HL Deb 21 October 1998 vol 593 cc1438-40

2.59 p.m.

Lord Islwyn asked Her Majesty's Government:

Whether they have made any representations to the public utilities about granting financial concessions to old age pensioners.

The Parliamentary Under-Secretary of State, Department of Trade and Industry (Lord Sainsbury of Turville)

My Lords, no such representations have been made, but the Government are very conscious of the difficulties faced by many pensioners and have taken steps to tackle them. The Government have set up a group of senior Ministers to co-ordinate the Government's strategy for helping older people. We have reduced VAT on fuel from 8 per cent. to 5 per cent. We have introduced winter fuel payments. For the coming winter these will give at least £20 to every pensioner household and £50 to those in most need. We have allocated £500 million to enable winter fuel payments to continue for a further three years. We believe that pensioners should share in the prosperity of the nation and that this is the best way to tackle issues such as fuel poverty.

Lord Islwyn

My Lords, does the Minister recognise that standing charges are an increasing burden on less well off elderly people and that is why the National Pensioners Convention has persistently called for their abolition in respect of old-age pensioners? Can the Minister explain to the House what is the attitude of the Government on this issue?

Lord Sainsbury of Turville

My Lords, as to the question whether pensioners who use prepayment meters are charged too much, gas and electricity regulators have drawn up an action plan to drive down costs and improve efficiency and choice to disadvantaged consumers. That includes action to encourage more cost-effective meters and offer a wider choice of payment methods. The Government are also concerned that disadvantaged consumers should have a fair share of the benefits of liberalising the markets and are considering the case for further action through the regulatory system, if necessary, to ensure that the benefits are widely shared.

Lord Hardy of Wath

My Lords, is my noble friend aware that in the developing gas and electricity market very considerable advantage can be enjoyed by those who pay by direct debit but that there is very little advantage, if any, for those with prepayment meters rather than bank accounts?

Lord Sainsbury of Turville

My Lords, I take my noble friend's point. Some people have had the benefit of payment by direct debit and in other cases those with prepayment meters have been disadvantaged. But the action that I have explained is related directly to the resolution of that problem and action has already been taken to that end.

Lord Peston

My Lords, can my noble friend tell the House why some insist on referring to these bodies as public utilities? Are they not largely in the private sector and is not their only interest first, middle and bottom line making profits? Why would anyone remotely believe that they would have any interest in the plight of poor people in our society?

Lord Sainsbury of Turville

My Lords, all of them are controlled by regulators who place upon them certain duties. Noble Lords will also be aware that the Government are imposing a new duty on regulators to consider the needs of low income customers.

Lord Higgins

My Lords, despite the current fashion for means-testing and the taxing of benefits, does the noble Lord agree that it would not be appropriate for such concessions as were mentioned in the original Question either to be means tested or taxed?

Lord Sainsbury of Turville

My Lords, in this case we are not talking about concessions. In these circumstances no concessions have been asked for. We believe that the way to tackle these problems is by means of the measures that I enumerated not by concessions, for the reason that there is strict regulation of the utilities not to show undue preference to particular groups in setting charges. Any proposals for financial concessions for particular groups are matters for the regulators subject to their duties and the non-discrimination requirements of the legislation. The reason for taking that line is very clear. Any substantial concessions to pensioners, not all of whom are poor, would have to be paid for by an increase to other consumers some of whom are on low incomes.

Earl Russell

My Lords, is the Minister aware that the number of deaths through hypothermia in this country is higher than in Sweden? Does he agree that that cannot be climatically explained? Can he tell the House what plans the Government have to reduce this figure?

Lord Sainsbury of Turville

My Lords, I cannot comment on the comparison between the two countries. Noble Lords will understand that the Government have introduced a whole series of measures aimed at enabling pensioners to pay bills and there are very strict regulations that govern the disconnection of meters and the turning off of heating arrangements.

Lord Jenkins of Putney

My Lords, can my noble friend tell the House whether pensioners in London and elsewhere would be well advised to accept the offer of British Gas to become the sole provider of energy to their homesteads?

Lord Sainsbury of Turville

My Lords, I do not believe that it is for the Government to comment on the matter. People must make their own decisions based on the best advice that they can get.

Baroness Carnegy of Lour

My Lords, is the Minister aware that not very long ago I received a letter telling me that the Government had decided to give me £20 to help with my winter fuel bills and that that was more than any government had ever made available to pensioners? Does the noble Lord agree that it would have been less misleading to the many millions who doubtless received that letter had it been explained that the kind donor was the taxpayer and not the Government?

Lord Sainsbury of Turville

My Lords, the noble Baroness is perhaps misjudging the intelligence of most pensioners. I am sure that they are perfectly capable of understanding that point.

Lord Islwyn

My Lords, I am rather disappointed by the reply of the Minister. He has utterly failed to answer the Question. Cannot the Government discuss with the respective regulators what action can be taken to remove these charges, for such a result will certainly be beneficial to the health and well-being of our elderly people?

Lord Sainsbury of Turville

My Lords, I believe that I have already covered that point. On the basis of our regulatory system there must be a charging system for these payments. Moves have been made to make certain that the payments are as fair as possible. In the light of that action, I believe that the point has been covered.