HC Deb 27 October 1975 vol 898 cc1001-2
2. Mr. Hooley

asked the Secretary of State for Prices and Consumer Protection if she will ask the appropriate consumer advisory council to investigate the 100 per cent. increase in standing charges for gas and electricity introduced in September by Birmingham City Council.

The Under-Secretary of State for Prices and Consumer Protection (Mr. Robert Maclennan)

I assume that my hon. Friend is referring to the Heating and Rent Payment (HARP) scheme, under which elderly tenants can spread their fuel costs over a year by making a fixed payment for heating, which is collected with the rent. The scheme is entirely optional, and the Birmingham City Council is responsible for payment of the total cost of the fuel consumed under the scheme. I understand that the recent increases were made to reduce the substantial deficits that have arisen since the scheme was introduced in December 1973. The Price Commission has looked into them and has found no reason to intervene.

Mr. Hooley

Does my hon. Friend agree that it is an essential feature of the Government's counter-inflation policy that there should be rigorous restraint on prices as well as on incomes? Is he satisfied with the behaviour of the public corporations in relation to prices to consumers? This is one example that is simply not helping the counter-inflation policy one iota.

Mr. Maclennan

I am aware of the general considerations which my hon. Friend has brought forward, but he will be aware that Birmingham City Council was faced with a substantial deficit, which it was not permitted to allow on the rate fund, beyond that for which provision was made. It was therefore necessary to review the charges to the tenants to prevent there being a deficiency over and above the contingency fund.

Mrs. Sally Oppenheim

In view of the shattering rate of inflation in the public sector and the increasing burden of price increases that have been imposed upon consumers, will the Minister wake up to the seriousness of the problem? [Interruption.] It is nothing to do with the deficit, as the Price Commission has made clear. Will the Minister immediately institute an investigation in order to establish the reason for these very high costs in the public sector and precisely why they are so much higher in the public sector than in the private sector?

Mr. Maclennan

The hon. Lady appears to be talking about something other than what is involved in this Question. There is a specific Question later on the Order Paper about the public sector.