HC Deb 14 June 1995 vol 261 cc792-3
19. Mr. William O'Brien

To ask the President of the Board of Trade if he will initiate a full investigation into the standing charges on domestic gas, electricity and telephone accounts; and if he will make a statement. [26823]

Mr. Page

Standing charges are a matter for the utilities and their regulators.

Mr. O'Brien

Because of the evidence now available that the abolition of standing charges will reduce the average domestic gas bill by 3 per cent. and the average electricity bill by 6 per cent., and given that many pensioners and people on low incomes would welcome a reduction in their bills after the imposition of VAT last year, will the Minister influence the regulators to justify, qualify and investigate standing charges for all the utilities—electricity, gas, water and telephones?

Mr. Page

While the hon. Gentleman makes his point, I must draw to the House's attention the fact that standing charges are a fair way to recover fixed charges such as meter readings, administration and emergency services. As my right hon. and hon. Friends have already pointed out, consumers can take comfort from the fact that gas prices have fallen in real terms by 23 per cent., BT's main prices have fallen by 35 per cent. and electricity prices have fallen by 8.5 per cent. That is real help to the consumer.

The answer to the hon. Gentleman's question whether I would be prepared to influence the regulators is: absolutely not. The regulators' independence is their strength.

Mr. McLoughlin

Does my hon. Friend agree that standing charges have fallen, as a number of companies have announced reductions? Will he confirm that there is nothing new about standing charges, which have been around since before 1979? The Opposition say that they should be abolished. Their hypocrisy is there for everyone to see.

Mr. Page

My hon. Friend is right. Since 1993, MANWEB has abolished its standing charges. While the future players in the gas market have not yet revealed their strategies, I have no doubt that they will consider reducing or abolishing standing charges once the Gas Bill is enacted.

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