A recent episode of Prime Minister’s Questions became (literally) electrifying news about energy prices when the David Cameron said he would bring in new laws to force energy companies to give customers their cheapest deals.
On the face of it, this is a laudable statement, but immediately led to 24 hours of confusion and rushing around among Government ministers with analysts also suggesting that the Government’s sudden policy could in fact lead to higher energy bills for ordinary families. The next day, junior minister John Hayes was called to the House admitted in the Commons he had no idea how the PM’s promise might work in practice.
In the debate, I asked a question regarding analysis on “Newsnight” which suggested that the policy as announced by the Prime Minister could well reduce competition and increase prices.
Following this, Energy Secretary Ed Davey then set out a totally different approach to cutting the cost of heating and lighting – by promoting competition between fuel firms.
Which ever way it happens, and however we make sure that changes are made with consumer prices paramount and national policies set up to support long term investment in future sustainable energy supplies, it is clear that the high prices are going to be another strain on cost of living for local families over the coming winter.
The cost of a typical dual fuel bill is now £1,310 – up by £200 since this Government came to power, meaning that energy bills are now one of the biggest costs families face. And, despite making record profits, energy companies are raising prices again this year. Last week EDF Energy, who dominate 74% of the energy market share of London, announced an increase in electricity and gas prices for residential customers by 10.8% from 7 December.
There are enormous energy challenges facing this country, and we need to think seriously about how we’re going to ensure there is enough affordable energy to go round. According to the National Energy Action, there are more than 6.6 million households across the UK who cannot afford to heat their homes, putting them at risk of health and other problems.
Labour called a debate in the House of Commons to demand real help now, as well as reform the way our energy market works for the long-term. Shadow Minister Caroline Flint MP has argued for energy companies to put all over-75s on the cheapest tariff, a move which could save pensioners in Feltham and Heston as much as £200 a year from their annual energy bills. Energy generating companies would have to pool the power they produce and make it available to any energy retailer, in an attempt to open the market and put downward pressure on prices. Labour would also change Ofgem to a new energy watchdog with a statutory duty to monitor wholesale and retail energy prices, and the power to force energy suppliers to pass on price cuts when the cost of wholesale energy falls.
Cuts to the Winter Fuel Payment are also set to make matters worse. The Chancellor George Osborne has cut help for pensioners with their fuel bills by £50 for the over 60s, and £100 for the over 80s. With more than 36,700 pensioners dying of cold-related illnesses last winter, we need to work together as a community to make sure people more at risk of the cold are supported and don’t put themselves at risk by having to choose whether to heat or eat. Over the next few months, the debate is set to continue in the Commons and I would welcome the views of local residents.
Labour has also launched a Switch Together campaign to help families get a better deal.
If you’re interested in signing up and seeing if you can get a better deal through collective switching, you can visit www.switchtogether.org.uk. I would also encourage anyone who would like advice on keeping warm this winter to get in touch with their energy company or local MP to seek advice early.