Energy Company Charges

Tracey Crouch Excerpts

Tuesday 4th February 2014 Commons Chamber

[Tracey Crouch (Chatham and Aylesford) (Con)]

When my hon. Friend the Member for Harlow (Robert Halfon) asked me if I would wind up this debate, I thought it would be a great privilege. Now as I stand here, with my intelligent and beautiful Whip—my hon. Friend the Member for Guildford (Anne Milton)—sitting on the Front Bench with her pen poised, I am beginning to wonder whether this will determine whether I shall be a Minister in the future. The Minister was kind enough to offer me some advice, which was: “You’ll do a good job, but please try not to do a great job.” I shall therefore do my best to satisfy both the Whip and the Minister, but also to reflect the important aspects raised in this afternoon’s debate.

I thank the Backbench Business Committee for allowing this important debate and congratulate my hon. Friend the Member for Harlow on securing it. He is a tireless campaigner who always puts his case so expertly, as he has today. His speech was very clear in setting out the scale of the problem. He recognised that the Government have done much on the need to protect consumers, especially when experiencing additional charges. He outlined the case incredibly well, as did many others.

It is important to note that until the shadow Minister’s speech and the Minister’s speech, there was a great deal of consensus across the House on helping the most vulnerable consumers. The motion focuses on the 17 energy companies that are subjecting customers who do not want to pay by direct debits to charges. It is a great honour that 179 colleagues signed the motion, which shows how important this issue is to us in representing our constituents.

Those who spoke did so with passion. The hon. Member for Ynys Môn (Albert Owen) did a great job of standing in at the start. He spoke on energy prices in general and praised the work of the Select Committee on Energy and Climate Change. Like him, I was reluctant to switch to direct debit initially, preferring, like millions of other people across the country, to have control over when I pay my bills, based on the energy I use. That was reflected in many contributions this afternoon.

The hon. Member for Makerfield (Yvonne Fovargue) is a consumer champion on many issues. Her emphasis today on prepayment meters demonstrated characteristic concern for our poorest in society. I listened carefully to what she had to say. The hon. Member for Redcar (Ian Swales) spoke of one of his constituents and raised similar concerns about prepayment meters. The Minister heard those concerns loud and clear, as I am sure did those listening to the debate. I hope that the energy companies also took on board some of the issues that were raised.

The hon. Member for Mitcham and Morden (Siobhain McDonagh) used constituency casework as the basis of her contribution to today’s debate. I was fascinated by the excellent project she highlighted, an advice day surgery involving the big six. With her permission, I might steal it for my constituency, which has areas of deprivation and where we see concerns among particular pockets of energy consumers about paying their bills. I will be in touch with her office to find out precisely how she did that.

The hon. Member for South Down (Ms Ritchie) said that the charges should be seen in a wider economic context. She also said that many people felt that they were being penalised for not paying by direct debit, a view that was reflected throughout the debate. I agree with the hon. Member for Angus (Mr Weir) that this is as much about social exclusion as it is about unfair charges for those who cannot pay for utilities by direct debit because, for example, they do not have bank accounts. He made that case extremely well.

As a fellow south-east Member, I agree with what was said by my hon. Friend the Member for Romsey and Southampton North (Caroline Nokes) about rural broadband. However, I think it important to note that those who pay online are not immune to stealth charges. The problem does not just affect those who post cheques or take them to the post office.

The hon. Member for East Antrim (Sammy Wilson) made an incredibly important contribution on behalf of his constituents. He pointed out that 38% of people in Northern Ireland pay bills by direct debit, as against 55% in the United Kingdom overall. I thought that that was a very interesting statistic, and I hope that work will be done to establish the reason for it.

My hon. Friend the Member for Braintree (Mr Newmark) spoke of the need for fairness and transparency for our constituents, especially, but not exclusively, the elderly. He said that those who paid bills on time should not be penalised. He also made the very fair point that Labour Members, who had been very critical of some of the Government’s measures, had had 13 years in which to sort the problem out, and had not done so.

The hon. Member for Strangford (Jim Shannon) praised the good work of Christians Against Poverty, and spoke of the importance of social contact to those who pay their bills at the post office. As a Member of Parliament who highlights the problem of isolation, particularly among the elderly, he was absolutely right to raise that issue.

The hon. Member for Edinburgh North and Leith (Mark Lazarowicz) certainly made amends for not signing the motion by speaking so knowledgeably about the issue. That was hardly surprising, given his long-term advocacy of consumer protection. He did a good job in, as it were, providing the 180th signature.

I have a great deal of time and respect for the hon. Member for Sunderland Central (Julie Elliott), whom I call a friend outside the Chamber, but I have to say that, given the tone of the debate, I was rather disappointed by her response. Opposition Members should remember that the ripping off of consumers by energy companies did not begin in May 2010, and that the Labour party had 13 years in which to stand up for vulnerable consumers and did not do so. The Minister made that point as well, but I was very sad that the debate ended on a party political note.

I was thrilled to become involved in the campaign initiated by my hon. Friend the Member for Harlow. Like many others, I did so because I was contacted by a constituent. Mr Steele, who lives in Lordswood, contacted me because he wanted to pay a number of utility bills online, but felt that he was being penalised for doing so. He said that British Gas had had the cheek to remind him that he would have been £67 better off if he had paid his gas bill by direct debit, and £33 better off if he had paid his electricity bill by that method.

It has been made very clear that Members want more transparency for their constituents when it comes to energy charges. We know that the charges are high and that they are often hard to justify in view of price increases and the large profits made by the industry, but it is unacceptable that customers are being penalised for choosing to manage their payments in a way that is convenient for them. The motion notes that 45% of people do not pay their energy bills by direct debit, and are being charged for not doing so. I hope that the energy companies will note what has been said here today, and will rectify the position immediately.

Question put and agreed to.

Resolved,

That this House is disappointed that 17 energy companies in the UK charge their customers more if they do not pay their bills by direct debit; acknowledges that some firms do not charge their customers any extra at all; notes that Department of Energy and Climate Change statistics show that this adds £114 to the average consumer’s bill; further notes that 45 per cent of people do not pay their energy bills by direct debit; recognises that over one million people in the UK do not have access to a bank account; believes that these charges are a stealth tax on the poor; and therefore urges Ofgem to hold an inquiry into these practices, encourages energy companies to operate with more transparency, and urges the Government to consider ways of limiting these charges, such as by introducing a cap.