Oral Answers to Questions

Debate between Stephen Metcalfe and Chris Huhne

Thursday 20th October 2011 Commons Chamber

[Stephen Metcalfe (South Basildon and East Thurrock) (Con)]

T2. Following on from the comments of my hon. Friend the Member for Wells (Tessa Munt), with energy prices at an all-time high, many low-income families are opting to convert to prepayment meters for their gas and electricity supply. However, according to Consumer Focus that can cost up to £195 extra per year. Will the Secretary of State consider introducing regulation of the market to ensure that low-income families pay the same regardless of whether their payment method is by prepayment meters, direct debit or quarterly bills?

[Chris Huhne]

Energy tariffs are a matter for Ofgem. It has put in place rules to prevent unfair price differentials such as those between different payment methods and has reported on the effectiveness of those changes. It has found that prepayment meter customers now pay on average about £20 less than standard credit customers for their gas and electricity. It has also found that direct debit customers now pay on average £70 less than others, which falls within the £88 indicative cost difference between providing direct debit accounts and other types of agreement.