My Lords, I will now move this amendment properly. I will not repeat what I just said, but the fact is that in this massive Bill, which gives the strategy for the energy sector for the next 10 years, the social dimension of that strategy and its effect on consumers are not entirely but largely ignored.
I moved a similar amendment in Committee and the Minister was not particularly interested. He claimed that we were already looking after the interests of vulnerable consumers. A couple of years ago, or slightly more, I did a small job for Energy UK, looking at the effect of the energy system on vulnerable consumers. To be fair, as a result of that both the trade body and some individual companies significantly improved their consumer service to the more vulnerable consumers, but they have not dramatically changed the tariff structure in favour of those who are least able to pay or who require a rather larger amount of energy than average because of their family condition, health, age, mobility and so forth.
A simple requirement that energy suppliers must include in their tariffs a social tariff for identified vulnerable consumers seems the most obvious and
straightforward way forward. We have the warm home discount and the major intervention, using taxpayers’ money, to off-set the effects of the gas price rise, which I fully recognise is the biggest intervention the Government have made on this front, but this would be an obligation on the companies to ensure that they have a social tariff. This is because the present structure of tariffs is unfair and discriminates against more vulnerable consumers. Anybody who does not pay by direct debit is at a disadvantage with almost all the energy-supplying companies. A failure to pay by direct debit means that you pay more.
At a more extreme level even than that, those who are on prepayment meters—we have seen the scandals that have appeared in the last few months—systematically pay significantly more than those who pay by direct debit. This is not right. Those consumers are the most vulnerable. In many cases they are put on prepayment meters because they find it difficult to meet the cost. I appreciate that the Government have intervened to ensure that the more draconian measures to force people on to prepayment meters have been tackled, and I thank them for that, but it is still the case that the most vulnerable consumers, using the easiest method for them to pay, pay more than the rest of us on higher incomes. That is wrong. The easiest way to get out of that is to require all companies to have a social tariff, and to ensure that the system of the priority service register, which in theory exists to identify those customers, actually leads to an offer and a supply of a differentially favourable tariff.
The priority registration system was originally to make sure that they were not hit by shortage of supply. It has been used by companies to identify those who are most vulnerable, but it is differentially effective. Our study found that the level of signing up for the priority service was very different region by region and company by company. Also, the use to which it was put was not at all systematically clear. The large number of people who do not know of the register, or that they could perhaps use their presence on it to ask for a different tariff, means that, in essence, people who perhaps are not digitally literate or do not have time to compare the market—or “Compare the Meerkat” or whatever—are doubly disadvantaged with respect to the systems of pricing and tariffs available to them.
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If the Minister cannot say that he will incorporate something like this in the Bill, I hope he will at least give an indication that, together with Ofgem, the Government will at some stage come forward with a new system of tariff structures and requirements that truly and effectively addresses the needs of our more vulnerable consumers; they may be vulnerable by income, the nature of their families, their health or their age.
That is all I am asking. I suspect that the Minister does not want to incorporate it in the Bill but it would be nice if he could give me an indication that, together with the regulator, the Government are at least thinking of better ways to ensure a more socially just structure of tariffs in this country. I beg to move.