HC Deb 30 January 1984 vol 53 cc4-6
4. Mr. Durant

asked the Secretary of State for Energy how many consumers are being assisted by the standing charges concession.

15. Mr. Parry

asked the Secretary of State for Energy what recent representations he has received concerning the abolition of standing charges.

16. Mr. Greenway

asked the Secretary of State for Energy if he will make a statement on standing charges.

Mr. Buchanan-Smith

The rebate scheme operated by the industries is currently benefiting around 1 million gas, and up to 2 million electricity, consumers. Representations have been received, but the principle and broad level of gas and electricity standing charges have been confirmed by independent consultants' reports.

Mr. Durant

I welcome my right hon. Friend's answer and the help given by the Government in persuading the nationalised industries to lower standing charges. Will he look at the new proposal to read meters only every six months and to do an estimated reading for the other three months, which may cause difficulty for the elderly and those on low incomes?

Mr. Buchanan-Smith

Meter reading is a matter of concern to the electricity and gas supply industries. One does not want difficulties to be created for older people, and I shall discuss the matter with those responsible in the industries.

Mr. Greenway

As each year the elderly pay the equivalent of a month's pension in standing charges, will my right hon. Friend press the industries to abate standing charges for old-age pensioners?

Mr. Buchanan-Smith

As my hon. Friend knows, both the gas and electricity industries already operate rebate schemes which keep the amount of the standing charge to no more than 50 per cent. of the total bill, which is of enormous help. Through the various schemes to give help to those who need it, the Government are spending about £350 million this year. That is probably the most effective way to make sure that help reaches those who really need it.

Mr. Campbell-Savours

Is the Minister aware that it is not only the elderly who have to suffer, but all those on low incomes? Is he further aware that families throughout the country are shivering in the cold and hanging over their fires in the hope that they can gain the necessary heat to keep alive? What is the Minister doing for them? Is it not fair to say that the Government have turned a blind eye to those people's problems?

Mr. Buchanan-Smith

That is absolute nonsense. The hon. Gentleman forgets that if the total cost of standing charges were put on the tariff rate that would bear particularly hard on many low-income groups, particularly those with large families and those who are dependent on only one form of heat, such as electricity. I hope the hon. Gentleman will recognise that when his party was in government it commissioned a report in 1976 called, "Energy Tariffs and the Poor", which stated that abolition would not necessarily help those most in need.

Mr. Rathbone

Will my right hon. Friend reconsider yet again the principle of standing charges, not for emotive reasons, but purely because it is a foreloading charge which does not reflect use and therefore does not encourage conservation?

Mr. Buchanan-Smith

In addition to the report commissioned by the Labour Government, the matter was considered recently in relation to both the gas and electricity industries. Both reports are available in the Library. They show that there is a good and sensible justification for standing charges, but it is important that the level of those charges is watched carefully. It is significant that while there have been recent increases in gas and electricity tariffs, it is proposed that standing charges should not be increased at all.

Mr. Cartwright

Has the Minister seen the evidence produced by Age Concern, and other organisations, which suggests that the Government's 50 per cent. standing charge rebate scheme encourages pensioners to cut down their consumption to try to get the benefit of the rebate? Does the Minister regard that as acceptable?

Mr. Buchanan-Smith

The hon. Gentleman should recognise that there is not just the rebate scheme. As I said, about £350 million is being spent to help the less well off, including pensioners, and many pensioners benefit from that. That shows that the Government are giving the help where it is needed. I hope the hon. Gentleman also recognises that in the November increases the heating allowance was increased by 8 per cent., which was much more than the increase in tariffs.