and pay back rather more because they will not get as much savings as they might have had had the whole thing gone into saving energy costs. How is anybody going to conceivably estimate that at the outset?
We have a classic case here where the carbon savings, which certainly lie at the heart of this in order to achieve our carbon targets, are the consequence and not the primary objective. As I said at Second Reading, people will respond much more easily and readily to an offer of lower bills or a warmer home than they will to someone coming along and telling them that they have to cut their carbon footprint. Subsection (4) is very difficult and I would find it hard to support if it were to find its way into the Bill.
Lord Marland
My Lords, this is an interesting amendment. The question raised by my noble friend Lord Teverson of what is the best deal remains unanswered, because a best deal to some people is quality; to others it is price; and, arguably, the best deal to most is a combination of quality and price.
Amendment 10 seeks to introduce a new clause addressing consumer protection mechanisms. While we accept the thrust of the amendment and what it is trying to achieve, I believe that the issue is already addressed in Clauses 3 and 4. Clause 4 is central to the Green Deal and defines the terms on which it can be offered to customers. I urge noble Lords to look at it again. Subsections (2) and (3) require that an accredited Green Deal assessor has assessed the property in accordance with the standards that we set out in the framework regulations and has recommended energy efficiency improvements on this basis. The assessor would identify the potential for energy savings using the standardised methodology as set down. The outcome of the assessment would be provided to the improver and would be used by the provider as the basis of an offer for Green Deal finance.
Subsections (4) and (5) require that an accredited Green Deal provider, the body seeking to contract the work, should give the customer an estimate of the savings on energy bills that are likely to result from the proposed energy efficiency improvements and over what time period these are likely to accrue. The Green Deal provider is required to base his estimates on a standardised methodology to be set out in regulations, thereby ensuring consistency and rigour in the process.
In addition, Clause 3 sets out requirements for the code of conduct which will make provisions as to the qualification and training of Green Deal participants. This will ensure that Green Deal participants operate to competent standards. We will look to see what, if any, further requirement should be placed on Green Deal providers to ensure robust consumer protection. We will set out these conditions in the code of conduct.
Lastly, I believe that we have the flexibility to make requirements in secondary legislation to enable us to move swiftly to close any loopholes that may become apparent once the scheme is operational. Paradoxically, agreeing this amendment for primary legislation could lessen our ability to protect customers. I believe that the Bill already contains the necessary provisions to achieve what is intended by the amendment and I would ask the noble Lord to withdraw it.
Lord Teverson
I thank the Minister for going through that explanation. He is right to say that there is a list of provisions within the Bill that point in the direction of the right quality of decision-making and of ensuring that all the procedures are right. However, I am not sure that there is a duty to get the right deal for the consumer at the end of the day. However, I note the Minister’s intention that that should be the case, as I am sure we would all want. Perhaps I can ask him to look at it again.
I should also like briefly to reply to my noble friend Lord Jenkin of Roding. My amendment makes it quite clear that subsection (1) is concerned with overall energy solutions and that subsection (4) is concerned just with an estimate, which I do not think would be very difficult to make. I know the Minister has exactly the same objectives here and I hope he will look at it again. I beg leave to withdraw the amendment.