Government must act now on energy prices
WHILE the Trussell Trust reported this month that numbers using food banks have tripled this year alone, a rise reflected in Bristol, they also drew attention to the growing number of people handing back food requiring cooking because they cannot afford to heat it. Are we not ashamed by this?
We must address the gap between rising prices and falling incomes. Nowhere is this gap clearer than within the energy sector.
This week, Age UK revealed that 200 pensioners could die each day this winter because they cannot afford to heat their homes. Elsewhere, people are eating cold soup from tins, washing in cold water and encouraging their children to put on layer after layer to keep warm. These are our neighbours, friends, relatives, colleagues and people I meet at my surgeries – people who deserve a chance to enjoy a decent quality of life.
Four of the big-six energy companies have announced large price rises, despite their profits more than doubling over the last year alone. These companies claim to be making a modest profit of 5 per cent – but this ample figure is their retail profits. They make much higher profits generating energy – up to and over 20 per cent – which they sell to themselves.
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Last week, British Gas tried to reassure consumers that a 9 per cent price hike does not necessary lead to higher bills because people can choose to use less gas and electricity. This offers no hope to the four million people who have been pushed into arrears by price rises and are already struggling to heat their homes.
The Prime Minister has suggested removing green levies to reduce bills, his pledge to lead the "greenest Government ever" a distant memory.
This approach does nothing to fix the broken energy market. We need green levies. The Government reported that without them prices are likely to rise by 18 per cent by 2020, rather than 5 per cent with them.
We must improve energy efficiency among the 10 per cent of dwellings that fail the decent-homes test, to bring down bills and ease pressure on the NHS which spends £1.36 billion each year to treat health problems caused by cold homes.
Some 52 per cent of green levies goes towards initiatives designed to keep people warm – and 29 per cent goes towards renewables which will prevent massive future price rises. Levies are important but they cannot be a blank cheque. They need to provide effective, targeted and value-for-money support.
The alternative is a two-year price freeze which will save average households £120 and businesses £1,800 each year. This is what Ed Miliband and a Labour Government will do if elected in 2015, something we will continue to press for now.
We need greater competition and transparency in the market, overseen by a tough, new, fit-for-purpose regulator which can make companies put consumers on the lowest tariff and pass down wholesale price falls.
I hope this Government makes the brave choice and tackles vested interests to stand up for millions of households and businesses who need action on this now.