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Energy Prices

Volume 605: debated on Thursday 11 February 2016

15. What steps her Department is taking to ensure that changes in gas prices are passed on to consumers. (903604)

16. What steps she is taking to ensure that reductions in the wholesale price of energy are passed on to consumers. (903606)

As the hon. Gentlemen may be aware, average domestic gas prices fell by £37 during 2015. Six major suppliers have announced a further cut in their tariffs; two more have announced that this morning. It is a good start, but the Government expect all suppliers to pass on reductions in the costs of supplying energy to consumers. I have met all the major energy suppliers in recent months to make that point clear.

Will the Secretary of State join me in celebrating the work of our local councils in assisting people to save energy? Oldham Council’s collective buying scheme has attracted 8,700 households to sign up to it, each of which will save about £170. In Nottingham, the first local authority energy company, which employs 30 staff, is hoping to sign up 10,000 households.

I will join the hon. Gentleman in congratulating his council on doing that. Some individual councils are doing exceptionally good work on group switching and are trying to help their constituents. I visited Nottingham last year to see the good work that has been done there. I hope that more councils will follow that lead.

Does the Secretary of State think that the Competition and Markets Authority should, as part of its investigation into the energy market, introduce measures to make switching suppliers easier, as the consumer group Which? has called for?

Like the hon. Gentleman, I am impatient to receive the comments of the Competition and Markets Authority. It was predominately to address the difficulties with switching and the difficulties that some consumers find in engaging with the energy market that the Prime Minister referred the energy market, via Ofgem, to the authority. I certainly hope that it comes forward with such suggestions.

Just over a year ago, the Government announced an investigation into whether families should pay less for their energy because of the fall in the wholesale price of gas. The Chancellor told The Telegraph:

“Falling oil and gas prices should bring cheaper household bills”.

A spokesman added that the Government were conducting a series of studies of utility companies to examine whether action was needed. The investigation was backed by the Prime Minister, the then Energy and Climate Change Secretary and the former Chief Secretary to the Treasury. It was reported that Ministers would be watching the energy companies “like a hawk”. What happened to that study, and what action was taken?

I can reassure the hon. Lady that we continue to watch the energy companies like a hawk. I am pleased that we continue to see reductions, with two more being announced just this morning, and I hope she will join me in welcoming them. The great news for consumers is that they are not faced with the price freeze that I cannot forget Labour promised last year. If that had happened, none of these reductions would have taken place.

Progress has been rather slow today, on account of some quite long questions and some long answers, but I do not like Back-Bench Members who are waiting patiently to lose out. The hon. Member for Ashton-under-Lyne will not lose out. I call Angela Rayner.