Yasmin Qureshi
Main Page: Yasmin Qureshi (Labour - Bolton South and Walkden)(10 years, 3 months ago)
Commons ChamberRead Full debate Read Hansard Text
Caroline Flint
It is already on the statute book that the regulator has the power to fine up to 10% of the global turnover of any company. I might need to go back and check, but I believe that nobody had to prove that that had been used anywhere else before the power was put on the statute book. The Secretary of State is following a ridiculous line of argument. In recent years, a number of instances have led to investigations and fines and have shown repeated evidence of ways in which customers have been let down. We are saying that that is not good enough and that there has to be the ultimate sanction of companies losing their licence. That is the proposition. The detail needs to be discussed before it is put into law. I have been up front and honest about that, but I find it hard to believe that the Secretary of State has seriously set his face against the proposition.
Yasmin Qureshi (Bolton South East) (Lab)
Is my right hon. Friend as perplexed as I am about why the Government seem to have a problem with the ultimate sanction that we can impose against any company, which is to take away its licence? There is no point in asking what examples we can give, as the Opposition are saying that the power should be there so that if the regulator finds that the breaches are sufficient, the ultimate sanction is available to it. I am surprised, and I am sure that my hon. Friends are, too, that the Government are resisting.
Caroline Flint
I absolutely agree. I can hear the Secretary of State saying over and over that it is already available—[Interruption.] Obviously, he has his brief and has not been listening to my speech. As I have outlined clearly and as has been confirmed by Ofgem, the regulator can revoke a licence when a company is going into administration or is insolvent or when it fails to supply gas or electricity, but what is missing at the moment is the ability when there are repeated offences that act against the interests of consumers to take the ultimate sanction and revoke the licence.
The Secretary of State for Energy and Climate Change (Mr Edward Davey)
I thank the right hon. Member for Don Valley (Caroline Flint) for calling a debate on an important subject: how best can we protect energy consumers from unfair treatment by their suppliers? Although there are examples of good customer service—energy companies that are treating their customers properly—it is hardly controversial to say that there are far too many cases where energy firms have let their customers down badly—the mis-selling, the poor complaints handling, and the poor billing. This is not new; it has been going on for many years and can just take different forms. Right hon. and hon. Members who have served in this House for a few Parliaments will recall all the scandals of doorstep mis-selling. I recall an elderly constituent coming to my local surgery in 2003 having been appallingly treated and conned by a representative of one of today’s big six. So this is a serious matter and, despite efforts by the previous Government, this Government’s focus on this issue and the work of Ofgem, it is clear that there are still energy firms that are treating their customers unacceptably.
Yasmin Qureshi
The right hon. Gentleman gave the examples of mis-selling and the mistreatment of customers. Are they not the type of repeat offending by energy companies that should mean that their licences could be revoked?
Mr Davey
I will explain to the House that under current rules licences can be revoked, and I will deal with these issues. I am admitting that this a good debate to have, because there is a problem—nobody is suggesting otherwise. But, as always, the question is: what is the best way to deal with that problem? What is going to work? What is the best way to crack down on this to punish firms that get it wrong? In essence, we can use three tools: competition; regulation; and technology. The right hon. Member for Don Valley has focused on regulation, and I want to address her proposal in detail, for tough regulation certainly has a vital role to play in holding companies to account. However, I regret that her motion and her speech totally failed to mention competition and technology—those were not even mentioned once. That is a serious mistake, which the Opposition keep making. For many of the smaller suppliers now competing—
Mr Davey
I am going to make some progress.
In fact, the current law allows the regulator to do more than just fine a company. Let us take an example. Ofgem can issue provisional orders that require a range of things, including banning a company from taking on new customers and setting specific behaviour that it must meet so that it is no longer in breach of licence conditions, including the standards of conduct. A final order can be issued when Ofgem believes that the same licence contravention is likely to continue, and in doing so Ofgem can look at the pattern of behaviour of previous breaches. Breaching a final order could then trigger a licence revocation, even if that remains an extreme circumstance. The powers that the right hon. Lady is talking about already exist in the form that I have described, where orders happen and improvement orders are required and they are not complied with.
This looks like a regime that is working today and it was not working under Labour. If the Opposition are proposing to lower the bar for a nuclear option, it is incumbent on them to explain exactly when that would be used, because consumers and businesses need to know exactly where the line is drawn. Perhaps the right hon. Lady wants to clarify her position now; she failed to do so, despite being intervened on by myself and my hon. Friend the Member for Warrington South (David Mowat).
Let me give the right hon. Lady an example. Would she have expected Ofgem to have closed npower down by now? More complaints have been made about npower than any other energy company. It is under investigation. Does she think her new power should have been used to revoke npower’s licence? A simple yes or no would suffice, if she is willing to give us an example. She is not, and the House will have noted that.
Madam Deputy Speaker (Mrs Eleanor Laing)
Order. The right hon. Gentleman is not giving way.
David T. C. Davies (Monmouth) (Con)
Will the right hon. Gentleman give way?
Mr Davey
I am grateful to the hon. Gentleman for his measured comments. The process in the law that I have described does end in a red card, and I hope that when he and the right hon. Member for Don Valley look at it in more detail, they will see that it can result in a red card. I said that I would give way to the hon. Member for Bolton South East (Yasmin Qureshi).
Yasmin Qureshi
I thank my hon. Friend for that. There seems to be a difference of opinion. We say that the grounds on which a licence can be revoked are very limited and technical. If I understand the Secretary of State correctly, he is saying that there are much wider grounds for revocation. Perhaps the way to resolve the dispute would be to take advice from expert legal counsel as to whether, legally speaking, our position or that of the Government is correct, because that way—
Madam Deputy Speaker (Mrs Eleanor Laing)
Order. I appreciate that the hon. Lady waited a long time to make an intervention, but it is not a speech.