§ 6.26 p.m.
§ Lord FERRIER rose to ask Her Majesty's Government whether they propose to take further steps to encourage the increased use of electricity for domestic space heating. The noble Lord said: My Lords, I beg leave to ask the Unstarred Question which stands in my name on the Order Paper. Your Lordships will see that I have used the word "further" in my Question. This is because, in debating and passing the Homes Insulation Bill, with its attendant grants, last July, a significant step was taken in conserving energy for space heating. All space heating, of course, is concerned with the matter of insulation. But it is about electricity for space heating, and especially the storage type heater consuming off-peak power, that I am particularly concerned, and your Lordships may well wonder why.
§ It happens that in the 'thirties and 'forties I had some experience of electricity supply, and 20 years ago it was clear that the off-peak storage heater was—as it still is—intrinsically a most efficient appliance. It is an appliance desirable, not only to the user, provided the tariff is low enough, but to the supply system, by taking power when other outlets are switched off—filling the valleys as they call it in the industry, in the load curve, both by night and in the middle of the day.
§ But there was a snag. Twenty years ago those appliances were not available to the domestic market. Why? It was because they would thus have become liable to purchase tax of 25 per cent., which made it a nonsense. By a process of speeches and Questions in your Lordships' House extending from March 1959 to somewhere in 1962 or 1963, we were able to get this appliance freed from purchase tax. The tax was removed, whereupon—I believe quite rightly, though they have been criticised since—the electricity authorities initiated an advertising campaign in order to build up their off-peak load. They pushed the advantage of this 1057 appliance, but little did they know—nor did I, nor did your Lordships—that the cost of fossil fuel was going to soar to the level it has reached today. The resultant inevitable rise in electricity tariffs was so severe a blow to consumers who had just invested capital sums in space heating equipment that many felt that they had been swindled, and said so. The efficient, almost everlasting, convenient, clean, safe appliance got a bad name, perhaps understandably but quite undeservedly.
§ No longer could the hitherto prodigal use of energy be contemplated—and never will be again. Whole housing schemes based on electricity for heating and cooking have become a problem in themselves and so on and so on. The manufacture of night storage heaters virtually ceased and some of the companies involved went into liquidation. My involvement with the whole thing has, therefore, given me almost a guilt complex. That is why I raised the matter in our debate on the Address and, as I said I would, put down this Unstarred Question today; because the winter is upon us. That is why I put it on the Paper as soon as I got the chance.
§ Something can well be done to dispel the doubts which still exist about electrical space heating where electricity is the only source of supply. This is very much the case in Scotland. My investigations suggest that the noble Lord, Lord Strabolgi, in his reply to which I look forward with great interest, is going to dispel the anxieties which still exist. Talking of interest, I must declare one. I have five night storage heaters in my little house, and in Scotland, and they are of the original type; that is, requiring a midday or an "afternoon" boost. To get that, my tariff is slightly higher than the off-peak tariff which has not got the afternoon boost; but, so far as I am concerned, it is a balance which is worth while even at todays' tariffs.
§ It is not my intention to start developing the numerous technical details of tariffs and circuits, white meters and Economy 7s, monitoring gadgets, spring-loaded clocks and so on, all the adjuncts to an efficient use of off-peak electricity. Suffice it to say that the passage of time has compelled us to grasp that energy costs will never again be low and, as I said before, never again will we be prodigal in our use of 1058 heat—whether centuries ago it was through firewood or, in the last century, through coal. Thus, conservation, insulation and various economies are bringing the night store back into the picture again.
With respect, I feel that the Electricity Council misjudged the feeling of consumers when they launched the advertising campaign which they did at the beginning of this month, a capaign which called forth some criticism from the Electricity Consumers' Council and they, in a Press release dated 7th November, said:
The Electricity Consumers' Council, with the 12 Area Electricity Consultative Councils in England and Wales, has been monitoring the Economy 7 campaign and its impact on consumers. It has evidence of considerable confusion amongst consumers as to whether or not they will benefit from changing to Economy 7".
Let us hope that this debate may go some way to resolving that confusion. I am glad to see the noble Lord, Lord Taylor of Blackburn, in his seat. He is chairman of the North Western Electricity Consultative Council. I hope that it is possible that he may make some contributions to our considerations tonight.
§ As I have said, the technical complexities are immense because conditions vary so much from area to area. The problems in his area vary from ours in Scotland and vary very much from those in southern England. Tariffs vary accordingly. Scotland's approach to tariffs necessarily differs from England's. For instance, the much-discussed "Economy 7", which I have just been speaking about and which is being advertised today, does not apply in Scotland. In some places, fuel charges are superimposed upon the tariffs and, in others, the fuel charges, the surcharges, are absorbed in the tariffs themselves.
In general terms, my impression is that the Electricity Council are "on top of the job" but with many a problem still to overcome. The new Electricity Consumers' Council—and I cannot quite make out whether or not it is a QUANGO—is making its contribution. I am grateful to them for the help that I have had in preparing for this debate. But winter is upon us and while the experts are applying their minds to electrical matters, what about the social backgrounds? I feel that in this connection I should like to quote again from a Press release by the Electricity Consumers' Council where they say,
quoting the Chairman, Mr. Barnes:
'Fuel poverty' is not the responsibility of the industries, it is the Government's responsibility. If fuel prices rise above what certain sections of the community can afford, then the Government must step in to ease the situation".
These are his words.
The Supplementary Benefits Commission clearly think, that the present arrangements are inadequate and, with fuel prices likely to double in real terms"—
I hope not! but that is what he says—
by the year 2000, I am sure that they are right to advocate a national fuel rebate scheme".
§ This is complicated by the attractive and important contribution which gas makes to the nation's comfort—wherever it is available. And this is my point; it is not available everywhere. Where it is, it is unquestionably, at present rates, the most economical space heating medium for the ordinary domestic user. It follows from the fact that it is difficult to distribute, that gas is very largely an urban facility, at least confined to areas which are fairly densely populated. It is in the areas where there is no gas supply that hardship is arising because of the cost of electricity.
§ Thus, my Lords, I turn in conclusion to the social angle. Are the Government satisfied that everything possible is being done by the local authorities in whose hands lie the social and welfare services? Is the 25 per cent. rebate scheme, for instance, being developed adequately? The relaxation of disconnections for nonpayment which has been undertaken now is all very well; but a relaxation of disconnections may be only deferring the evil day. Government are helping by grants for insulation under the Act to which I referred earlier. Can they help further by grants for capital expenditure on heating units?
§ What about the expense involved in replacing the old units which will not be economic under Economy 7 because of the absence of the mid-day boost? One thing that worries me is this: do the really needy people, the poor people, know of the availability of facilities which exist? Are there still too many old folk who are too proud to say that they are cold? Can they be kept better advised of the opportunities which are open to them? In the other place the other day it was stated that millions of pounds, that are available for assistance, are not spent because the 1060 money is not claimed. Is it possible that more would have been claimed if more people had been aware that it was available?
§ One idea which I promulgated some time ago was that the profits from gas might be used to subsidise electricity tariffs. That appears to be a non-starter; it is not possible under the law. Well, can the law be altered? Is it, my Lords, altogether a non-starter? In saying that I turn to the Energy Commission of which the Minister for Energy is chairman. Are that Commission addressing themselves to the overall problem of domestic heat from whatever source? Can they evolve a national scheme such as the chairman of the ECC visualises?
§ There are all sorts of different ways in which electricity can be used: hot air circulation, under-floor heating tariffs, basic heating for blocks of flats with the provision of heat added to the rent; and there is the provision for heating of churches and halls. I was chairman of a company and we equipped the warehouse with off-peak heaters with great economy. It is worth stressing the value of this system when safety and cleanliness are important factors.
The Electricity Consumers' Council issued a Press release only yesterday which welcomed this debate. That is gratifying. It contains a background note which reads as follows:
Night storage heaters, introduced as an economical form of heating, diminished in popularity when the price of electricity rose in relation to other fuels. There are some indications that many are either unused or being replaced by other forms of heating".
§ That may well be so. It would be ungracious of me if I did not acknowledge the assistance that I have received from the marketing adviser, Dr. Gronow, of the Electricity Council. Among the mass of information with which he has been good enough to provide me is the interesting fact that no matter how true it may be, as the ECC have suggested, that these heaters are not being used, the fact of the matter is that the midday valley in the typical load curve of today has vanished. He attributes the disappearance of that valley to the continued use of storage heaters with the midday boost.
§ I dined the other day with a neighbour, a Member of this House, and I saw that there were night storage heaters in the 1061 rooms. I was told that they had not been used for years but served as an interesting piece of furniture on which to display the beautiful needlework that her Ladyship had sewn. My neighbour said: "It does not pay to use them". I wonder whether, as time goes on, my Lords, it will soon be worthwhile to make use of these attractive appliance. My Lords, I beg to ask the Question.
§ 6.45 p.m.
My Lords, I am sure noble Lords are grateful to my noble friend Lord Ferrier for asking this important technical Unstarred Question. He has been doing this for a number of years now and I gather that my noble friend made his maiden speech in this House on the subject of night storage heating. Annually, at this time of the year, he asks this Question in order that we all may keep our eyes on a very important type of heating. I congratulate him on once again raising this question and what he has said to the House this evening.
Of course, a number of factors are involved in this subject. My noble friend quite rightly drew attention to the fact that here is a type of heating that could bring warmth and comfort to the older generation. He also noted that winter is coming upon us. I felt a slight shiver going down my spine, and I was only too grateful to know that your Lordships' House now has a new type of heating. Unfortunately, it is not night storage heating; it is oil-fired. I do not think that the winter months in your Lordships' House will be as cold as my noble friend thinks it might be outside.
Night storage heating—or space heating as my noble friend has described it—came in a number of years ago. There was every reason and need for it. He mentioned that this was the latest type of heating. That drew my attention to one fact: the old-fashioned heating for beds was, I believe, a bed pan with red hot coals in it. I have a feeling that when I was a child a hot brick wrapped in a cloth was put in my bed. That was very warming. Night storage heating is a sophisticated type of unit containing bricks which are heated by electricity. It is based on the same principle of the bricks being heated and then gradually cooling.
The idea behind this was to economise on energy—quite rightly so—and to be 1062 able to use an energy-consuming machine for heating a house or offices at an off-peak period when no one else was using electricity. That was a sound idea. Equally, by doing so houses could be heated at a lower cost.
Those two factors were the important parts of night storage heating. Everybody welcomed the advertising and the electricity Board's way of putting it on to the market. The public took it up and were more than grateful for it. We had a number of these appliances in my old house. But if by chance this type of heating was installed in too small a room one could not cool it down. The appliance cools down over a number of hours. One could not use the room because it was too hot. Nevertheless, it was a good, sound idea of heating a building. The economy was such that the public liked the way that they were being charged for it.
The tragedy that happened, of course, was what my noble friend mentioned—that no one in the wide world knew at that moment, some 10 or 15 years ago, that there would be an explosion in the cost of fuel. The electricity Board having advertised and sold these appliances, quite rightly, found themselves pushed into a corner and faced with having to put up the cost of night storage heating. That was one thing by which the public were taken aback; they did not like it. None of us liked it. But they forgot that it was not the fault of the electricity Board. Unfortunately, I do not think that public relations got through quickly enough, and the public therefore blamed the electricity Board for pushing the prices up. They went as far as saying that it was a "con trick", and I seem to remember my noble friend saying something along those lines when he raised the question last year. It was a tragedy that the public should have been thinking in those terms.
The electricity authorities, as I say, were compelled to put up the price of this heating, but in so doing they tried to compromise over the hours; they tried to alter them. At that stage I had sold my last house, which had space heaters, so I do not know quite how the hours worked out. However, I have a strong feeling that the relevant period lasted from 11 or 12 o'clock at night to 7 o'clock the next morning. I am not absolutely certain of what happened there, but they tried to 1063 compromise on a few hours. Equally, they also tried to cut out the mid-day heating in some areas. That, again, I do not think disturbed the market too much. I believe that people still kept their units going, though my noble friend has said that he has met friends who have not used them since. I believe this is still the cheapest form of heating. As I say, a compromise was attempted by altering the hours so that we were all able to get up in the morning and be warm. In some areas they had a booster from mid-day to 3 or 4 o'clock.
Then came the other question. Those who had old units could do that, but those with modern units could not. Therefore, those who wanted to go into this type of heating found the modern super-units too expensive. So we are really back to square one. People either are not sure about this type of heating or cannot afford to use it. If the electricity authorities were given the chance again to advertise these units and, in so doing, were allowed to give grants and also allowed to make sure that new houses and new factories had this type of heating put in at the time when they were built, and not afterwards, I believe this market would come back. I think there is a great deal of reason for it to go on.
My noble friend has covered this subject from Scotland right down to the South of England, and I believe that each region has a different tariff in one way or another. I stand to be corrected on that, but I believe they all differ. My noble friend also mentioned that there are other types of heating. Yes, there are, but you cannot put gas into a small village where it would cost far too much to do so. You can put in a gas pipe only where you can be sure of getting your return. Oil is now too expensive, and so what I should like to see happen now is further investigation. Further experiments ought to be made to try to find the right unit. I think personally that this space heater is the right unit, but it ought to be improved and if it is too expensive the cost should be looked into. There might also be a scheme of grants or a scheme which would help people to be able to buy these units, where necessary.
The subject is technical enough; it is interesting enough. If we can bring 1064 compassion and warmth at a low cost to the old people, that is good. If we can encourage the Government to encourage the electricity authorities to come together on different schemes, I believe there is still a big market and a big hope for this particular type of space heating. I congratulate my noble friend once more on raising the subject again.
§ 6.55 p.m.
§ Lord BURTON
My Lords, may I intervene briefly to make two small points? Every time there is refrigeration, heat is extracted and very often—more often than not—it is dissipated. It is now possible to get heat conversion units, and once more the farming industry seems to lead the field in this. For example, a farm dairy, where milk has to be cooled, has heat extracted and it is now possible to convert that heat and use it for heating water for washing cows or dairy utensils, and so on. Most houses have refrigerators and deep freezers. When these work they are putting out heat. The heat may not be very large, but I think that there should be further development done on this and further use made of such conversion units for the general and more economic use of electricity.
The other point is a more general one. Things may have changed, although I suspect they have not changed very much. When I was a county councillor I suggested that night storage heaters should be used in our schools. In those days it seemed to be largely a matter of the opinion of individual councillors as to what sort of heating should be installed. There seemed to be no professional advice which could be secured on a totally unbiased basis as to what sort of heat should be used in these cases. Some people favoured oil and others favoured electricity in one form or another. There were choices of oil, electricity, gas or even solid fuel, with variations in each sort of fuel. Indeed, there were numerous electrical gadgets, including night storage heaters. Each agency tried to sell its own commodity, and I am not aware of any method by which the average layman can get unbiased advice on what to use.
While appreciating that the situation may vary from year to year and from area to area, as the noble Lord, Lord Ferrier, said, surely some general lead should be 1065 given by the Department of Energy. If such a guide is available, then it is important that the general public should be better informed as to where it is available. I think we have been told this evening about the old-age pensioners not being able to get this sort of advice. It should be available. If energy is to be conserved, it is also important that the most efficient fuel and the most efficient use of that fuel is adopted as widely as possible. There have been lengthy inquiries about the best methods of generating electricity and differing views have been expressed; but surely it is not difficult for experts to tell us—it should be a comparatively simple matter—whether or not night storage is a good thing for the consumer and the national energy policy. Instead of getting a lead from the Government, it seems that my noble friend has to bring up this matter time after time, and many of us have not got the expertise which my noble friend Lord Ferrier has in this matter. I do not seek any answer from the Minister tonight, but I do feel that these are matters which should be examined at Government level.
§ 6.59 p.m.
§ Lord SWINFEN
My Lords, may I make a couple of points before the noble Lord replies. I spend my time trying to sell houses, and houses that are heated with electrical night storage heaters or other forms of storage heat are often difficult to sell. It is not only the cost that worries prospective purchasers. It is, to a large extent, the control of the heat output. When there is a winter with changeable weather, and there is a fine day following a cold spell, you will find that the houses are overheated because there is at present no real method of slowing down the output of that heat. Again, if there is a cold spell following a warm period, there is no method by which the house can be heated in a hurry without using other types of fuel or electric fires. I wonder whether the noble Lord, Lord Strabolgi, can tell me when he replies—if he does not know the answer now, perhaps he can write to me later—whether there have been any improvements in the way in which the output of heat can now be controlled.
Another point that is worth mentioning is that when the weather gets cold, or at peak periods during the day, people still require electricity for heating. Are there 1066 any developments in the domestic storage of electricity, so that houses can take a supply of electricity and store it during off-peak periods, or even, on a longer scale, during the warmer months of the year, and use that electricity when required?
§ 7.1 p.m.
§ Lord STRABOLGI
My Lords, I should like to join with the noble Viscount, Lord Long, in congratulating the noble Lord, Lord Ferrier, on once again raising this very important subject. It is one which he has made very much his own. I am very glad that he has returned to it again this evening, and I should like to say how much I appreciate the constructive approach of his speech. I am also very glad to see here my noble friend Lord Taylor of Blackburn. He tells me that he cannot take part in this debate, which he is of course well qualified to do, as he has not yet made his maiden speech. So that he is very properly reserving that for the full occasion. But I think I speak for all your Lordships when I say that I hope we shall have the pleasure of hearing from him soon.
This debate has raised many questions about the electricity supply industry's policy on off-peak tariffs, and the Government's position regarding the encouragement of greater use of electricity for domestic space heating. In general, the Government believe that, so long as the price of each fuel is sensibly related to the full cost of supply, consumers should have the freedom to decide which fuel best suits their particular circumstances. Consumers will naturally seek the best possible advice about likely price movements over the medium and longer term, but these will depend, in part, on the movement of prices in the world market. At the same time, the nationalised fuel industries should provide for the generation of funds for future investment.
The suggestion has been made that the gas industry should subsidise the sale of off-peak electricity. There are at present no statutory provisions which would permit the direct transfer of profits from one nationalised fuel industry to another. For the gas and electricity industries, future profit levels are largely determined by the future level of prices, and in discussing these with the industries the 1067 Government have in mind their general policy objectives, including considerations of social, and counter-inflation policy, and overall energy policy as well as the need to cover costs.
Within the overall level of prices, the industries should pay attention to the structure of prices and its relation to the structure of costs. Arbitrary cross-subsidisation between different groups of consumers should be avoided wherever possible. To ensure that this is happening, the Government must satisfy themselves that the main elements of an industry's price structure are sensibly related to the costs of supply and the market situation. Subject to this, the Government believe that it is mainly for each nationalised industry to work out the details of its prices with regard to its markets and its overall objectives, subject of course to the general considerations that I have mentioned.
The noble Lord, Lord Ferrier, asked specifically whether the Government should use the profits of the gas industry to subsidise off-peak electricity prices. As I said, the first call on any profits made by the British Gas Corporation is reserve. The Government have no power to use them for other purposes. It may be asked why we cannot use Section 16 of the Gas Act to require them to pay over excess profits. I should like to put it on the record that Section 16 applies only to profits made directly from the British Gas Corporation's offshore operations—not to profits made from distributing gas—and because of high exploration and development costs the British Gas Corportion is not yet making significant profits from its offshore activities. It is, however, an interesting suggestion in the longer term, and it is not one to which the Government have a closed mind, by any means. I will bring what the noble Lord, Lord Ferrier, with his great knowledge, has said to the notice of my right honourable friend the Secretary of State.
§ Lord STRABOLGI
My Lords, I appreciate that. Against this background, the electricity supply industry has for a long time sought to base its tariffs on the costs of supply, seeking to ensure that 1068 different classes of consumer, or consumers with different consumption patterns, pay charges that correspond to the differential cost of supplying them. Clearly, there must be a limit to the complexity of the tariffs that result from these considerations. At the extreme, every consumer's demand imposes different costs upon the system, as everybody's habits will vary, but it would be nonsensical to charge every consumer on an individual tariff. The structure of tariffs therefore reflects the general demand characteristics of groups of similar consumers in a workable way.
The relationship of one tariff to another depends to a great extent on the daily electricity load curve. If you happen to want electricity during the day, when most other consumers want it, you pay the rate associated with the amount of plant and the costs of running it applicable at that time. At night, demand is much lower, and much of the plant needed during the day is not generating. Reflecting the lower costs that a night-time demand makes on the system, night prices, at which supplies for night storage heaters can be taken, charge virtually only the running cost of the stations used at night: in other words, little more than the cost of fuel used to generate the consumer's electricity.
Off-peak tariffs for night storage heating were first introduced, as the noble Lord, Lord Ferrier, said, in the early 1960s, when the cheapness of fuel enabled the Boards to offer low rates, which encouraged the increasing use of electricity for space heating. These original tariffs normally had a period of charge at night, together with an afternoon boost, which was referred to by the noble Lord, Lord Burton. By the early 1970s, however, the introduction of new storage radiators that retained their heat better meant that the Boards could offer "White Meter" day/night tariffs that had a cheaper rate for the night-time hours only. This night rate was cheaper than the old restricted hour tariffs, because it approximated more closely to the deepest trough in demand when generating costs were at their lowest. Restricted hour tariffs were nevertheless retained for those who wished to remain on them, although they were no longer offered to new consumers.
The reason for the increase in off-peak rates that occurred between 1974 and 1069 1976 lay, as the noble Lord, Lord Ferrier, conceded, in the steep increase in fossil fuel prices that occurred in those years. Off-peak rates reflected little more than the cost of fuel, and since that was the most steeply rising of all the industry's costs, off-peak rates suffered proportionately more than unrestricted rates. I must emphasise, however, that the pricing policy of the industry has not changed. The night rate in England and Wales is still only 50 per cent. under the White Meter tariff. Because of it being a rather longer night rate in Scotland, as the noble Lord, Lord Ferrier, and the noble Lord, Lord Burton, know, it is 44 per cent.
Both the electricity supply industry and the Government were and are aware of the burden that increases in electricity tariffs placed on consumers, particularly the less well off and those in all-electric accommodation. I shall come presently, if I may, to Government actions in this area, which were raised by the noble Viscount, Lord Long. However, I wish first to mention the latest tariff developments.
Area Boards in England and Wales announced in the summer that a completely new household tariff, to be called the Economy 7 tariff, would be introduced this autumn. It is a day/night tariff, with a 7-hour night time supply available at a night rate of 1.06 pence per unit. This price is about 20 per cent. below the night rate in existing 8-hour White Meter tariffs and has been made possible by cost savings relating to the deep night period as the industry gains more experience in operating its large generating sets. It is about 37 per cent. of the day rate compared with the 50 per cent. that I have just quoted.
§ Lord BURTON
My Lords, may I draw the noble Lord's attention to one point. If storage is economical, then it ought to be possible to give the consumer more than 20 per cent. at the off-peak time.
§ Lord STRABOLGI
My Lords, I note the point which has been made by the noble Lord. In this short debate I do not think that it is possible to go into the various very technical reasons why this is not possible. What I am seeking to say at present is that it is 20 per cent. below the night rate in existing 8-hour White Meter tariffs.
1070 The noble Lord, Lord Ferrier, said, rightly, that this Economy 7 tariff does not operate in Scotland. The reason is that the Scottish Boards already operate the White Meter tariffs which provide for day rates which are cheaper than those in Area Boards in England and Wales and for night rates which are available for eight hours in the North of Scotland Board's area and 8½ hours in the South of Scotland. The coldest winter conditions in Scotland would make a 7-hour tariff less advantageous for the consumer than in England and Wales.
It is expected that most consumers who are already on White Meter tariffs with a six or eight hour night availability will be able to transfer satisfactorily to the new tariff and achieve savings of about 10 per cent. on average from doing so. But comments have appeared in the Press on the fact that simultaneous reductions are not being made for those on restricted hour tariffs. These consumers purchase electricity at a rate substantially below the standard domestic rate of between 11 and 15 hours, depending on the particular tariff. The hours of supply at this rate normally include an afternoon boost which, if they were on a White Meter or Economy 7 tariff, they would pay for at the much higher day rate in those tariffs. The restricted hour consumers are generally those whose equipment requires a long charging period at night and a boost in the afternoon. However, their tariffs have not increased as much in the last few years as the standard domestic tariff. The position, therefore, is that all off-peak consumers are benefiting from the savings gained in periods of low demand. Individual circumstances and preferences differ so widely in this area that the sensible course for consumers who are not sure whether they can benefit from Economy 7 is to seek advice from their local electricity board. The industry's advertising, which has brought Economy 7 to the notice of consumers, has also encouraged them to seek this advice.
With your Lordships' permission, I will now turn to measures which the Government have taken to alleviate the problem of high heating costs which was also mentioned by the noble Lord, Lord Ferrier, and the noble Viscount, Lord Long. I think that both noble Lords 1071 asked whether the Government are satisfied with what we are doing. The Government are never satisfied, but do try to treat and approach this matter, in the words of the noble Viscount, with which I fully agree, with due consideration for people's difficulties and full sympathy.
In a situation where it is no longer possible for the Government to subsidise everyone's fuel bill, what we have done is to concentrate as much money as possible specifically on helping those in greatest need. First, since we took Office, we have ensured that pensions and other social security benefits more than keep pace with increases in the cost of living. To take one example, the total increase in retirement pensions from October 1973 to date was 151 per cent. for a single person and 149 per cent. for a married couple. By comparison, the increase in the general index of retail prices from October 1973 to date was 108 per cent. In addition, the earnings limit for retirement pensions—that is, the amount pensioners can earn before their pension is reduced—has been increased from £40 to £45 a week, and there is no earnings limit for women over 65 or for men over 70 years old.
Secondly, additional help has also been given in the last two winters to those likely to have the greatest difficulty in meeting their fuel bills, through the electricity discount scheme. The scheme is to operate again, I am glad to say, in the coming winter. This time the scope of the scheme has been widened to include the recipients of rent and rate rebates and rent allowances. The noble Lord, Lord Ferrier, referred to the number of people taking this up, and asked whether it was being sufficiently advertised. I can tell the noble Lord that it has been widely advertised, by leaflets and posters, in post offices, public libraries, citizens' advise bureaux, electricity shops and show rooms and the national and local Press. I cannot give the exact figures of those who have taken it up but I think that it is a large number, because in 1977–78 the money set aside for this scheme was £25 million and the money spent upon it was about £23½ million. From this it will be evident that a great many people are taking it up.
1072 Thirdly, another practical measure of longer-term help is the advice published by the Joint Working Party set up by the Government early last year to consider all matters relating to the efficient use of energy for domestic heating. The Working Party has been looking into the problem of electrically heated dwellings and has published two notes on electric heating. I am sure that these will be of interest to the noble Lord, Lord Swinfen. I am very glad that he took part in the debate. One deals with selection criteria for electric space and water heating in new dwellings. The other includes broad guidelines for housing authorities with existing electrically heated buildings, and suggests practical remedies to enable households to achieve more acceptable running costs while ensuring adequate heating standards for the dwelling.
Fourthly, the Government are now implementing measures offering financial assistance towards the cost of insulation under which the elderly and those on low fixed income may benefit. Your Lordships will remember the Homes Insulation Act earlier this year. That provides for a scheme of grants to private householders in respect of specified basic insulation measures undertaken under the scheme. For the public sector, the Secretary of State for Energy announced in December last year that extra funding would be made to local authorities through the normal procedures. Local authorities are being asked to give priority initially to insulate dwellings occupied by elderly or disabled persons.
The noble Lord, Lord Burton, spoke about refrigeration and energy conversion. Experiments have been carried out on the development of "heat pumps". These work on principles like those of a refrigerator and claims have been made about their greater use in the future for space heating. The Electricity Council is aware of the long-term prospects in this field, and I think we had a useful discussion on this in the debate initiated earlier this year by my noble friend Lord Wynne-Jones.
The noble Lord, Lord Swinfen, asked me about the slowing down of output. New types of heater provide for variation in the rate of output. The London Electricity Board have experimented with varying input when the weather changes.
§ Lord FERRIER
My Lords, I would not dream of interrupting the noble Lord except that I am the bearer of red hot news in regard to the question put by my noble friend Lord Swinfen, to which the noble Lord is now replying. The South of Scotland Electricity Board is in the process of fitting in my house the latest possible gadget, which includes a thermostat on the outside of the house on the North wall so as to control the heat used on warm days. As a Scotsman I said, "Yes, do this. I should love to watch but I will not pay"!
§ Lord STRABOLGI
My Lords, I am very glad to hear that. It proves once again, if proof were needed, how enterprising are the Scots. I think we have had a valuable debate on this subject and I am grateful for the opportunity it has provided to explain the measures which the electricity supply industry and the Government have taken in response to the increases in electricity prices over the last few years. The lower off-peak price offered in the new Economy 7 tariff should be of real benefit to many consumers who rely on electricity for space heating, and other off-peak users who take an afternoon boost are already benefiting from the cost savings that have enabled the industry to introduce the new tariff.