Cost of Energy

Mike Reader Excerpts

Tuesday 11th February 2025 Westminster Hall

[Mike Reader (Northampton South) (Lab)]

It is a pleasure to serve with you in the Chair, Mr Western. I thank the hon. Member for Bath (Wera Hobhouse)—a fellow member of the Energy Security and Net Zero Committee—for introducing this important debate. We have been doing a lot of work over recent weeks in the Committee on energy pricing and the cost to consumers, so it is very timely.

It is clear that the Government have an ambitious plan to achieve clean power by 2030. For families in my constituency and across the country, that mission is really about lowering energy bills. Quadrupling offshore wind, tripling solar, doubling onshore wind and getting projects such as Hinkley over the line and operational are all critical things that will ensure resilience in our energy markets. Importantly, they will also protect UK consumers from volatile foreign markets, taking back control from Putin and petrostates, and placing the power of energy in the hands of British people. Those targets represent the biggest expansion of renewable energy in our history, and could save families hundreds, if not thousands, of pounds a year on their energy bills.

I recognise the great points made by the hon. Member for Bath in her opening speech, particularly on innovation in the sector. I also welcome her thoughts on heat pumps because I, too, believe that more than just heat pumps can solve this crisis, and it was positive to hear her talk about heat batteries. I want to add to the debate by speaking more about the energy cost crisis the Government are tackling, how it started and what we need to do to solve it.

The Select Committee heard evidence that paints a stark picture. Average energy bills are now 43% higher than in 2019, with over 6.1 million people living in fuel poverty. The situation in my constituency reflects the national crisis, with families and businesses struggling under the astronomical weight of energy costs.

However, the crisis did not happen overnight; it is the direct result of years of Conservative failure to properly insulate our homes, diversify our energy sources, reform the energy market and, ultimately, protect consumers. The previous Government’s resistance to onshore wind, their devastating cuts to energy efficiency programmes and their reckless over-reliance on volatile international gas markets has left British taxpayers paying the price.

When the last Labour Government left power, energy efficiency installations were at their peak, with 2.3 million homes upgraded, but the next Government dropped support and the numbers plummeted. As was mentioned, we now have some of the least efficient housing in the whole of Europe. The consequences of those decisions are felt every day by my constituents, who find themselves living in poorly insulated homes. There are 17,000 homes in Northampton South with an energy performance certificate rating of C or below. Those homes waste energy, but also my constituents’ money.

The fundamental issue is clear: we must break our dependence on gas if we want energy bills to come down. As Ofgem’s chief executive officer told the Committee a few weeks ago, unless we transform energy infrastructure we will remain at the mercy of volatile international gas markets. The evidence shows that, in a clean power system, even a major shock of the kind we have seen in recent years would see bills rise by an average of 9%, versus 44% following the gas crisis in 2022. That is why this Government’s mission for clean power is so vital. It is not just about the climate; it is about bringing bills down. Under questioning from our Committee, Ofgem’s representatives agreed that the target, while ambitious, is very achievable. However, they also warned that, without urgent action on planning reform and supply chains, we risk missing that crucial deadline.

We must also acknowledge the historic failures of market regulation. Consumer debt has now reached an astronomical £3.82 billion, which is nearly double what it was two years ago. When we pressed Ofgem representatives on what would trigger serious Government intervention, they could not give a clear answer, but it is clear that something more has to be done. The chief executive admitted that they should have developed much more detailed rules on prepayment meters and market regulation much earlier, rather than relying on broad principles that left vulnerable customers exposed. Even now, Ofgem acknowledges significant gaps in its powers to protect consumers, particularly around data sharing between Government Departments to identify vulnerable households that need support.

The Committee dug into one particular example: the regulator’s handling of supplier failures, which is deeply problematic. We were told that when energy companies went bust, the shareholders were able to walk away with hundreds of millions of pounds of energy hedges, while taxpayers were left picking up the bill. Ofgem admitted to us that it lacks the power to recover those funds on behalf of the taxpayer, so hundreds of millions of pounds have been lost to those who have gambled on our energy market. That is a striking example of how the market has been stacked against ordinary people. The regulator’s director of markets did acknowledge to the Committee that some suppliers are still not compliant with new financial resilience requirements, but he could not assure us as to what actions Ofgem would take if those suppliers fail to meet the deadline by March.

Moving to clean power is essential, and we must take immediate action to protect vulnerable households. That is why I support the move to a social tariff; a discounted energy scheme for low-income households would make sure that we build a fairer, greener and more sustainable energy system for everyone. At its core, a social tariff is a targeted discount on energy for people on low incomes, which would act as a vital safety net and ensure that nobody must choose between heating and eating. A social tariff could provide a guaranteed below-market rate for eligible households, with automatic enrolment for those who qualify. There would be no complex switching around or shopping around, just straightforward help for those who need it.

The evidence shows that 6.1 million households now live in fuel poverty, with many of those who are struggling paying a poverty premium. They are using prepayment meters or are on standard variable tariffs, which is simply wrong. A properly designed and implemented social tariff would be mandated across all suppliers, so that no one misses out; it would automatically enrol eligible households, using existing data to remove barriers to entry; and it would deliver real savings for those most in need.

As one of the richest economies in the world, we should make sure that everyone can afford to keep their homes warm. The technology and the mechanism exist, but now we need the political action to make it happen. Achieving clean power by 2030, combined with proper consumer protection and targeted support, will bring bills down for good. The previous Government’s failures have cost families dearly, and I urge Members on both sides of the House to use their voice to call for greater protection for energy users and greater power for regulators, and to call out the profiteering of energy companies at times of crisis.

Great British Energy Bill

Mike Reader Excerpts

2nd reading
Thursday 5th September 2024 Commons Chamber

[Mike Reader (Northampton South) (Lab)]

I have had the opportunity to hear some amazing maiden speeches in this House. Following such fantastic speeches, I must admit that I feel a bit nervous standing here, but I am also deeply honoured to be in the House. I thank my hon. Friend the Member for Clwyd East (Becky Gittins) for her fantastic maiden speech and for graciously meeting my family when they visited last year; they are her constituents. It is clear to me that the talent, enthusiasm and fresh thinking that the new cohort of MPs are bringing into this House will help to restore our country’s fortunes and deliver the change that the country voted for.

I am delighted to make my first speech in the debate on GB Energy. For many years, it has not sat right with me that our neighbours and trading partners around the world have benefited from the investment of UK plc in clean energy. Whether it is wind farms built in Scandinavia, or investment in nuclear by our French Government partners, the UK public has been sold short on clean energy investment. It is right that the Labour Government are taking forward plans for sovereign, safe and secure energy in the UK—that is very welcome in my constituency.

I will use this speech to introduce myself and my constituency to the House, recognise the careers of my predecessors, and to set out my vision for the future of Northampton. Despite coming from a family of teachers and educators, and despite the best efforts of my dad, who joins me today from the Public Gallery, and my mum, who is watching from home, school and exams definitely did not come naturally to me. After a difficult results day, I managed to get to university via a foundation degree, and I found my passion in civil engineering.

I have been fortunate since then to have progressed through the industry—from engineering to commercial and project management—and then into senior leadership roles. I am really proud to have been recognised as a global leader in my field by my peers in the profession, despite a less-than-ideal start in life—one of my own making—and to have had my career shaped by amazing experiences, projects and people around the world. I thank in particular my friend and mentor, Jon Williams, who has helped me the whole way through my journey, and my very good friend and former podcast co-host, Jeremy Brim, for all their guidance. I also thank my former bosses, Jason Millett and Davendra Dabasia, and my amazing former work-winning team, for giving me the space and support that I needed to pursue my political passions alongside a demanding day job.

I come to this place as an advocate for the built environment. To be honest, I could not be in a better place now, with a Government focused on growth and on transforming and future-proofing our energy, housing and transportation infrastructure. Many of my friends and industry colleagues asked why on earth I would want to stand for Parliament, but my journey into the world of politics has been shaped by my time in industry. I first saw the impact of austerity on my public sector clients, with school programmes cancelled, infrastructure investment stalled and hospitals left crying out for funding. That drove me to join the Labour party and find my political voice, determined to ensure that our public sector gets from Government the support and funding that it desperately needs.

When the opportunity came to stand and make a difference, I chose to stand where I live: Northampton. I met my wife Katie, who also joins us from the Public Gallery, just down the road in Wellingborough, and Northamptonshire has been my home for nearly 20 years now. I still have a place in my heart for my home town of Romsey, which is well represented by you, Madam Deputy Speaker. [Hon. Members: “Hear, hear!”] But I am proud to call myself a Northamptonian and to represent the town that I live in and love.

Northampton South is a vibrant constituency. From Duston and Upton in the west, the Hunsburys and Shelfleys, Wootton, Collingtree, Hardingstone and Great Houghton in the south, and areas such as Weston Favell, Billing and Rectory Farm in the eastern district, each area of my beautiful constituency has its own individual identity. In the centre of my constituency remains the legacy of the shoe-and-boot trade that was once the main employer in my town. The Church’s shoe factory remains in St James, and the surrounding terraces in Far Cotton and Delapre are still standing strong nearly 200 years after they were built. As my hon. Friend the Member for Northampton North (Lucy Rigby) noted yesterday, Church’s holds the honour of being the chosen cordwainer of a renowned former Member for Sedgefield.

Great institutions such as our university, our general hospital, our football club and our Premiership-winning rugby club sit in Northampton South. [Interruption.] I was expecting a “Shoe army!” then, but that’s fine. My constituency includes Brackmills, one of the most successful business improvement districts in the UK. Thousands of people are employed at Brackmills, which plays host to over 330 brilliant businesses, spanning food production, logistics and fulfilment, manufacturing, healthcare, and research and development. I look forward to working with the BID team to ensure that it continues to be a major employment hub in Northampton South for years to come. Anyone who has visited my constituency or grew up there will know that we are the home of the national lift tower, which stands at over 400 feet high—taller than the Statue of Liberty.

The formation of the newly shaped Northampton South constituency means that I have had the opportunity to take over from two former Members of Parliament who had had very different experiences and careers in this House, and I would like to pay tribute to them both. Andrew Lewer, the previous MP for the former Northampton South constituency, was focused on parliamentary business and tackled the challenges that he saw as the most important to the UK. He championed the Motor Neurone Disease Association, which is headquartered in Northampton, as well as independent schools and house building. Locally, he will continue to be recognised through the annual Spencer Percival debate that he helped to set up in the town. He is also the only person to have held the positions of leader of a council, Member of the European Parliament and Member of this House—a testament to his public service.

I also take over in part from Dame Andrea Leadsom, the former Member of Parliament for South Northamptonshire. Many of the southern villages that have now joined Northampton South were in her constituency. Dame Andrea served as a Secretary of State under the previous Government, and had a formidable record of championing parents and children, including by establishing the Northamptonshire Parent Infant Partnership in my county. Many of the people who have written to me since my election have praised her advocacy for them as their constituency MP. It is clear that she made a massive difference not only in this House but in our county.

Northampton may hold the accolade of being the largest town in the UK—I will take that up with hon. Members for Reading after the debate—but our town has had a continual lack of investment, and a lack of vision and drive to make it better. Unfortunately, we have had no shortage of Conservative scandals: public loans to our football club went missing, our county council was made bankrupt, the former police, fire and crime commissioner stood down over misogyny complaints, and alleged domestic abuse meant that that the leader of the council resigned and now stands as an independent. Trust in politicians in Northampton is at an all-time low, but there is hope for Northampton, and it comes with a Labour Government.

This Labour Government will make Northampton a place to be proud of. We will tackle our chronic air quality challenges; fix our roads; improve our bus network; ensure that housing is affordable, of good quality and highly sustainable; make work pay and a route out of poverty; grow the co-operative, social enterprise and mutual sector in our town; bring NHS dentists back to Northampton; end the 8 am scramble for GP appointments; face head-on the funding gap left in our public services; and address the special educational needs and disabilities crisis that is rocking our county.

It is clear that there is a lot of work to do, but as I said in my acceptance speech at the count, the hard work starts here, and I really mean it. I cannot wait to get started.