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Gas Act 1986

Volume 177: debated on Monday 23 July 1990

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To ask the Secretary of State for Energy what proposals he has to amend the Gas Act 1986.

I have raised before in the House the dilemma confronting Coventry city council, as a consequence of the Gas Act 1986, in relation to the cheaper price of contract rather than tariff supplies. The council has decided to heat 17 schools and old people's homes from now until 30 November with all their windows open, so that 56,000 extra therms will be consumed and the council will qualify for the cheaper contract gas, thus saving the city £30,000. The problem is not unique to Coventry among local authorities. The Minister and his Department responded to paragraph 4 of the Energy Select Committee's report, saying that they are confident that British Gas and the Office of Gas Supply will continue to discuss that aspect until a satisfactory solution is found. To whom is such a solution to be acceptable, and how long will those discussions continue?

The hon. Gentleman perfectly reasonably cites a problem which I accept exists. However, it is fair to say that in Coventry, as in any other part of the country where there is aggregation, there is no need for the city council to burn gas in the way that the hon. Gentleman describes.

That may be so, but in practice, because of aggregation, the total sum that the council will have to pay is no more than it would have paid a year ago. Nevertheless, efforts are being made by Ofgas, British Gas and myself to work out a solution to this complicated problem. It is not a question of the legislation but of how one tapers through its provisions. Genuine efforts are being made to resolve the problem.

Does my right hon. Friend accept that that scandalous waste of gas has been going on too long? It is not only schools and the public sector that are deliberately wasting gas to pay less for it by qualifying for an industrial tariff, but commercial interests such as hotel groups and retail outlets. It pays users having a consumption of about 18,000 therms to burn up to 25,000 therms because they will then pay less for that gas. Is not it time either to allow aggregation below 25,000 therms or to amend the Gas Act 1986 so that that ridiculous anomaly can be removed?

I do not quite agree with my hon. Friend's figures, but it is perfectly fair to say that my hon. Friend, like the hon. Member for Coventry, South-East (Mr. Nellist) points to a problem. Work is going on to see how that problem can be solved.

The privatisation of the utilities has certainly resulted in competition at the industrial and commercial ends of the market. But, as last week's increase in British Telecom's charges shows, there is severe discrimination against domestic consumers. What will the Government do to protect domestic gas consumers?

The hon. Gentleman cannot have been listening to one of my earlier replies when I said that since privatisation the domestic gas consumer is paying 14 per cent. less in real terms for gas.