I beg to move,

That leave be given to bring in a Bill to amend the law relating to the regulation of domestic energy providers; to require an energy company to publish on invoices information indicating whether the customer is on the cheapest tariff offered by that company, based on pattern of energy use, and the savings to be gained from any switch to this tariff; and for connected purposes.

The idea behind the Bill is relatively simple—too many consumers are paying too much for their energy consumption. Energy companies could do more to provide information to highlight where customers could find cheaper tariffs.

I am grateful for the cross-party support for the Bill, as can be seen from the names of sponsors from both sides of the Chamber. It is supported by those who signed early-day motion 749, from which the Bill is drawn. I welcome Conservative Front Benchers’ support for the Bill. When I raised the matter with the Secretary of State for Energy and Climate Change in the House, he described the idea as “ingenious”. I welcome the third-party support outside this place from groups such as Consumer Focus, Which?, the Energy Action Group, Help the Aged and Age Concern, which have all lent their support to the debate.

The Bill’s aim, I hope, is to help consumers realise that perhaps they need to do more to achieve cheaper tariffs. It is designed to help all consumers, but particularly those in fuel poverty. We know the definition of fuel poverty: 10 per cent. of a household’s income being spent on keeping their living areas warm. It is much easier, however, to quantify the issue itself, because Government figures are at least two years out of date and the independent group Consumer Focus estimates that about 5 million households are in fuel poverty. If we needed evidence of that, we might look only at the winter of 2007-08, when something like 22,000 people over the age of 65 died of a cold-related illness—far more than in many European countries with colder climates.

Constituents often write to me—I am sure I am not the only Member who receives such correspondence—and graphically describe how they have to deal with the effects of high energy and food prices. Indeed, they often have to choose between the two. One constituent said that he could afford only one hot meal a week and lived off biscuits and bread, because he could not afford the high energy prices he was charged.

We know that too few consumers switch between suppliers. Ofgem is looking at the issue and has suggested that an annual prompt, reminding consumers how they can switch from one supplier to another, would be a good idea. Often, however, the problem is that consumers do not know whether they are on the cheapest tariff with the energy company that already supplies them. That is the point of the Bill; it is designed to make all that information much clearer. By way of early-day motion 749 and the Bill, I have suggested that energy companies be obliged to provide information—assuming the customer is on a direct debit and has online access—about whether their consumers are on the company’s cheapest available tariff, given their pattern of energy use. There should also be clearer information on energy company bills about whether savings could be accrued if the consumer were to switch to the cheaper tariff.

That is the bare minimum of information, and much more could be included in the energy bill. Certainly, more tariffs, including social tariffs, could be put on bills to ensure that all consumers saw whether they were on the cheapest tariff. The proposal has various advantages: consumers would be able to see how much they might save if they switched; it would act as a reminder and allow people to see whether consumers take advantage of the latest discounts; and it might encourage some consumers to pay by direct debit or set up online access, which could help with their bills, and might even help the energy company itself.

The fact that bills are too complicated is beyond doubt. Which? estimates that, on average, there are 15 tariffs per energy company. If we take into account all the variants, including payment methods, special offers, discounts and so forth, we see that there are about 4,000 different tariffs, and the evidence clearly suggests that that is all very confusing. I have recently seen evidence to suggest that a quarter of all those who switch, and up to half of all those who switch as a result of direct selling on the doorstep, switch to a worse tariff. That is clear evidence that there is a lot of confusion out there. Until recently, a customer on a social tariff had no guarantee that they were on the cheapest tariff. Thankfully, Ofgem has taken some action to try to put that right, but it clearly illustrates that there is widespread confusion with regard to this plethora of different tariffs. That is wrong. We need simple measures, with energy companies putting on bills information about the cheapest tariff, given certain preconditions. Payment by direct debit and online access are two of the preconditions. However, that is a bare minimum—it does not prevent energy companies from adding other tariffs, including social tariffs, to try to ensure that they meet their social responsibility to help the customer to achieve the cheapest tariff possible.

The direction of travel is in our favour. Ofgem is considering the issue. It has suggested, for example, that energy companies might be required each year to display on their bills the customer’s usage against an average group of tariffs and declare whether the customer has paid a premium. That is a step in the right direction, and it is to be welcomed. However, an annual statement is not good enough. This prompt—this comparison with cheapest tariffs—should be issued when consumers get their bills through the door, because that is when they are most aware of their tariff.

We all accept that energy companies need to make a profit—there is big investment to be made in the infrastructure and so forth—but at the same time they owe a social responsibility to their customers, and that needs to be met. The industry has made some helpful moves. Energy companies have introduced social tariffs and funded the Home Heat helpline, and the Energy Retail Association and Citizens Advice have been helping customers, but they could take this one further, very simple step to help customers to achieve the cheapest tariff. That would create a lot of good will for them and do a lot to help consumers with their bills at this time of very high energy and food prices. Ofgem is heading in the right direction, and the industry is trying to make moves to help consumers, but we need a clear message from Parliament on this issue. I therefore commend the Bill to the House.

Question put and agreed to.

Ordered,

That Mr. John Baron, Mr. Lee Scott, Mr. Frank Field, Mr. Peter Kilfoyle, Nick Harvey, Mr. Peter Ainsworth, Mike Penning, Dr. Kim Howells, Mr. Peter Bone, Dr. Ian Gibson, Mr. David Laws and Dr. Richard Taylor present the Bill.

Mr. John Baron accordingly presented the Bill.

Bill read the First time; to be read a Second time on Friday 16 October and to be printed (Bill 87).