Thursday Volume 607 24 March 2016 No. 139 HOUSE OF COMMONS OFFICIAL REPORT PARLIAMENTARY DEBATES (HANSARD) Thursday 24 March 2016 £5·00 © Parliamentary Copyright House of Commons 2016 This publication may be reproduced under the terms of the Open Parliament licence, which is published at www.parliament.uk/site-information/copyright/. 1733 24 MARCH 2016 1734 Colleen Fletcher: The Competition and Markets House of Commons Authority’s proposal regarding a safeguard price control for prepayment customers is welcome and will go some Thursday 24 March 2016 way towards redressing an inherent unfairness that affects the most vulnerable people, but the authority and the Government should go much further. Will the Secretary The House met at half-past Nine o’clock of State commit to ensuring that prepayment customers are prioritised during the smart meter roll-out? PRAYERS Amber Rudd: I share the hon. Lady’s support for the CMA’s proposal for the most vulnerable customers, a [MR SPEAKER in the Chair] larger proportion of whom are on prepayment meters, and we welcome that approach to ensure that we look after those people. On smart meters, while some energy BUSINESS BEFORE QUESTIONS companies are prioritising prepayment meters, we are not obliging them to do so because the roll-out of smart NEW WRITS meters is so inherently important to managing people’s Ordered, bills. That the Speaker do issue his Warrant to the Clerk of the Crown to make out a new Writ for the electing of a Member to Liz McInnes: Will the Secretary of State tell the serve in this present Parliament for the County constituency of House, so that I may inform the 9,255 of my constituents Sheffield, Brightside and Hillsborough in the room of Harry who have prepayment meters, why her Department will Harpham, deceased.—(Dame Rosie Winterton.) not bring forward its fuel poverty strategy for another Ordered, two years? That the Speaker do issue his Warrant to the Clerk of the Crown to make out a new Writ for the electing of a Member to Amber Rudd: The Department and the Government serve in this present Parliament for the County constituency of take fuel poverty very seriously and we take steps to Ogmore, in the room of Ifor Huw Irranca-Davies, who since his election for the said County constituency has accepted the Office address that issue. We are reforming the renewable heat of Steward and Bailiff of Her Majesty’s Manor of Northstead in incentive and the energy company obligation to focus the County of York.—(Dame Rosie Winterton.) more on those most in need, who are those in fuel poverty. I ask the hon. Lady to reassure her constituents that we are absolutely committed to doing that and that Oral Answers to Questions we will continue to address the issue. Dawn Butler: The CMA report exposes one of the biggest scandals of this generation: the £1.7 billion that customers are being overcharged. The recommendations ENERGY AND CLIMATE CHANGE in the report will not kick in until 2018, by which time people will be overcharged by £2.4 billion a year. The The Secretary of State was asked— Secretary of State must oblige energy companies to roll out smart meters now, especially if the Government are Indebted Prepayment Customers to achieve their own recommendation of all households having smart meters by 2020. 1. Colleen Fletcher (Coventry North East) (Lab): What steps she plans to take to reduce energy prices for Amber Rudd: I reassure the hon. Lady that rolling out indebted prepayment customers. [904290] smart meters is an obligation on energy companies, which are being regulated by Ofgem to ensure that 4. Liz McInnes (Heywood and Middleton) (Lab): every household has a smart meter by 2020. The CMA’s What steps she plans to take to reduce energy prices for recommendations observe that competition is the best indebted prepayment customers. [904293] way to deliver lower prices. We are making sure that more competition enters the market so that customers 9. Dawn Butler (Brent Central) (Lab): What steps she such as her constituents can have access to that and to plans to take to reduce energy prices for indebted cheaper bills. prepayment customers. [904301] Andrew Bridgen (North West Leicestershire) (Con): The Secretary of State for Energy and Climate Change Prepayment customers are among the most vulnerable (Amber Rudd): The Government want energy bills to in our society. They have fewer tariff options and find reduce for all consumers, and one of the best ways to switching more difficult. What steps is my right hon. achieve that is by switching supplier. However, the hon. Friend taking to remove barriers such as debt issues so Member for Coventry North East (Colleen Fletcher) that it is easier for these people to switch and get a has raised an important point by highlighting the barriers better price? that indebted prepayment customers face in doing so. The Competition and Markets Authority’s report on Amber Rudd: My hon. Friend is absolutely right. The provisional remedies rightly includes a recommendation CMA investigation represents the biggest investigation that Ofgem should take steps to address those barriers, into the energy market since privatisation, and the and I will consider the issue carefully following the Prime Minister promoted it by referring the market to publication of its final report. Ofgem and on to the CMA. The CMA has focused 1735 Oral Answers24 MARCH 2016 Oral Answers 1736 specifically on indebtedness. We will look at its have raised the cost of investing in UK energy by recommendations to ensure that the most vulnerable £3.14 billion a year. Given that she is costing bill payers customers also have the option to switch and are not almost twice as much as the big energy companies, will excluded from competition within the market. she refer herself to the CMA? Caroline Flint (Don Valley) (Lab): But the CMA Amber Rudd: Let me start by answering the key point found that 70% of customers were being overcharged, that the hon. Lady makes about the 70% of consumers while those on prepayment meters represented only who are not on prepayment meters and are overpaying. 16%. It found that there had been overcharging of The central way to address the 70% is to make sure that £1.7 billion a year since 2012, rising to £2.5 billion in there is more competition in the market. When we came 2015. A cap is available for those on prepayment meters, into office in 2010, there were six suppliers; there are but what about the rest of the 70% of customers who now 31 new independent suppliers. Switching times are are being overcharged? What will happen for them, now down to 17 days and, with Ofgem’s guidance, we apart from urging them to switch? hope to move to same-day switching by 2018. All those measures will enable consumers to access a competitive Amber Rudd: It was, of course, disappointing that the market. Labour party opposed referring the energy market from Ofgem to the CMA. It is the CMA that has come The hon. Lady’s comments regarding the Energy and forward with the recommendations, which I think is a Climate Change Committee are a random selection of welcome development. The right hon. Lady asks what some of the Committee’s thoughts. I do not share its can be done for other customers. The answer is that views. In fact, I have been advised by a number of more competition in the market will allow people to people who have attended the Committee and by major switch so that her constituents will be able to have investors that they take great comfort from the clear access to cheaper bills. I hope she will welcome the direction that has been set out from the Government reform in the market that has allowed more competition Benches for future energy policy. to develop, resulting in lower bills for her constituents and everybody else. Lisa Nandy: It is extremely disappointing that after this lengthy investigation, the Secretary of State has Caroline Flint: That is misleading the House. decided to blame customers for not switching and to let energy companies off the hook, so perhaps I will try Mr Speaker: Order. The right hon. Lady certainly another one. The CMA inquiry has also found that should not accuse anybody of misleading the House— price comparison websites are taking tens of millions of [Interruption.] Order. I do not require any advice from pounds a year in commission from the biggest energy other Members. I am perfectly capable of dealing with companies. In 2014 alone, they were paid £24 million. these matters. If the right hon. Lady wants to insert the Following her announcement that she will not hesitate word “inadvertently”, that would make it moderately to take forward the CMA’s recommendations, does she less disorderly, although she still should not chunter plan to implement the recommendation to allow the from a sedentary position in evident disapproval of the same websites to now deliberately hide the cheapest stance taken by the Secretary of State. That is rather deals from customers? beneath the dignity of a distinguished former Minister. Amber Rudd: The hon. Lady has misunderstood me. Caroline Flint: Thank you, Mr Speaker. I think the There is no blame on customers and no blame is being Secretary of State inadvertently— apportioned. We are saying that the CMA has provided a wake-up call to the energy companies, which now Mr Speaker: Just withdraw. need to take action to address competition within the Caroline Flint: I withdraw.