Cost of Living
Debate between Pat Glass and Nigel Adams
Pat Glass (North West Durham) (Lab)
I have sat through the entire debate and have been increasingly frustrated by the contrast between the contributions made by Members from opposing sides of the House. I am genuinely delighted at what the hon. Member for Gloucester (Richard Graham) had to say about how well things are going in his constituency, but that contrasts starkly with what is happening in constituencies such as mine. Surely a Government should govern for all the people, not just some, and improvements in one area should not be made at the expense of others.
I want to discuss the impact of the Government’s failure to get growth moving and to create jobs. In particular, I want to discuss the impact of the rising cost of energy on people’s lives. My hon. Friend the Member for Newcastle upon Tyne North (Catherine McKinnell) referred to a report in last week’s Observer which said that Lord Young, a former Cabinet Minister and now the Prime Minister’s adviser on enterprise, has told the Cabinet that the current economic downturn, which is causing so much pain and damage to people in this country, is an excellent time for businesses to boost profits, because labour is cheap and can be driven down further.
Pat Glass
No, I am not going to take interventions.
Those comments came from a man who has already been forced to resign once for downplaying the impact of the recession on people and who, it appears, only opens his mouth to change feet. I want to tell Lord Young and his ilk about the reality of a recession and the effect that it and the policy of driving down wages has on the lives of real people.
The gap in wages in the north-east is growing. Weekly wages have fallen on average by £23 a week and by almost £2,000 a year at a time when all other costs are increasing. I have spoken many times in this Chamber about energy prices and their impact on people’s lives and about how the Government are systematically failing to put in place safeguards to prevent the big six energy companies from manipulating the market to achieve massive profits at the expense of the consumer and at virtually no risk to themselves.
Last October, the Prime Minister, under pressure, promised that the Energy Bill would force energy companies to offer the lowest tariff to all their customers, but I have looked carefully at the Bill and cannot see that it delivers anything like that. I was amazed to hear the hon. Member for Halesowen and Rowley Regis (James Morris) speak positively about it. We have clearly not been reading the same Bill.
The Energy Bill was hailed by the Government as a new way forward that would reform the market, deliver a better deal for customers and curb energy company profits, but my reading of it is that it fails on all those objectives. It fails to put in place safeguards to prevent energy companies from manipulating the market to achieve massive profits at the expense of consumers. In fact, the Bill’s proposed energy auction gives yet more opportunities for energy companies to manipulate the market by decommissioning and mothballing stock, holding it back to create shortages and then demanding greater prices at future auctions. That is happening now; we just have to look at Scottish and Southern Energy to see it mothballing stock for those purposes. It is wrong, it is blackmail and it will hit consumers desperately hard. The Government know that it is happening and are doing nothing to prevent it.
The Bill will fail to prevent situations such as the one that occurred last year, when the big six companies followed one another in announcing huge increases in energy prices. British Gas went first, increasing its gas prices by 18% and its electricity prices by 16%. It was quickly followed by Scottish and Southern and the other four. British Gas attempted to defend its massive price increases by saying that the bills were driven up because 50% of its energy is bought on the international wholesale market and it had been selling it at a loss to consumers in this country. That is simply not true. We all accept that capital has to make a fair return on its investment, but this is not a fair return; it is daylight robbery of the British consumer while the Government stand back and do less than nothing. Some even argue that the Energy Bill will make it easier for energy companies to rip off customers.
I will finish because others want to speak. I simply want to say that the Government’s record on energy is not good and the Energy Bill will make the situation worse. It will make energy companies richer and consumers poorer. I ask the Government to look at it again while they have the opportunity. Energy companies are using blackmail and the Government have the ability to stop it.