Energy Bill [HL]

My Lords, I missed the opening remarks of the noble Baroness, Lady Noakes, but I have heard her speak on this subject before. As I said at Second Reading, I am somewhat surprised that we are in broad agreement, although her concerns may not necessarily reach the same conclusions as mine. Nevertheless, we can make common cause in our concerns about this part of the Bill. As has been pointed out, we are affording ourselves the opportunity to pave the way for secondary legislation of an unknown kind. It is highly irresponsible for legislators or the scrutinisers of putative legislation to go down this road. This is not just a matter of partisan bleating; this is a serious constitutional issue. The last point that my noble friend made, relating to Ofgem, is a serious one. A significant point about the handling of complex markets that are, in effect, oligopolies—not quite monopolies but dominated by big players—is the requirement that we have a credible quasi-judicial market regulator to protect the consumer and, equally important, to sustain competition if that is the road we go down. A shortcoming of the original privatisation processes was that we went from state monopolies to private monopolies. It took a while for the market to kick in. Indeed, it could be argued that we initially went down an overly simplistic route in respect of the competitive market. Certainly, in relation to electricity companies in England and Wales, the market structure was akin to pre-Cavour Italy—a series of city states fighting each other and, as a consequence, leaving themselves open to other invaders. That is what we have at present: five or six major generating companies, of which only two could be regarded as independently British. We live in a global economy and these things happen. However, it is dangerous when too many of the natural resources on which we so depend are in the hands of people who do not necessarily regard our national priorities as their first concern. However, I do not want to go down that road tonight. All I want to say is that we must be exceedingly careful if we afford Governments of any stripe the right to change quasi-judicial organisations, such as the Gas and Electricity Markets Authority, by a process that affords no real opportunity for parliamentary scrutiny. We are delivered a statutory instrument that, although it has been the subject of extensive consultation, is the final article that we can accept or reject. If the changes were almost emergency measures but there was a difference of opinion, we could well have to defeat the thing and have another lengthy period of consultation before the Government of the day, regardless of party, got it right. So in terms of some of the powers which we are delivering to government here, if they were to stop and think about it they would not want to assume that kind of responsibility. As far as the ECO is concerned, there were a number of points. First, there is the manner in which we allow electricity and energy companies to introduce new forms of subsidy by imposing what is, to all intents and purposes, an energy poll tax on the households of this country. There is not a great deal of difference in the imposition of the revenue-raising that takes place in these circumstances. The average charge to households is of the order of £80. We are talking in terms of introducing changes in market structure which have been calculated as being anything between £400 and £800. It is a fairly arbitrary means by which that is going to be imposed over a number of years. We have to be exceedingly careful, therefore, if we are going to dress up support for the Green Deal, the energy and environmental improvement parts of the Green Deal and the financing of it as something that does not involve the Government or taxation but hits every household in this country, regardless of financial circumstances. If there is any group in this country that is entitled to feel that it is paying more towards this scheme through its electricity bills as a matter of course, it is those who live in hard-to-heat houses and those who are the most vulnerable, either in their health or their financial circumstances. It is to them that we have the first responsibility. That is to say, if we are to have an ECO, its fruits should go to the people who are either the most disadvantaged or the most vulnerable. It would be helpful for us this evening to get something more than platitudes about market solutions. Markets are not perfect. If they were perfect, we would not need any form of regulation at all. The fact is that they need to be structured and nudged at particular times. What we need in these circumstances is recognition that if we do not have Warm Front or CERT, we still need some form of directed effort towards helping the disadvantaged. At the moment, my understanding is that the disadvantaged, whether they go in for the Green Deal or not, will still have to make their financial contribution through the ECO. It is my contention that they should not be required to pay for something from which they will not get very much, if that is because their local authority, social housing authority or private landlord—which we have discussed at length—is not prepared to enter into this deal in the way that we would like. As we are giving Government the power to introduce a number of changes by secondary legislation, we are entitled tonight to get reassurances that fairly soon we will see the colour of the Government’s money in the form of some explicit draft statutory instruments. They will obviously be doing the rounds at the moment. It would be foolhardy to suggest that somehow they are going to emerge after Third Reading but before Second Reading in the Commons. They will be in pencil form somewhere, stamped with ““Draft””, and it is not unreasonable for us to ask for that this evening. We do not divide in this Committee and it is not our intention to gum up the works but such constraints do not apply when we get to Third Reading. A number of people will be concerned about this, not just within the ranks of the Cross-Benchers and the Opposition; we know that in both parts of the coalition there are people who have anxieties about this. Therefore we need a lot more assurance, a lot more clarity and a lot more detail than we are being offered here. As I have said before, the people who read the Sunday Telegraph, the Observer or the Guardian at the weekend, and are looking for advice on the best bang for their buck in whatever area of expenditure they indulge in, will take care over this. They will go to Sainsbury’s and Waitrose and sign up for the deals. The people in the poorer areas who do not have the time and cannot always go to supermarkets, but of necessity shop locally—for whom the business of living is in itself too much of a problem—are entitled to a square deal that is part of the Green Deal. At the moment, I do not think that they are going to get it. We will not be convinced that they will get it until we get far more specificity—I have a couple of crowns missing at the moment, so that is rather difficult to say—from the Government. We need a lot more detail. I know that the Minister is labouring because his department has not got everything right, but we need tonight some clear indication that he will lift up the edge of the carpet and let us see what is underneath it. If he does not, he will find that he gets opposition of a different character from what he has received in this Committee, where we have been very polite and very nice. Do not bank on that for too long if we do not get the information that we require.