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Electricity Supplies (Free Allowances)

Volume 887: debated on Monday 24 February 1975

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asked the Secretary of State for Energy what studies his Department has made of the practicality and cost of introducing a free allowance of electricity for retirement pensioners, the chronically sick and disabled and those in regular receipt of supplementary benefit or family income supplement.

I estimate that at current electricity prices, including current fuel costs, a scheme for free allowances on the lines indicated in my hon. Friend's previous Questions, on 31st January, would cost about £150 million for pensioner households; £22 million for chronically sick or disabled persons; and £22 million for persons receiving supplementary allowances and family income supplement. The cost could be expected to rise substantially as electricity prices increase. The operation of such a scheme would cause considerable practical difficulties, and those in need are already helped through the social security system.

Will my hon. Friend accept my congratulations that his Department has now been able to make these calculations, and my sorrow that it was not able to do so earlier? Is he aware of the impact that price increases will have on the poor and on the other groups that I have mentioned—massive increases already and a further 40 per cent. to come? Does he know how important fuel is in the budget of the poor? Does he know the extent to which the high price of fuel contributes to deaths and illnesses, particularly among old-age pensioners?

If my hon. Friend cannot introduce a simple humane free allowance scheme, such as that which operates in the Republic of Ireland, will he at least consider two-tier pricing, so that these groups in the community may consume a limited amount of electricity at a reasonable rate before having to pay high prices?

I am sure that on reflection my hon. Friend will agree that the Department of Energy has always tried to be as helpful as possible in providing him with information on this subject. I hope that he will accept that in the Department as it is run by my right hon. Friend there is no lack of compassion or concern for pensioners, and so on.

I am glad that my hon. Friend accepts that.

My hon. Friend has submitted his proposals to the Department and we have tried to cost them out. We are con- sidering what we can do to help to alleviate the burden. My hon. Friend must agree that my right hon. Friend the Secretary of State for Social Services has tried to assist by increased heating allowances, and some of my hon. Friend's suggestions are matters for her rather than for my right hon. Friend.

When the Department was making these calculations, did it take the actual consumption of a sample of pensioner families, or what they ought to have consumed—if that is possible?

We took an estimate covering 5·2 million pensioner households, comprising 7·5 million of the total of 8 million pensioners. If 7·5 million pensoners—that excludes those in institutions—each received such an allowance, the cost would be an additional £67 million. I hope that that is the information that the hon. Lady is seeking.