Fairer conditions for energy customers announced by Ofgem

January 3, 2014

Ofgem’s reforms for the energy market sound very sensible. According to the announcements made by Ofgem today, energy suppliers will now only be able to offer four tariffs for gas and four tariffs for electricity. Complex tiered tariffs will be banned and only one tariff structure will be provided which will comprise a standing charge plus a unit charge. Cash discounts will provided for those customers who have dual fuel (gas and electricity) accounts from the same supplier and who manage their energy accounts online. Ofgem is also seeking to ensure that energy bills are easier to understand and by the end of March 2014, energy suppliers will now have to provide bills which show key information about a customer’s tariff and the amount of energy used in each bill.

Importantly, new standards of conduct were brought in last August by Ofgem so that consumers receive fairer treatment and in addition to these, other measures that have been introduced mean that suppliers will not be able to alter any fixed term deals which consumers entered into on or after 15 July 2013, either. I understand that energy suppliers will now be required let their customers know in advance of any price changes and also provide notice 42-49 days before the end of a fixed term tariff. Those customers who choose not to switch tariffs will then be automatically rolled onto the cheapest standard tariff provided by their current supplier.

I think these measures which have been announced by Ofgem are long overdue. Many of my constituents have found their energy bills difficult to understand for some time and a uniform tariff structure coupled with bills that are clearer to interpret will surely make their lives easier. I am also glad to hear that those customers who at the end of their contracts do not choose to change tariffs, will now be moved onto the cheapest standard rate tariff.

Insecurity from Cradle to Grave

March 20, 2009

Labour’s New Take on Beveridge

There is a danger that all the Government’s efforts to bolster the economy will be engulfed by rising unemployment and the collapse in consumer confidence. We hear a lot about business confidence, but it is consumers who buy the goods and services and if they are so frightened that they stop spending, the situation plummets ever faster downwards.

When President Franklin D Roosevelt (FDR) was inaugurated on 4th March 1933, it was against the background of the Wall Street Crash and the deepening Depression. His famous speech on the theme “the only thing we have to fear is fear itself” outlined that his central aim was to rebuild consumer confidence and he succeeded. He was a new leader and he demonstrated firmness of purpose with a clear sense of direction and optimism, although I should say that a lot of the myths about FDR’s New Deal are wrong. The Americans did not have many shovel-ready New Deal schemes—to use the jargon of the time. But people believed that at last there was a workable plan and steady leadership and confidence returned leading to a revival of fortunes. When we look at the problems of the 1930s and what President Roosevelt did, we find that confidence was right at the heart of what he achieved.

How can you have confidence in Britain’s current leadership? In the Brown Recession, Government bungling has led to a sense of insecurity for all ages. How ironic it is, given Labour’s history, that their new take on Beveridge seems to be ‘Insecurity from the Cradle to the Grave.’ It’s not just that they contributed to the crisis by their raid on pension funds, failing to regulate the banks properly, by borrowing too much and encouraging the public to max out on credit, it’s also the drift over Northern Rock, the inadequate rescue packages for the financial system and the mess over Sir Fred’s pension. It all looks like an amateur production and the impact hits all ages, damaging confidence.

A child born today is already saddled with £17,000 of Government debt. Youth unemployment has risen since 1997 and long-term Youth unemployment will rise faster during the recession. Fathers and mothers face massive job losses. The most recent month’s rise in unemployment at 0.5 per cent is the worst on record. Experts expect unemployment to rise from 2 million to over 3.1 million and reach the highest ever level within a year or so. Yet, the Government just does not get it. The night before the dreadful figures were released, James Purnell MP, Work and Pensions Secretary was reported in the Evening Standard as saying that unemployment was rising more slowly than in the previous recession. Over 500 Jobcentres have closed in recent years and the Government is not ready for the unemployment challenge.

As jobs go and credit is tightened, home repossessions are rising. In my local County Court, the number of Court days available for repossession cases has trebled in recent months.

With very little return on savings, pensioners are badly hit and pension funds’ losses on the Stock Market are worrying for those about to retire. Many may have to look to the Pensions Protection Fund for help if their employers go bust. The Woolworths’ scheme may already be heading in that direction. Over coming months some of our largest pension schemes will have their three-yearly valuations and there will be big deficits. We must just hope that these do not push more companies under or lead to levies on good pension schemes to meet the losses of the bad. The Government has promised to make more substantial increases to the State Pension in the future, but no one knows when. In the meantime they keep using sleight of hand to subtly reduce benefits whilst simultaneously announcing generous sounding increases. So, this year we have seen the Savings Credit cut back, National Insurance Contributions increased, the Carers’ Allowance earnings threshold frozen and no proper recognition of the true rate of inflation for pensioners.

And the actions of Government have been baffling. How can the Government adopt the rhetoric of FDR – New Deal-style infrastructure projects and all – and then suspend 100 of the FE Colleges’ building schemes? At North Herts College they have a “shovel-ready” building scheme with builders ready as promised and now it’s on hold with no visible strategy for the way forward. Many are suggesting that we could tackle fuel poverty and provide energy and environmental benefits by undertaking insulation and Green energy projects, but the Government has rejected the proposals.

We have heard much from Government schemes about how they will help business, such as the Working Capital Scheme, their loan guarantee scheme, jobs schemes, mortgage help schemes, but none are delivering as they should and many have not even started months after the press announcements.

Since November, Conservatives have been calling for a substantial Loan Guarantee Scheme to help small and medium size businesses secure the credit lines they need to retain jobs and stay afloat. The Government have promised to do something, but months later there is no action on the ground. This just will not do. Every month that passes means businesses and jobs lost and confidence eroded. The danger is that with all ages fearful of job losses, home repossessions, incomes in retirement and a slow unsteady Government response, the situation will continue to go from bad to worse. The time has come for new leadership in Britain and a real sense of policy direction coupled with the ability to get the job done. It’s time for the Conservatives to undertake our historic mission of clearing up the mess left by Labour.

Securing a warm house this winter

January 12, 2009

Thank goodness it’s finally begun to warm up.  I for one had had quite enough of that icy chill in the air.

For many the cold snap will inevitably mean higher fuel bills, and I worry that it’s the most vulnerable who will be hit hardest. Over the past few days I have spoken to pensioners in Watton at Stone and Letchworth Garden City about the cost of keeping warm with the cold weather affecting their health and weekly budgets. Indeed I have written to Chancellor Alistair Darling about this.

 We’ve all seen fuel bills rise, but they do not seem to come down quickly enough when wholesale costs fall and despite the Government making some money available for things like insulation, ultimately what we need is lower fuel costs in the first place. The Government needs to sort out its energy policy.

 The Government didn’t want to debate energy policy last year, so it was left up to the Conservatives to arrange a debate on energy security, which we did in June. During the Opposition Day Debate I drew attention to the dire state of the Government’s record on renewables compared with other countries. There’ve been a lot of technological advances made in this area recently (carbon capture and storage, combined heat and power, solar and wind technologies have achieved much greater efficiency), many of them made by British companies, yet the UK has hardly begun to take advantage of them because the Government has consistently failed to make decisions and set a clear course.

 Hopefully Ed Miliband’s new department of Energy and Climate Change will mark a change in Government policy. As this recession kicks in people are going to find it harder than ever to pay their bills, and the Government should respond to this by making the effort to get our energy policy right sooner rather than later.

 Of course much of this pain could have been avoided if only they had fixed the roof when the sun was shining – they could have added a couple of solar panels while they were at it.

How much? (From the archives)

October 10, 2008

The £500 billion package to underpin the high street banks could – if things go wrong – mean taxpayers spending an average £16,000 each on the bail-out. These are enormous sums and we must hope the plan works. The interest rate cut was co-ordinated with other governments and is also designed to give lending a boost.

Why does saving the banks matter? The fact is that credit makes the economy tick and without some bank lending jobs will be lost, wages not paid and the value of our country’s assets will diminish as investment dries up. In recent years credit has been handed out too easily, so building up the economy on a debt bubble. But the banks are not sure now what debts are good quality and likely to be repaid.

The sad truth of this episode is that it is the taxpayer, not the Government or those who made rash lending decisions, who is bailing out the banks. Conservatives are helping the Government to try to sort out the mess and supporting their measures in the national interest, but there are many questions to be answered in due course about how we ended up here.

Finally, and you may be getting a little tired of hearing this, but what about the “moral hazard” of bailing out the very people who helped orchestrate this disaster? There is a serious danger present in mitigating all risk, this bail-out threatens encouraging the very recklessness which got us in this trouble in the first place. The Government must ensure that is not the effect.

Moving House (From the archive)

July 3, 2008

This week we’ve also been trying to sort ourselves out in our new home in Royston.

We had mixed feelings as we left the house that has been our family home for 25 years. Naturally we had many happy memories of the children growing up there, but they have moved on now and Christine and I felt we should “downsize” a bit.

Moving into our new home, makes me think of all the new couples wishing to buy their first house and start their own family, and I worry for their chances. It is of great importance that we create a country which gives young people the same opportunities we once had.

I like our Conservative pledge to abolish stamp duty on homes under £250K for first-time buyers, I think that would really help in our area.

For now though I am trying to learn about growing vegetables, as we have inherited a well tended vegetable patch at the new place.