Energy Bill

I am delighted that the hon. Gentleman intervened at the moment that he did and in the way that he did because he has completely anticipated my next point. Despite the fact that the leader of his party insisted that every family in the country could spend £6,500 on their household energy efficiency—and the shadow Secretary of State for Energy and Climate Change emphasised that point in the House recently—the truth of the matter is that in practice it would be nothing like that sum. And if it were £6,500, it would be unsustainable to support, in terms of the investment required to underpin it. It is because the sum would be nothing like £6,500—it would be more like £1,500 on average under the Conservatives' blue-green energy proposals—that funding the policy even starts to become conceivable for most households. Indeed, the savings suggested for an expenditure of £1,500 are the full £360 that would be needed to underpin the £6,500 in terms of the interest that would be lost through granting that sum. It is claimed that those savings would result from measures such as the installation of low-energy light bulbs, cavity wall insulation and roof insulation, all of which have already been legislated for to a considerable extent, or are under way. By 2011, for example, low-energy light bulbs will be in place across the whole of the UK. The policy does not take seriously the real job that needs to be done, especially on fuel poverty, or the investment in efficient homes that it will be necessary to undertake. The recent White Paper, which does take the issue seriously, proposed that all homes should have a whole-house package—to be achieved not by legislative means but through other measures—to include cost-effective energy saving measures plus renewable heat and electricity measures as appropriate by 2030, and all lofts and cavity walls to be insulated, where practicable, by 2015. It also included the development of new ways to provide financial support so that people could make more substantial energy saving and renewable energy improvements. Does it not appear sensible to work out how that can be done properly in order to pursue the policy, instead of magicking a sum of money out of thin air, which would be completely insupportable in the real world? Would it not make more sense to examine placing a charge on the district network operator for the supply to the household? Would it not make sense to consider how loans could come into the equation to overcome the capital costs of such energy-saving devices? Would it not make sense to consider the option of leasing, or to pilot some of these schemes so that what we say and what we can do are the same thing? In a future low-carbon energy economy, the savings will need to match up to the investment so that the householder will be in a win-win situation in terms of their energy bills as well as the security of a well insulated, low-carbon house. We need to be clear that whatever the oscillation in energy prices in the future, they will be high and will get higher. There is therefore a particular onus on us to bring forward serious and well thought-out programmes to ensure that those people who are not able to afford their energy bills now—let alone future higher energy bills —are proofed against those bills for a long time to come. We need to be looking at a quantum shift in our understanding of what an energy bill should consist of and what those in fuel poverty face in paying their fuel bills. For the future, I envisage that happening in much the same way that council tax is paid—everybody pays it, but there is a rebate for those in less fortunate financial circumstances—so that a number of people are thereby effectively excluded or only partially included in the process of paying energy bills. Having a requirement in the Bill that social tariffs be introduced by legislation in future, rather than by voluntary agreement, seems to be a move towards that idea. We are all in this together, in ensuring that we have a low-carbon energy economy, alongside what we know will be high prices for energy supplies, but at the same time ensuring that the effects of that high-cost energy economy are not brought to bear in a most cruel way on those who can least afford to finance such an energy economy. Therefore, a fuel poverty strategy should combine several different factors, not all of which will exactly correlate with each other. It is not the case, for instance, that everybody who is in fuel poverty lives in a badly insulated house, although a good proportion do so. Therefore, a strategy that moves rapidly towards ensuring that the standard assessment procedure ratings—the SAP ratings—of houses across the country are raised substantially, in order to fuel-poverty proof those houses as far as possible, seems absolutely essential. However, it is also not the case that simply doing that will cause everybody who is now in fuel poverty not to be in fuel poverty. It is also not the case that everyone who is in fuel poverty stays in the same house. Therefore, a programme to ensure social tariffs, tariff reductions and affordable tariffs for those in fuel poverty—these might be related as, in effect, a gateway benefit, in respect of other indicators of the fact that a person in fuel poverty lives in a house that is not well insulated—would seem to be a way forward in ensuring, as far as possible, that fuel poverty becomes a thing of the past in our future energy economy. We have to be honest and reflect on the indicators of fuel poverty. Although it is widely accepted that those who spend more than 10 per cent.—10p in a pound—on their energy bills are in fuel poverty, that definition rises or falls precisely with energy prices. Some 40,000 people will be in fuel poverty if fuel prices rise by 1 per cent., yet they will apparently come out of fuel poverty if fuel prices fall by 1 per cent., regardless of their objective circumstances before or after that price rise or fall. Therefore, attempting to secure a combination of factors in fighting fuel poverty, so that people are fuel-poverty proofed as far as possible, seems to be the right way forward. That will require a combination of legislation and regulation on a series of important fronts. It is therefore interesting to note that the code for sustainable buildings, which will ensure by 2016 that the building of new houses is carbon neutral as far as possible, which will, among other things, help to increase the SAP rating of UK housing stock, is not based on legislation.