David Amess

Conservative Party | Southend West

Energy Prices

3. Mr. David Amess (Southend, West) (Con): If he will make a statement on recent increases in energy prices. [51998]

The Secretary of State for Trade and Industry (Alan Johnson): The recent increases in energy prices are causing great concern, particularly in relation to their impact on industrial competitiveness and fuel poverty. Prices are rising mainly as a result of increasing oil prices, leading to higher wholesale gas prices, and higher international coal prices. I can assure the House of our determination to reduce the impact on those least able to cope.

Mr. Amess: As the sponsor of the Warm Homes and Energy Conservation Bill, now enacted, which committed the Government to eliminating fuel poverty within a set period, does the Secretary of State share my concern that gas prices have increased by 38 per cent. and electricity prices by 30 per cent. since October 2003, pushing another 200,000 people into fuel poverty? What does he intend to do to address that very worrying trend?

Alan Johnson: The hon. Gentleman is absolutely right to raise this issue. I congratulate him on his sponsorship of the Warm Homes and Energy Conservation Bill in 2000. Fuel poverty is the most serious consequence of rising gas prices. We have had great success in pulling more than 4 million people out of fuel poverty, but the fact that it is defined as fuel taking up more than 10 per cent. of one's income automatically means that people on fixed incomes, particularly pensioners, will get pushed back into fuel poverty, so those figures are bound to rise.
 
We have to put more money into the projects that help people to tackle those problems. My right hon. Friend the Chancellor of the Exchequer announced in the pre-Budget report an extra £300 million for this area, £250 million of which will be dedicated to the Warm Front campaign in England. There will be a total of more than £800 million. We need to ensure that elderly people use the helplines that are set up to give them advice on what to do. We also need to give them the confidence to switch suppliers, because doing that, in our competitive environment, can save up to £60 per year, which is significant for the kinds of people who are particularly affected. We have to consider those and a whole range of other measures, including the winter fuel allowance, which my right hon. Friend the Chancellor has announced will be in existence for the whole of this Parliament. Those are all crucial issues. The hon. Gentleman is absolutely right to raise the matter and to try to ensure that we tackle this difficult problem.