HC Deb 04 July 1972 vol 840 cc452-62

2.30 a.m.

Mr. Varley

I beg to move Amendment No. 22, in page 20, line 16, leave out from 'shall' to end of line 18 and insert: 'whenever altered be notified by the Corporation to each consumer by means of an individually addressed communication'. The Amendment brings into focus the methods which the Gas Corporation will use when making tariffs known and when changes in tariffs are made. We seek to end the present wholly permissive system under the 1948 Act and place a duty on the corporation to notify each customer individually by letter when tariffs are altered.

I decided to table the Amendment after receiving—on 5th June—a letter from a gas customer in the Eastern Gas Board region and a whole sheaf of correspondence. The circumstances of this case are such that it has general application to all gas customers.

Notification of tariff changes is at present undertaken by area gas boards. The provisions are set out in Section 53(4) of the 1948 Act: Subject to the following provisions of this subsection, the prices to be charged by an Area Board for the supply of gas by them shall be in accordance with such tariffs as may be fixed from time to time by them, and those tariffs shall be so framed as to show the methods by which and the principles on which the charges are to be made as well as the prices which are to be charged"— it is these next words which are permissive— and shall be published in such manner as in the opinion of the Area Board will secure adequate publicity for them. Area boards—certainly this applies to the Eastern Gas Board—interpret those words to mean notifying changes by buying advertising space in local newspapers. When tariffs are changed, it is the practice to include a leaflet in the first account sent to a customer after the new rates have been decided. The words of Section 53 are repeated exactly in Clause 25(3). We think that the words need to be tightened up to ensure that customers are fully aware of the various tariffs available to them and can choose the one which is most advantageous.

In January, 1971, the Eastern Gas Board introduced a new tariff L, which was advertised in local newspapers and in leaflets included with gas accounts. The gas customer I mentioned previously is a relatively large customer, and he complained to the gas board that had he been notified of the new tariff L he would have been able to save £17.62. The gas board replied that the statutory obligation had been met and, whilst it was freely admitted that tariff L was to his advantage, there could be no question of refunding the £17.62. The customer wrote to the Eastern Gas Consultative Council, which endorsed the gas board's decision. He finally wrote to his Member of Parliament, who in turn wrote to the Chairman of the Eastern Gas Board, but again Section 53(4) of the 1948 Act was quoted and it was maintained that the statutory obligation had been met. To be fair, the statutory obligation had been met.

Cannot we frame this new legislation so as to ensure that customers get to know more precisely what are the tariffs and which one will be to their advantage? The Under-Secretary of State might say that newspaper advertising and the inclusion of a leaflet with the gas account are enough but I think that the system could be improved. No one reads all the statutory notices appearing in local newspapers which are put in by rural and urban district councils, county councils, the National Coal Board, electricity boards, water boards and gas boards. The 13 million gas consumers do not scan their local newspapers every week to see whether new tariffs are announced.

It is possible for the leaflet to be omitted from the envelope bearing the account. Many leaflets advertising appliances come with accounts from national boards. These are not scrutinised in detail. The only sensible answer is for an individually addressed communication to be sent to each consumer. We are not suggesting that the Chairman of the new Gas Corporation should get out his quill pen and a bottle of ink and write to every one of the 13 million customers individually when tariffs are changed. Individual communications are sent in the form of quarterly accounts, and the leaflet could be adapted to ensure that customers are aware of the tariffs and able to judge which one best suits their needs.

Assuming that it is not possible to accept the Amendment providing for individual communications to be sent, I put three suggestions to the Minister for his consideration. First, I want him to concede that the present system is unsatisfactory and that repeating the words of the 1948 Act is unsatisfactory. I hope that the hon. Gentleman will consider putting down an Amendment of his own in another place to rectify it. However, if he cannot do that, will he ensure that this matter is brought to the attention of the new National Consumers Council, when it is set up? The third alternative is that the corporation should be asked, when it introduces new tariffs, to give people time to assimilate them and to provide a further retrospective option of a limited duration to ensure that people do not miss the boat.

Naturally, we hope that the Minister will accept the Amendment and that he will say there are no insuperable difficulties involved in sending out individual notices to consumers. Failing that, we hope that the hon. Gentleman will say that one of my three suggestions can be accepted.

Mr. Gerald Kaufman (Manchester, Ardwick)

My hon. Friend the Member for Chesterfield (Mr. Varley) moved his Amendment with the moderation that this House has come to expect. It has not been disappointed. However, the House does not expect such moderation from me. Again, it will not be disappointed.

My hon. Friend said that this matter arose from a specific case but that he drew a general moral from it. I draw a particularised moral from what seems to be a slackness in the drafting of legislation. It will not be good enough for the Minister to say that this provision merely repeats the words of a Labour Government's Act of Parliament. We all have great affection for my noble Friend Lord Shinwell, but I do not think that anyone will say that what Lord Shinwell may have said at any time is necessarily the last word on any matter.

This wording, as it was in the 1948 Act and as it is repeated in the subsection, is nowhere near satisfactory. As in the Sound Broadcasting Bill, we are in the realm of opinion. What is to be done should be in the opinion of the corporation. It means that the corporation may do whatever it wishes and, if challenged, its chairman can say that in his opinion and that of his colleagues in the corporation the publicity is adequate. It could put a handwritten postcard in a newsagent's shop window giving details of its new tariffs. If challenged with this absurdity, the corporation could say that in its opinion, which was all that was required, that was adequate publicity. If it wished, it could place an advertisement in the personal columns of ITmagazine. The Attorney-General might not think that a suitable place, but as long as the corporation said that in its opinion this was adequate publicity, it could not be challenged in the courts or in this House. This kind of drafting has been all too frequent. I fear that the Solicitor-General has had a hand in the drafting of more legislation than we have been told about and that he might have been involved in this, too.

2.45 a.m.

If the Minister is going to tell us this is customary wording, I am afraid it is not satisfactory to me. If he is going to tell us it is Labour Government wording, I shall say that is not good enough for me, either. Labour Governments are superior to Conservative Governments but they are not perfect. If he is going to tell us he has faith in the corporation, and that, therefore, if the corporation says that in its opinion publicity was adequate, it is, then all I am saying is that the case history outlined by my hon. Friend—there must be many other case histories which are submerged—shows that what the corporation alleges is adequate is not necessarily so.

I hope the Minister will accept the sensible words in the Amendment which can be interpreted liberally, exactly as the original wording is interpreted liberally, words which do not oblige a personal letter, typewritten, duplicated, and so on, but could mean a printed communication provided that it is personally addressed. I hope the Minister will make encouraging noises because at this hour it would be a little hard on us to have to trudge through the Lobby.

Mr. Ronald Brown

I should like to support the Amendment. It seems that we ought to make this ordinary requirement on a public body mandatory. It has to inform consumers when it is putting up the charge or making any changes in tariffs.

We have all had the same type of case as my hon. Friend the Member for Chesterfield (Mr. Varley) where public bodies have been able to get out of their responsibilities by arguing that they discharged them according to the Act, but it is unreasonable to expect any customer to search the pages of his local paper, assuming that he buys it. These advertisements are usually placed in the middle of a long series of others advertising a variety of other things. Often a local authority has a whole page advertising compulsory purchase orders, tenders for jobs and a whole range of issues. It is not unusual to find that the gas board and others have their advertisements in the middle, and one has to read the whole lot to find them. It is not right for us as a House to accept that we should write into this legislation any aberrations that the House may have had in past legislation just because it was so.

My hon. Friend made a powerful case drawn from personal experience. It is a clear indication of what is happening. Those of us who have equal complaints from our constituents over the last few years could provide some support. I am not prepared to have just noises. Either those words are not sufficient and the words on the Order Paper are, or we must make our position clear. I hope my hon. Friend will not be upset by the blandishments of the Government Whips' office to pull out.

There has been what is called a dishonourable arrangement. I get tired of arrangements between my side of the House and hon. Members opposite. I just bent down to tie up my shoelace outside when I heard their Whips talking to my Whips about my hon. Friend being persuaded to withdraw. This is an important Amendment. It is important for those people who are customers of the Gas Corporation. They are entitled to be told as a direct contract. If they are in arrears they get a letter pretty quickly as a direct contract. Therefore, where there are any changes in tariffs there is an equal obligation on the gas boards to notify their customers direct. I hope that we shall hear that the Minister has accepted the Amendment.

Mr. Emery

I am delighted to be told that the blandishments of the Whips are affecting the course of the debate. I had not noticed much of that happening. I will not pursue that line as it would be out of order.

I have looked carefully at the Amendment. Even at this late hour, because of the manner in which it has been moved, I must try to put the matter in complete perspective.

Clause 25(3) requires the Gas Corporation to publish its tariffs, as fixed by it from time to time, in such manner as in the opinion of the Corporation will secure adequate publicity for them. The Amendment, if accepted, would specify instead a particular means of publicising tariff changes. The intention to ensure that every consumer is made aware of variations in tariffs is laudable—it is perhaps even more laudable if the tariffs do not affect him—but the proposal bristles with a number of difficulties which even the hon. Member for Shoreditch and Finsbury (Mr. Ronald Brown) would understand.

First, a general tariff change, following the suggestion in the Amendment, would involve sending out about 13 million notifications. This would involve a considerable amount of work, more office staff, and extra expense. That expense would have to be met by the Gas Corporation and would not achieve what is intended by the Opposition.

Mr. Kaufman rose——

Mr. Emery

I will make a point of giving way to the hon. Gentleman when I have finished this line of argument.

This would not necessarily achieve the intention of the Opposition to try to make certain that consumers have the benefit of knowledge of any better rate or alteration in rate which might be beneficial to them. I am not convinced that the Amendment goes to that length.

Mr. Kaufman

The Under-Secretary mentioned expense. Has any estimate been made of the expense so that we can look at it in perspective?

Mr. Emery

Too much. At this hour I think that is an adequate answer. It could be argued that this information might be included with the quarterly bill. If so, we are seeing that with the Eastern Gas Board, to which reference was made. A leaflet about the tariff increase of 3rd January, 1971, was sent to all credit customers with their gas accounts. That was a definite, specific and simple revised gas operating tariff. There is was for them. It is not that that is not done. On 7th January, 1972,obviously in preparation for this Amendment, the board glossed it up a little, and instead of the more formal printed document there was a comprehensive piece of literature which said: Gas tariff for domestic consumers. No changes have been made to the structure of existing tariffs. No new tariffs have been introduced. The Eastern Gas Board was willing to do that just to make certain that its customers understood the situation.

It was the Eastern Gas Board that was being criticised. May I say in passing that I find that criticism less convincing and less worrying when I discover that the person making the complaint is a tax consultant. If he, as a tax consultant, did not bother to find out the change in tariff, I am not all that worried. But that is just in passing.

The situation is that the area board being complained about has gone to considerable trouble to try to ensure that exactly the type of information which is being argued for by hon. Gentlemen opposite is made available.

Mr. Kaufman

The hon. Gentleman is doing his best—and as always it is an agreeable best—to help the House, but I must tell him that what he is saying is convincing me more and more how important the Amendment is. First, the hon. Gentleman has exhibited this leaflet which looks like the kind of leaflet that one gets asking one to have central heating installed. It has a nice picture on the front, and one throws in the wastepaper basket. Secondly, it was not sent when the tariff was changed, and, therefore, there was no obligation on people looking at it to see whether the new tariff would help or harm them. Thirdly, he says, and the House is interested to hear this, that the individual to whom my hon. Friend the Member for Chesterfield (Mr. Varley) referred is a tax consultant. If this kind of thing passes the notice of a tax consultant, what hope is there for the rest of us?

Mr. Emery

If the Gas Corporation were to be under a statutory obligation to notify consumers individually of any alterations in tariff, a consumer might refuse to pay the increased bill, claiming that he had not received notification. Although he would not appear to have any legal right to take that action, it could become necessary for the corporation to produce evidence of posting, or possibly evidence of receipt by the customer, to meet that challenge. That is one of the major difficulties.

Another difficulty arises with pre-payment meters. The gas industry frequently does not even know the names of the customers using certain pre-payment meters where, for example, there have been changes in tenancy. These are most frequent in urban areas in Manchester, London, Birmingham, and so on. Therefore in practice the industry usually secures publicity for its tariffs in whatever way it believes is right.

It seems to me that, if anything, the Amendment does not sufficiently stress that this responsibility is a matter for the corporation to work out, taking account of any of the views of the consumer councils—those views need not necessarily be accepted—and I come to the three alternatives that were put to me by the hon. Member for Chesterfield (Mr. Varley). I am not willing to say that the situation is immensely unsatisfactory. Trying to specify in the Bill particular means of publicity is, perhaps, much too rigid. But I am willing to take the second alternative I was asked to consider, which it seems is not unreasonable, that is, that I should bring to the attention of the new Gas Consumers' Council the concern of hon. Members about this notification. It seems that that is what everyone would want Therefore, I would say that we expect management to be reasonable about this.

3.0 a.m.

At one moment, the argument of the hon. Member for Manchester, Ardwick (Mr. Kaufman) led me to suppose that I had to respond by saying "Yes, but these are reasonable people who want to achieve exactly what we want to achieve." However, if I bring this matter to the attention of the new National Gas Consumers' Council when it has been appointed, asking that body—as I believe is the wish the House and the Gas Corporation, and certainly it would be the wish of the Consumers'Council—to make certain that this notification was done in the ways which were best for the consumer, I have every reason to believe that this would be helpful to the new corporation and to the consumer.

I hope that on this Amendment, therefore, we have been able to bring about a debate which, perhaps being slightly more than probing, has been quite useful. With those assurances, I hope that the hon. Member for Chesterfield will not feel the need to rally the forces, as suggested by the hon. Member for Manchester, Ardwick in order to have to trudge through the Lobby.

Mr. Varley

The Under-Secretary has gone part of the way. In some respects I regret that he half-way identified the consumer who drew this matter to my attention. Originally I had half a mind to give chapter and verse on this case. Perhaps that would not have been a bad thing. But it would have delayed proceedings on the Bill for much longer than was my intention. I should not be tempted to do so now, even though the hon. Gentleman has mentioned the matter. But to reinforce my point, this particular gas consumer claims in this correspondence with the Gas Consultative Council, the gas board and his Member of Parliament that he never received the glossy leaflet to which the hon. Gentleman has just referred. It did not go through his door. It did not get stuffed into the envelope that carried his bill. Consequently this consumer thinks, quite properly, that he is aggrieved.

I am still not entirely happy with the wording in the Bill. It would be proper and within the legislative drafting prowess of the parliamentary draftsmen to form words which would be much more satisfactory than those in the Bill. If that were the case, the Minister could look at the thing to see whether an Amendment could be tabled in another place.

However, in view of the assurance given—and I take it that it was an assurance——

Mr. Ronald Brown

As I suspect what my hon. Friend is about to say, I draw his attention to the fact that whilst the Minister's argument sounded plausible, in that the Minister will get in touch with the boards saying that they ought to do this, that has no validity whatsoever. I beg my hon. Friend to understand that we are the custodians and the protectors of the consumer vis-à-vis this sort of body. Therefore, I beg my hon. Friend to stick to the Amendment. It is a good Amendment. The Minister has not invalidated it in any way. I beg my hon. Friend not to give way to the blandishments of the Minister.

Mr. Varley

It depends on whether the Minister is much more forthcoming.

Will the Minister concede that the wording in the Bill is unsatisfactory? Consumers of gas may be passed by and as a consequence of not receiving a

Question accordingly negatived.

Mr. Kaufman

On a point of order, Mr. Deputy Speaker. May I draw the attention of the Patronage Secretary to the fact that if he has any good sense he will bring 20 of his colleagues in?

Mr. Deputy Speaker (Mr. E. L. Mallalieu)

That is hardly a point of order.

communication will not know that they can take advantage of a new tariff. I must ask the hon. Gentleman to concede that the wording is unsatisfactory. If he says that and that he will consider tabling an Amendment in another place to deal with the point, I will withdraw the Amendment. If he does not say that, my hon. Friend the Member for Shoreditch and Finsbury (Mr. Ronald Brown) will get his way and we shall have a Division. Apparently, we are not to get that assurance. Therefore, we shall have to press the Amendment.

Question put, That the Amendment be made:—

The House divided: Ayes 10, Noes 81.

Division No. 265.] AYES [3.10 a.m.
Brown, Bob (N'c'tle-upon-Tyne,W.) Kaufman, Gerald
Brown, Ronald (Shoreditch & F'bury) Palmer, Arthur TELLERS FOR THE AYES:
Cocks, Michael (Bristol, S.) Skinner, Dennis Mr. Tom Pendry and
Garrett, W. E. Stoddart, David (Swindon) Mr. J. D. Concannon.
Golding, John Varley, Eric G.
NOES
Allason, James (Hemel Hempstead) Hawkins, Paul Roberts, Michael (Cardiff, N.)
Atkins, Humphrey Hill, James (Southampton, Test) Roberts, Wyn (Conway)
Benyon, W. Howell, Ralph (Norfolk, N.) Rost, Peter
Biffen, John James, David Sharples, Richard
Biggs-Davison, John Jopling, Michael Shaw, Michael (Sc'b'gh & Whitby)
Boscawen, Robert Kershaw, Anthony Shelton, William (Clapham)
Bowden, Andrew King, Tom (Bridgwater) Sinclair, Sir George
Bray, Ronald Kinsey, J. R. Soref, Harold
Brocklebank-Fowler, Christopher Knight, Mrs. Jill Speed, Keith
Brown, Sir Edward (Bath) Le Merchant, Spencer Sproat, Iain
Chapman, Sydney Luce, R. N. Stanbrook, Ivor
Clegg, Walter McNair-Wilson, Michael Stokes, John
Cockeram, Eric Montgomery, Fergus Stuttaford, Dr. Tom
Cooke, Robert More, Jasper Sutcliffe, John
Crouch, David Morgan-Giles, Rear-Adm. Taylor,Edward M.(G'gow,Cathcart)
du Cann, Rt. Hn. Edward Murton, Oscar Taylor, Frank (Moss Side)
Edwards, Nicholas (Pembroke) Neave, Airey Tebbit, Norman
Emery, Peter Noble, Rt. Hn. Michael Thomas, John Stradling (Monmouth)
Fidler, Michael Normanton, Tom Tugendhat, Christopher
Fortescue, Tim Oppenheim, Mrs. Sally Waddington, David
Fox, Marcus Osborn, John Walder, David (Clitheroe)
Gibson-Watt, David Parkinson, Cecil Winterton, Nicholas
Goodhew, Victor Pink, R. Bonner Woodnutt, Mark
Gower, Raymond Proudfoot, Wilfred Worsley, Marcus
Gray, Hamish Pym, Rt. Hn. Francis
Grylls, Michael Raison, Timothy TELLERS FOR THE NOES:
Hall, Miss Joan (Keighley) Reed, Laurance (Bolton, C.) Mr. Hugh Rossi and
Hall-Davis, A. G. F. Rhys Williams, Sir Brandon Mr. Kenneth Clarke.
Hannam, John (Exeter)
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