Hansard

I beg to move amendment 17, in clause 1, page 1, line 16, at end insert—

“(e) where the person has experienced child criminal exploitation;”.

This amendment would include victims of child criminal exploitation in the definition of a victim.

With this it will be convenient to discuss the following:

Amendment 51, in clause 1, page 1, line 16, at end insert—

“(e) where the person has experienced adult sexual exploitation.”

Amendment 18, in clause 1, page 2, line 6, at end insert—

“(c) ‘child criminal exploitation’ means conduct by which a person manipulates, deceives, coerces or controls a person under 18 to undertake activity which constitutes a criminal offence;”.

This amendment provides a definition for the term “child criminal exploitation”.

Amendment 52, in clause 1, page 2, line 6, at end insert—

“(c) ‘adult sexual exploitation’ means conduct by which a person manipulates, deceives, coerces or controls another person to undertake sexual activity.”

This amendment would provide for a statutory definition of adult sexual exploitation.

The Minister should not be surprised that we are debating child criminal exploitation once more; my hon. Friend the Member for Rotherham tabled a similar amendment to the Police, Crime, Sentencing and Courts Act 2022 just two years ago. Unfortunately, but unsurprisingly, the Government voted against that amendment, so two years on we still do not have a definition of child criminal exploitation in statute. Barnardo’s and the Children’s Society define child criminal exploitation as when

“another person or persons manipulate, deceive, coerce or control the person to undertake activity which constitutes a criminal offence where the person is under the age of 18.”

That is the definition that we would like to see on statute.

Child criminal exploitation takes a variety of forms, but ultimately it is the grooming and exploitation of children into criminal activity. The current reality is that, across each form that child criminal exploitation takes, children who are coerced into criminal activity are often treated as perpetrators by statutory agencies, rather than as victims of exploitation. That is partly because safeguarding partners work to different understandings of what constitutes criminal exploitation.

Recently, child criminal exploitation has become strongly associated with one specific model—county lines—but it can also include children being forced to work in cannabis factories, being coerced into moving drugs and money across the country, or being forced to commit financial fraud, to shoplift or to pickpocket. The lack of shared understanding of what child criminal exploitation is and the guises it can take means that the questions are not consistently asked when children are identified as being associated with criminal activity, either at the time of arrest or during court cases in which the possible coercion of a child has taken place.

Throughout the country, children are being used by criminal gangs to do their bidding, and they are often subjected to the most sophisticated coercion, intimidation, duress, abuse and, sometimes, sexual abuse, so does my hon. Friend agree that it is indefensible not to have them listed as victims in the Bill?

I absolutely agree with my hon. Friend. It is completely indefensible not to have the definition of child criminal exploitation in the Bill to make sure that, as she says, such children are seen as victims, not perpetrators.

The lack of shared understanding that I mentioned also means that children are often arrested for crimes that they are forced to commit, whereas the adults who exploit them are often not investigated or brought to justice, leaving them free to exploit other children, which happens. All this is because of the absence of a statutory definition of child criminal exploitation, the true scale of which is completely unknown. We know that it is happening all over the place—it is off the scale, essentially—but many children who are exploited or groomed fall through the cracks of statutory support so are not identified in official statistics.

In England in 2021-22, there were more than 16,000 instances of local authorities identifying child sexual exploitation as a factor at the end of an assessment by social workers; 11,600 instances of gangs being a factor; and 10,140 instances of child criminal exploitation being a factor. It has been estimated that in England alone there could be as many as 200,000 children aged 11 to 17 who are vulnerable to serious violence because of the levels of crime or income deprivation in their community.

Research carried out by Dame Rachel de Souza, the Children’s Commissioner for England, found that 27,000 children who were at high risk of gang exploitation had not been identified by services and as a result were missing out on vital support to keep them safe. The research also found an even higher number of children who were experiencing broader risk factors linked to exploitation, with one in 15 teenagers—or 120,00 young people—falling through the gaps in education and social care. These are children who are being excluded from school, who are persistently absent or who go missing from care, and many face a combination of factors that leave them vulnerable to exploitation.

In the evidence sessions last week, Dame Rachel de Souza spoke about the importance of including a statutory definition of child criminal exploitation in the Bill. When asked whether it should be in the Bill, she said “absolutely”, and that she had wanted to bring it up herself. She said:

“When I go around the country and talk to children, wherever they are—whether that is being held in police cells or children who are involved in drugs or whatever—I realise just how complex the situations are. You realise that these children are as much victim as perpetrator. Children tell me all the time that their experiences with the police make them feel like they are not victims but criminals. That is what we need to sort out.”––[Official Report, Victims and Prisoners Public Bill Committee, 20 June 2023; c. 24, Q50.]

10.45am

Organisations such as the NSPCC, the Children’s Society and Barnardo’s have done a brilliant job in campaigning for statutory services to recognise that those children have not made a choice to get involved in criminal activity, as perpetrators of exploitation want them to believe. They have been groomed and coerced in the same way as children groomed for sexual exploitation, and they should be treated as victims.

Practitioners at the Children’s Society found that the typical age of children being criminally exploited is 14 to 17, although there are victims as young as seven. That form of exploitation occurs most frequently among boys, but there is increasing evidence that girls are also being groomed to commit criminal offences. That is also being unreported by statutory agencies and services. One practitioner disturbingly reported that some of the girls they work with see criminal exploitation as their only way out of being sexually exploited. Is this really the country we want to live in? Do we not want to deal with that in this Bill? It is hard to imagine what those young girls face in their day-to-day lives.

I visited the St Giles Trust—I saw its centre in Cardiff, but it does a fantastic job across the country. It does great work in supporting vulnerable children who have been exploited and abused and are caught up in crime. For many of those children, not being exploited is not an option. Perpetrators exploiting children criminally—for example, through the county lines model of criminal exploitation—can be prosecuted under the Modern Slavery Act 2015 for slavery, servitude, and forced and compulsory labour offences and trafficking for the purposes of exploitation.

Although many perpetrators exploiting children for criminal purposes will be arrested and charged for stand-alone offences, such as supplying a class A substance, they are not held accountable for the harm and damage they have caused those children’s lives. It is abundantly clear that there is a disparity between the number of children being criminally exploited and the number of perpetrators of criminal exploitation being charged under the Modern Slavery Act.

I think that, last year, four people were charged with child trafficking, and one person was convicted. I believe that last year also saw the highest rate of young boys being trafficked into the system and being recorded in the national referral mechanism. Although the number of victims has gone up over the past 10 years, the number of trafficking convictions has gone down.

I thank my hon. Friend for absolutely illustrating the point.

I want to raise a real case of child exploitation. A 15-year-old boy, whom I will call Robbie—not his real name—was picked up with class A drugs in a trap house raid by the police. He was driven back home by police officers, who questioned him alone in the car and used that information to submit an entry to the national referral mechanism, which did not highlight his vulnerability but instead read like a crime report. Robbie subsequently went to court. His national referral mechanism failed, and his barrister, who did not understand the NRM process, advised him to plead guilty, which he did.

My hon. Friend is making an excellent speech and speaking up for the rights of children. I am sure we all have cases where we know a child has been exploited and is vulnerable—by definition, a child is a vulnerable person. If a child is criminally exploited, it means that their vulnerability is increased. Does my hon. Friend agree that it makes no sense for them not to be included in the victims code?

That is an excellent point. My hon. Friend has absolutely reinforced the point that such children must be included in the Bill as victims.

I move on to talk about Robbie’s experience—as I said, that is not his real name. In June 2019, he was referred to the Children’s Society’s disrupting exploitation programme. The programme helped Robbie challenge the national referral mechanism decision, and those supporting him attended court sessions with him to ensure that his vulnerability was outlined and that he was recognised as a victim, instead of an offender. That enabled him to retract his guilty plea and access vital support. However, that was just one case. He was lucky: he had the Children’s Society programme there to support him. We know that does not happen for the majority of child victims.

Is my hon. Friend aware that had Robbie arrived on a small boat and been trafficked out of a hotel and into a cannabis factory at the age of 10—Channel 4 has found such a case—he would not be entitled to any support from the NRM under the proposals of the Illegal Migration Bill, even though he would be a 10-year-old child who had been groomed into drug dealing?

Absolutely. That illustrates yet more child criminal exploitation. The whole thing is just horrific and absurd, which is why this issue needs to be addressed.

Back to Robbie. As the drugs that he had been selling were confiscated by the police when he was picked up in the raid, there was debt bondage in Robbie’s case, as he now owed the groomer money for the drugs that had been lost. In turn, that resulted in threats to him and his family. The programme then worked with the police to complete intelligence forms and make sure that Robbie’s safety was paramount. It put markers on the home and made sure that the police were aware of the situation, so that they could respond quickly if anything happened. The programme supported Robbie to continue his education.

Amendments 17 and 18 are absolutely vital to make sure that we take the necessary steps to protect vulnerable children and to focus agencies’ attention on the adults who exploit them and are linked to the much, much more serious crimes that are taking place. Protecting children and bringing true criminals to justice—I do not see how anyone, least of all the Government, can object to such a notion. I will push the amendments to a vote later, but I hope the Minister will seek to include them in the Bill.

I start by apologising to the Committee. For each month that the Bill was delayed, I tabled another amendment, so I have quite a few today.

I will speak to amendments 51 and 52, which stand in my name, and then to those tabled by my hon. Friend the Member for Cardiff North. My amendments seek to provide a definition of adult sexual exploitation and are informed by my experiences of child sexual exploitation. I hope to make the argument that one very often blurs into the other, and the same arguments stand for both.

In 2009, the Department for Children, Schools and Families introduced a statutory definition of child sexual exploitation for the first time. I can honestly say that it has been transformational in ensuring that child abuse and exploitation are understood and that children receive the necessary support. We now need to accept in this Committee that adults can also be sexually exploited.

The STAGE group is supported by the National Lottery community fund and my hon. Friend the Member for Birmingham, Yardley. It is a fantastic group that highlights the nature and extent of the sexual exploitation of adult women across our communities and seeks to change legislation to give them better support. STAGE brings together a number of charities to provide trauma-informed support for women who have been groomed for sexual exploitation across the north-east and Yorkshire—including, in my constituency, the amazing organisation GROW, which I say to the Minister is severely underfunded at the moment.

Adult sexual exploitation is a specific form of sexual abuse. It occurs where an individual or group takes advantage of an imbalance of power to coerce, manipulate or deceive a person aged 18 or over into sexual activity, usually in exchange for something that the victim needs or wants—often drugs, alcohol or indeed love. It is also usually for the financial advantage or increased status of the perpetrator or facilitator. The victim may have been sexually exploited even if the sexual activity appears to be consensual. It can happen online as well, of course. The victims cannot give informed consent if they see no reasonable alternative to engaging in the activity, or if they have a reasonable belief that non-engagement would result in negative consequences for themselves or others.

Adult sexual exploitation does not always involve physical contact; it can also occur through the use of technology. My amendment 52 reflects the wording used in the statutory definition of child sexual exploitation, which the Government already use. The Government need to accept that not just children are exploited: many women—it is usually women—are exploited as adults, too. They are victims and deserve support, and that begins with ensuring that their abuse is recognised through a statutory definition of this form of sexual abuse.

One case study from the STAGE group is N, whom I will keep anonymous. N is a 22-year-old first-generation British Pakistani woman, who grew up in Leeds in a devout Muslim household. From a young age, N began experiencing sexual abuse from a male in her extended family. N began to spend more and more time outside of the family home; she could not talk to her family about the abuse because she did not want to be seen to bring shame into the household. During her time spent out of the house, N was introduced to a “friend”, whom I will call H.

H began to groom N, supplying her with drugs and alcohol to the point where she developed a dependency. He used her fear about shame as a form of control—to ensure that she did not speak out about the abuse he would subject her to. N was 15 at the time. Between the ages of 15 and 18, N was seen as a victim of child sexual exploitation. She was trafficked around Yorkshire by H, being picked up in taxis and taken to properties to be raped repeatedly. Professionals did all they could to safeguard N, but the abuse continued. N experienced a breakdown in her mental health due to the repeated trauma that she was experiencing, and she began drinking heavily on a daily basis.

When she was 18, the exploitation continued on a weekly, sometimes daily, basis. However, since she moved into adult services, the police and adult social care brought into question whether N was making “unwise choices” in respect of whether she was getting something out of these exchanges. So N was seen as a victim of child exploitation while she was 17—364 days—but the following day, when she turned 18, this victim of adult sexual exploitation was making “unwise choices”.

A lot of work from STAGE partner Basis Yorkshire was put in place, including advocating for N—although she was not a child any more, by law she was experiencing sexual exploitation. Over the past few years STAGE has lobbied health, police and social care services to ensure that N is recognised as a victim of grooming and exploitation. Although she might seem to “choose” to get into a taxi or to meet H or one of his associates, that is in fact a result of the coercion and control that takes place in grooming and exploitation. In legislation we recognise coercive control.

11.00am

In March this year, N had an episode in which she went missing. When she was located following a sexual assault, the responding police officer informed STAGE that it could not be sexual exploitation because N was over 18. The lack of a legal definition of adult sexual exploitation has allowed N’s abuse to continue and has led to a lack of professional curiosity among key safeguarding services. I say to the Minister—I know he is aware of this—that N’s case is replicated across the country. Many women in other situations do not themselves recognise that they have experienced sexual exploitation, in part due to the fact that there is no statutory definition of adult sexual exploitation.

I should declare that I am chair of the STAGE group. Is my hon. Friend concerned, as I am, at the disparity when it comes to women who are British citizens? When sexual exploitation is considered as part of human trafficking, a foreign national is far, far more likely to be considered a victim than a British person. In many regards, British victims of sexual exploitation—adults and children—get lesser services.

Sadly, I am concerned and I absolutely agree. That is partly why we need a definition. The national referral mechanism was mentioned. By moving a person from one side of the street to the other they are trafficked, so they could fall under the national referral mechanism for modern slavery or just be prosecuted. But without a definition, services are not taking a joined-up approach and using the resources already in place.

The same arguments about choice and risky lifestyles in relation to adult victims of sexual exploitation were used in Rotherham. Having a definition would mean police forces being trained in what the definition means. Legal arguments would be put forward, and judges would receive training so that when they saw a young person in front of them they would understand that their behaviour was a symptom of being sexually exploited. There is a domino effect once a legal definition is in place. That is what happened with child sexual exploitation, so I hope that that will happen with adult sexual exploitation. I will come on to child criminal exploitation, but I have said to the Minister what needs to happen with adult sexual exploitation.

Manipulation by perpetrators, cultural expectations and family and community dynamics make it difficult for women to identify that they have experienced abuse. But sadly, sexual exploitation, as I have said, is not widely understood by professionals. It is vital that the Ministry of Justice use the Bill as an ideal opportunity to create a statutory definition of adult sexual exploitation to ensure a consistent understanding and recognition of the ways that sexual exploitation continues and presents itself in adulthood.

Amendments 51 and 52 would be a huge step in the right direction by recognising people who have experienced adult sexual exploitation as victims and entitling them to the crucial support available under the Bill. That must also come, of course, with support and funding for training to be given to police and justice staff to identify the signs of sexual exploitation.

I will now speak in support of amendments 17 and 18, which are about the definition of child criminal exploitation. The amendments would place a statutory definition of criminal child exploitation in law for the first time by ensuring that children who are being exploited are classed as victims under the Bill. Child criminal exploitation is the grooming and exploitation of children into criminal activity. There is a strong association with county lines, but it can also involve moving drugs, financial fraud and shoplifting on demand. That our laws catch up with our reality and realise the harm and damage that those criminals are causing children is long overdue. The true scale remains unknown, as many children fall through the cracks, but we have some evidence that indicates the scale of the abuse.

The former Children’s Commissioner estimated that 27,000 children are at high risk of gang exploitation. During 2020, 2,544 children were referred to the national referral mechanism due to concerns about child criminal exploitation, and 205 of those cases involved concerns about both criminal and sexual exploitation. The pandemic has only made the situation worse. Children in Need reported that during the pandemic children faced an increased risk of online grooming or exploitation due to time online, not being at school or college, and increased exposure to harmful online content such as inappropriately sexualised or hyper-violent content.

In the evidence sessions last week, the current Children’s Commissioner fully supported introducing a statutory definition of child criminal exploitation. She explained that the situations facing the children affected are very complex and that police make many feel like criminals rather than victims, as my Front-Bench colleague, my hon. Friend the Member for Cardiff North, highlighted.

It is clear that thousands of children are being criminally exploited every day and the response for those children must be immediate and properly resourced. Experts believe that a lack of understanding of child criminal exploitation prohibits an effective and joined-up response. The lack of a single definition means that local agencies respond differently to this form of exploitation across the country. The Children’s Society data shows that a third of local authorities had a policy in place to respond. That means that two thirds do not. Given the nature of this exploitation, a national shared understanding is imperative. That is what a definition would provide.

Let me for one moment contrast the situation with that of the response to child sexual exploitation, which I spoke to on a previous group of amendments. Police officers across the country say to me that, because the police and politicians understand CSE, the police get resources specifically to address CSE. That is great and I support that provision, but it takes away from the resources we need for CCE. They are treated as two separate issues, even though the same gangs often promote both forms of exploitation. They are using these children for criminal exploitation, whether that be sexual, drug running or shoplifting. Accepting the definition would mean that we see criminal exploitation of children and sexual exploitation of children just as “exploitation of children” and we can pool the resources and expertise to try to prevent this crime.

Many children who are criminally exploited receive punitive criminal justice responses, rather than being seen as victims. Again, I take colleagues back; that is what happened 25 or 15 years ago with child sexual exploitation victims.

The hon. Lady is making some incredibly powerful points and I have sympathy with a lot of them, but on several occasions, she has mentioned circumstances that would constitute criminal conduct. For example, she talked about victim N, who was raped. Rape is clearly criminal conduct. Does she accept that children in that situation would be covered by the provisions in the Bill?

Secondly, she is making a point about how young offenders are dealt with. I am a former youth magistrate and member of the Youth Justice Board. Does she accept that the judiciary dealing with young people are now trained and encouraged to find out whether the defendants in front of them have been subject to this kind of exploitation, and that that is therefore considered in the way that they are dealt with?

I will deal with those points in reverse order. My first reaction is to question why they were in front of a magistrate in the first place. How have those children gone all the way through the system to be in front of a magistrate, rather than it having been recognised at a very early point that there is something going on with the child? Why is a 15-year-old repeatedly running drugs across county lines? What is happening? What is behind that? The professional curiosity is not there.

That leads me to the hon. Gentleman’s opening point. Of course, raping a child or raping an adult is a crime. We all recognise that. First, there are very low levels of reporting, and—as I hope I made clear with the adult sexual exploitation argument—a lot of people do not recognise it. They just think, “I’m a drug addict. He’s my dealer. I have to do this in order to get my drugs.”

First there is the reporting situation, and secondly there is recognition. In the case of N, she was seen as putting herself in a risky situation, so she would not be seen as a credible witness. We are not seeing the overall picture and the patterns of behaviour—the fact that the same children might be in the same location day after day—and then going back upstream to see what the motivator is and who is controlling the situation. I hope that having the definition of both terms will enable the police forces, the judicial services and the support services to see the broader picture and place the victim in that broader context. That is where I am coming from with both amendments.

The hon. Lady posed a direct question to me. In terms of those young people coming before the youth courts, will she acknowledge that there is now a far greater use of diversion at the very early stage by the police and youth offending services, which means in fact that far fewer young people are coming to court? I was directly addressing the situation she raised about what happens when they are in front of that judicial process. In fact, there has been a huge amount of progress in trying not to bring children in front of magistrates or judges if it can possibly be avoided. Does the hon. Lady accept that there will be occasions when the level of offending is so great that society rightly demands that those people must face justice, at which point judges and magistrates can consider all the factors in determining what action to take?

I fully accept the hon. Gentleman’s points. There was no criticism implied, but I will give one example. In 2013 I worked with Barnardo’s, and we did an inquiry to see whether the justice system was fit for purpose for child sexual exploitation cases. Something that we found, which I alluded to, was that when a victim was in front of a judge as a witness, they were often seen as chaotic, aggressive and unreliable. We identified that if the judges had training on what a victim of child sexual exploitation presented like or as, it would make a difference. Indeed, it has made a dramatic difference now that that training has been rolled out.

If we got the definition of child criminal exploitation, a judge would automatically get training on the identifiers, so one would hope that the outcome would be more informed on the basis of having understanding of the young person in front of them, rather than just looking at the crimes. That is not to say that there will not be young people who are bad ’uns, who will use this and exploit what they see as a “get out of jail free” pass—I fully accept that could happen—but if the judge has a proper understanding of criminal exploitation, one would hope that they would then be able to challenge that a little more from an informed position and make the right decision for the young individual in front of them.

I have now covered quite a lot of my points—happy days! Another thing that really frustrates me is that many children who experience child criminal exploitation come to the attention of services once they are arrested for crimes. Again, if we had the definition in place and the awareness in the services, one would hope that the child presenting would be seen as a warning sign, rather than as a criminal. Individuals who exploit children for criminal activity are not being held to account. As my hon. Friend the Member for Cardiff North said, only 30 charges under the Modern Slavery Act 2015 were flagged as child abuse in 2019-2020, against the 22,000—I think that was the figure—recognised by the Children’s Society in the same period.

Organised crime groups are aware of this situation and they are deliberately targeting children, because they know that by putting them on the frontline, it is much less likely that they themselves will be in the dock. The Government rightly adopted the statutory definitions of domestic abuse, coercive control and child sexual abuse, so I urge the Minister to do the same for vulnerable children experiencing criminal exploitation; they are victims, just as children of CSE are victims.

I will end with an example. I imagine that two thirds of Members, if not more, get here each week by train. I set those Members a challenge: speak to a train conductor, and I guarantee that they will be able to give daily examples of child criminal exploitation. They see the children going backwards and forwards, often without tickets but often with tickets paid for by the gang leaders. On my train, staff say that now they do not even bother looking for the children, because the common denominator is the bag that they carry either the drugs or the money in. It is different children going up and down, up and down, up and down—so conductors look for the bag and then report it to British Transport police.

British Transport police is funded by the railways. The service has a small budget and there are very few officers, so the likelihood of one being there when that train arrives is slender. Organisations like Railway Children try to support those children, but I guarantee that if Members speak to the conductor on their train, they will say, “Yes, that is happening on my train.”

11.15am

We are all very concerned about the example given by the hon. Lady. Why are the conductors and British Transport police not reporting those children to the police? That does not seem to be to do with the Bill; it seems to have something to do with what is happening in our criminal reporting processes.

Sadly, they are reporting it to the police, but the scale of the issue is so enormous and the resources are so intensive that nothing happens. I suggest the hon. Lady speak to her conductor. Normally what happens is that the child will be offered some support, but will then be very up front with the conductor, saying, “No, no—it’s my bag!” and so on. The child then gets off and there are not the resources to have a member of the British Transport police there, and that genuinely is not a criticism of them; I think there are only 4,000 officers for the whole country.

I mean the police—not the British Transport police.

British Transport police are the specific police for incidents that happen on the railways and transport networks. Even if we were looking at the Metropolitan police—I am going back and forth to London—the scale of the issue is so enormous that there is not the capacity to deal with it.

As somebody who has called the police in those circumstances, we are talking about a nine-day wait for anyone to come out. That is a problem.

Minister, it seems a ridiculously simple act to accept these two definitions, but the cascading of support and recognition within the victims code and our justice system would be enormous as a consequence. I have seen that at first hand with child sexual exploitation. I urge the Minister to look seriously into the two definitions.

Ordered, That the debate be now adjourned.—(Fay Jones.)

11.18am

Adjourned till this day at Two o’clock.

Energy Bill [ Lords ] (Sixteenth sitting)

The Committee consisted of the following Members:

Chairs: Dr Rupa Huq, James Gray, Mr Virendra Sharma, † Caroline Nokes

† Afolami, Bim (Hitchin and Harpenden) (Con)

† Blake, Olivia (Sheffield, Hallam) (Lab)

† Bowie, Andrew (Parliamentary Under-Secretary of State for Energy Security and Net Zero)

† Britcliffe, Sara (Hyndburn) (Con)

† Brown, Alan (Kilmarnock and Loudoun) (SNP)

† Clarkson, Chris (Heywood and Middleton) (Con)

† Fletcher, Katherine (South Ribble) (Con)

† Gideon, Jo (Stoke-on-Trent Central) (Con)

† Jenkinson, Mark (Workington) (Con)

† Levy, Ian (Blyth Valley) (Con)

† McCarthy, Kerry (Bristol East) (Lab)

† Morrissey, Joy (Beaconsfield) (Con)

† Nichols, Charlotte (Warrington North) (Lab)

† Owatemi, Taiwo (Coventry North West) (Lab)

Shelbrooke, Alec (Elmet and Rothwell) (Con)

† Western, Andrew (Stretford and Urmston) (Lab)

† Whitehead, Dr Alan (Southampton, Test) (Lab)

Sarah Thatcher, Chris Watson, Committee Clerks

† attended the Committee

Public Bill Committee

Tuesday 27 June 2023

[Caroline Nokes in the Chair]

Energy Bill [Lords]

9.25am

Before we begin, I remind Members that Hansard colleagues would be grateful if any speaking notes could be emailed to hansardnotes@parliament.uk. Please put electronic devices on silent, and tea and coffee are not allowed during sittings. The only refreshment permitted is water, which is available in the room. I might review my view on whether gentlemen can remove their jackets if it warms up later in the day.

New Clause 1

Smart meter roll-out for prepayment customers

“(1) The Secretary of State must ensure that all legacy prepayment meters are replaced with smart meters, unless the customer objects in writing, before the end of 2025.

(2) The Secretary of State must by regulations provide for an end to the practice of self-disconnections, such regulations to come into force within six months of the date on which this Act is passed.

(3) Regulations under subsection (2) may provide for, but are not limited to—

(a) the introduction of a social tariff for prepayment customers,

(b) the introduction of mechanisms to apply credit automatically if a prepayment customer runs out of credit, and

(c) the introduction of a mechanism to transfer a prepayment customer to credit mode automatically if they run out of credit.” —(Alan Brown.)

I beg to move, That the clause be read a Second time.

With this it will be convenient to consider new clauses 2 and 38.

It is a pleasure to serve under your chairmanship, Ms Nokes.

We are now in the final week of this Bill Committee, and Members will have spotted that a lot of Government new clauses and amendments have been tabled and accepted. In the spirt of fairness, the Government should also accept some of our new clauses and amendments; hopefully that is what is going to happen. Rather than getting into a debate, if the Minister wants to intervene and tell me which new clauses the Government will accept in the spirit of fairness, I would be happy to give way.

I would not like to put you off.

Okay, so we go back to my monologue justifying why the Government should accept some of our new clauses, including new clauses 1 and 2.

Clearly, we should be grateful that energy prices are starting to fall, but the reality is that the cap on energy bills for an average household was set at £1,138 in April 2021. This month, Ofgem has set the cap at more than £2,000, so energy bills are still nearly double what they were two years ago. The reality is that many people are struggling badly with their energy bills, even though prices are falling, and those struggling the most are those with prepayment meters. People with prepayment meters can access credit of only £5 or £10. If they reach that credit limit, the lights go out—it is as simple as that. They cannot turn on the gas or electricity, and it is a real difficulty for people. It also means that if people cannot get out of the house for whatever reason—if they are ill or have just had a newborn kid—and have reached the threshold, they lose access to their energy by virtue of not being able to top up their meters.

It is unfair that people with prepayment meters pay higher standing charges. Frankly, it is an outrage that people who pay in advance for their energy are paying a premium to access it, whereas people like us in this room, who pay by direct debit, have access to credit and cheaper tariffs. As I say, the reality is that if someone is on a prepayment meter, they are going to struggle to pay their bills, they will pay more and they will face the difficulties associated with a lack of credit.

As End Fuel Poverty states:

“Imposition of a pre-payment meter is disconnection by the back door. When you can’t top up the meter everything clicks off”.

Forcing people to have prepayment meters means that those who are already struggling are put on to a system whereby they will be forced to ration, automatically disconnected when the credit limit is reached and more likely—this is the rub—to have a cold, damp home, with the long-term health implications that that brings, as well as the short-term heating and eating dilemmas.

It is estimated that 19% of housing stock across the UK is damp. The proportion rises to nearly a third, or 31%, for those on prepayment meters. In other words, if someone is on a prepayment meter, they are 65% more likely than the average person to live in a damp house. Some 51% of prepayment customers have health conditions or disabilities, so in many ways the existing system is punishing those who are more likely to require more energy in the first place. That, in a nutshell, is why a social tariff is needed for those with prepayment meters.

Research by Utilita indicated previously that as many as 14% of the 4.5 million households with prepayment meters did not choose to be on such tariffs, and what has been happening during the cost of living crisis is outrageous. For example, an investigation for the i paper revealed that since the end of lockdown energy firms have secured almost 500,000 court warrants to forcibly install meters in the homes of customers who are in debt. Freedom of information requests showed that in the first six months of last year there were 180,000 applications for such warrants.

We then had the bombshell coverage of an undercover reporter working for bailiffs, which exposed the cruelty of some bailiffs for what it was: revelling in the forced installation of prepayment meters, no matter the vulnerabilities of the customers. The officers of that debt company were working on behalf of British Gas, which of course said that it was shocked and that it did not advocate such a policy.

The rub is that some utility companies are using debt collection agencies routinely as part of their process to collect money that they believe they are owed. That set-up relieves utility companies of the burden of debt collection. More importantly, it stops them providing debt advocacy and interacting with customers, which is what is required. Meanwhile, the debt collection companies add their own fees just for reissuing bills to customers.

All that is why we tabled new clauses 1 and 2. Voluntary codes for prepayment meters will never be enough. It is quite clear that we will never know how many people were forced on to prepayment meters against their will, especially when smart meters can be switched remotely to prepayment mode without people even realising initially.

New clause 1 sets out the need for legacy prepayment meters to be switched to smart meters as long as consent is given. This is an enabling aspect, as smart meters will make it easier to implement the provisions of new clause 1(3), which will end the practice of so-called self-disconnection. The provisions include the consideration of a social tariff, and, most importantly, mechanisms to allow customers to access credit and not be cut off immediately as they would be with a £5 or £10 credit limit.

New clause 2 restricts the forcible use of prepayment meters. It does not prevent informed consent and agreement for people to move to prepayment mode, because some customers like it as a way of managing their debt, but what is important is consent and an understanding of what prepayment means. The provisions also give access to impartial debt counselling services before the switch to prepayment mode is needed. Subsection (2)(c) places a duty on the Secretary of State to assess and define customer vulnerabilities, because the current definition is too narrow and does not cover some people who should be classed as vulnerable. Lastly, subsection (3) confirms that switching smart meters to prepayment mode is considered the same as a legacy prepayment meter.

Too many people have been forced on to prepayment meters. We cannot allow that to continue and we cannot allow the door to reopen for energy companies. No matter what they say here and now when there is an immediate storm and a backlash, we need to protect people for good going forward, which is what new clauses 1 and 2 will do.

According to recent Government figures, £120 million-worth of the vouchers issued for customers in prepayment mode were still unclaimed at the start of June. There are only four days left until the deadline on 30 June, so I hope the Minister will update us on the outstanding balance of unclaimed prepayment meter credit vouchers. Having nearly 20% of vouchers unclaimed at the start of the month is indicative of a failed policy that does not support the most vulnerable in our society. Again, that is why we need new clauses 1 and 2 to protect those who sometimes cannot protect themselves.

As always, it is a pleasure to see you in the Chair, Ms Nokes.

I rise primarily to speak in support of new clause 38, but it has quite a lot of overlap with new clause 2. Our new clause 38, on the restriction of the use of prepayment meters, says:

“The Secretary of State may by regulations restrict the installation of new prepayment meters for domestic energy use.”

It makes provision to ensure that consumers have full and informed consent on the installation of a prepayment meter, and that vulnerable customers are not put on to prepayment meters. We heard from the hon. Member for Kilmarnock and Loudoun some of the reasons why we have shared concerns about that. Some of my points will be very familiar to the Minister if he followed the debate earlier this year, when it reached crisis point.

Citizens Advice estimates that the number of people moved on to prepayment meters reached 600,000 in 2022, up from 380,000 in 2021. We know that that comes at a cost to them. There is a poverty premium on some of the most vulnerable, and on people on the lowest incomes, because of the shift to prepayment meters, and their use should be restricted as a result. Those with prepayment meters are more likely to be in fuel poverty and facing significant debts already. We find ourselves in a situation in which those requiring the most support are being forced to pay the most and are given the least help.

Citizens Advice revealed at the start of the year, at the height of the energy crisis, that someone was being cut off from their energy supply every 10 seconds, with millions unable to afford to top up their prepayment meters. We also know that so-called voluntary self-disconnection was a thing. People simply could not afford it, so they would not necessarily feature in the numbers. Labour’s call for a moratorium on the forced installation of prepayment meters was dismissed until the March Budget. The Secretary of State told the House on a number of occasions that he was talking to Ofgem and that plans were in motion, but during that period we were still hearing horrific stories about forced entry to people’s houses, warrants being issued and energy companies continuing to go down that path.

Our view was very much that it was the Government and the energy regulator’s responsibility to ensure that people were not left at home in the cold and the dark, yet we had to press incredibly hard before anything was achieved. Over the winter, more than 130,000 households that included a disabled person or someone with a long-term health condition were being disconnected from their energy supply at least once a week because they could not afford to top up. The same report also said that

“63% of PPM users who had disconnected in the last year said it had a negative impact on their mental health. This rises to 79% of disabled and people with long-term health conditions.”

Really good work was done by organisations such as Citizens Advice, but it also took tireless investigations from UK newspapers to expose the scale of the crisis. An investigation by the i in December showed that magistrates were batch processing hundreds of warrants in the space of a few minutes to allow the forced installation of prepayment meters, with one court in the north of England approving 496 warrants in just three minutes. At some point, we were given reassurances that people’s circumstances and vulnerabilities were being taken into account before the warrants were issued, but if nearly 500 are issued in three minutes, clearly they are not taking any information into account; it is very much a rubber-stamping exercise.

An undercover report by The Times in February highlighted how British Gas was employing debt collectors to break into people’s homes. Among them were customers described in the staff notes as a woman in her 50s with “severe mental health bipolar”, a woman who

“suffers with mobility problems and is partially sighted”,

and a mother whose

“daughter is disabled and has a hoist and electric wheelchair”.

We heard in debates at the time that many MPs had their own stories of constituents who were affected by the forced installation of prepayment meters; hopefully we will hear from some today to back up what we are calling for.

It was therefore a relief when action was taken in April, and a code of practice was introduced by Ofgem, but we have to wonder why the scheme is voluntary rather than compulsory. Just yesterday, the Committee on Fuel Poverty, in its annual report, expressed disappointment with Ofgem’s code of practice, stating that it is

“disappointingly limited in ambition”.

We have to wonder what the Government’s role is in that. I argue that Ofgem has proven incapable of dealing with the situation and it is up to the Government to step up and take control. That is what we seek to achieve with the new clauses.

The code’s voluntary nature still leaves too much power and judgment in the hands of energy suppliers, and the vulnerable and the voiceless should not be exposed to the dangers that prepayment meters pose, so I call on the Minister to give us some assurance that he accepts that it is the Government’s responsibility to act in this case—we cannot continue to leave it to voluntary codes of practice—and to support new clause 38.

It is an absolute pleasure to serve under your chairmanship again, Ms Noakes, for sitting 16 in the final week before we conclude our proceedings in Committee. I thank Members for tabling their new clauses.

New clause 1 places a duty on the Secretary of State to ensure that all legacy prepayment meters are replaced with smart meters before the end of 2025. The Government have been clear that our aim is for as many households as possible to benefit from smart metering, including those that prepay for energy, which is why we have set minimum installation targets for suppliers until the end of 2025. To ensure effective scrutiny and transparency, large suppliers are also required to publish their performance against their targets, broken down by credit and prepayment mode. That ensures that they have strong incentives to deliver.

Although we agree with the hon. Member for Kilmarnock and Loudoun that smart prepayment is highly superior to legacy prepayment meters, it is also true that those customers who would benefit the most from prepayment meters can be among the hardest audiences to reach and the most vulnerable in our society. It is therefore critical that we tread carefully and do not place unrealistic targets in statute that may cause unintended consequences.

As drafted, the new clause could result in the prioritisation of the replacement of traditional prepayment meters. That may inadvertently deprioritise smart meter installation for credit consumers, many of whom are in vulnerable circumstances. Data from Ofgem indicates that around 70% of those with disabilities pay by direct debit and may therefore benefit from the automated readings that smart meters deliver.

Let me turn to the requirement to end self-disconnections within six months of the Bill becoming law. It is critical that the market delivers a fair deal for consumers, with an energy market that is resilient and investable over the long term. Ofgem’s recently published code of practice on prepayment is clear that when self-disconnection occurs, suppliers must make multiple attempts to contact the customer to understand the reasons for self-disconnection and offer appropriate support, including additional support credit. If frequent or prolonged periods of self-disconnection are identified, energy suppliers should assess whether a prepayment meter remains a safe and practicable option for that consumer.

As announced in the 2022 autumn statement, His Majesty’s Government have committed to work with consumer groups and industry to consider the best approach to consumer protection from April 2024, as part of a wider retail market reform. In addition, as announced at the spring Budget, we are keeping the energy price guarantee at £2,500 for an additional three months from April to June. That means we have covered nearly half a typical household’s energy bill through the energy price guarantee and energy bill support schemes since October, with a typical family saving £1,500. That is in addition to the expanded warm home discount scheme, which has been extended until 2026 and provides £475 million in support per year in 2020 prices.

New clauses 2 and 38 would allow the Secretary of State to restrict the use of prepayment meters, especially in relation to vulnerable consumers or where consumers are not aware that they are being moved to a prepayment mode. It is of course critical that our most vulnerable energy users are protected. The findings in The Times regarding British Gas customers were shocking and completely unacceptable. The Government acted quickly to tackle that issue of inappropriate prepayment meter use, and the Secretary of State wrote to energy suppliers insisting that they revise their practices and improve their action to support vulnerable households.

Following that intervention, all domestic energy suppliers agreed to pause the forced installation of prepayment meters and the remote switching of smart meters to prepayment mode. Ofgem rules are clear that suppliers can install a prepayment meter to recover a debt only as a last resort. They also require energy suppliers to offer a prepayment service only when it is safe to do so, with clear obligations on energy suppliers regarding support for customers in payment difficulty. The Secretary of State has called for more robust Ofgem enforcement on those issues, and Ofgem has responded by announcing a further review of supplier practices relating to prepayment meter customers.

The Minister may be about to come to this point, but I am wondering how it is going—does he know how many warrants are now being issued by the courts? Is he aware of statistics on how many prepayment meters are now being installed or on the type of customers who are being put on them?

I do not have the exact numbers at my fingertips, but I am happy to write to the hon. Lady with that information. I can tell her that the senior presiding judge has ordered magistrates courts to immediately stop authorising warrants for energy firms to forcibly install prepayment meters while the process by which suppliers bring forward such applications is being reviewed.

9.45am

In his reply to my hon. Friend the Member for Bristol East, will the Minister expand briefly on his understanding of the meaning of the word “pause” in relation to the forcible installation of prepayment meters by energy companies? As far as I am aware, there is no time set for that, nor is it subject to any other actions that the Government may take. Is it the Minister’s understanding that the pause is strictly time-limited and that practices may start again at the end of it?

The pause will be until Ofgem has finalised the review of supplier practice in relation to prepayment meter customers. That is what we expect, anyway, because in addition to what I have said this morning, the Secretary of State has told Ofgem to toughen up on energy suppliers and to investigate customers’ experiences of how their supplier is performing. Following that, Ofgem established a new customer reporting system for households to pass on their experiences of how they are being treated. We are approaching this across the board. We believe, however, that any ban on the forced installation of prepayment meters would risk a build-up of customer debt. Unpaid debts increase costs for all energy consumers and could pose a risk to supplier stability.

To address issues around the forced installation of prepayment meters, Ofgem has recently published a new code of practice, as I mentioned. The code has been agreed with energy suppliers to improve protections for customers being moved involuntarily to a prepayment meter. It ensures better protections for vulnerable households, increased scrutiny of supplier practices, and redress measures where prepayment meters were wrongly installed. It includes provisions to prevent involuntary installations for all high-risk customers, including those dependent on powered medical equipment, people over 85, and households with residents with severe health issues. It also includes a requirement for suppliers to reassess whether prepayment remains the most suitable and preferred payment method for a customer once they have repaid debts. Suppliers must agree to any request from a prepayment customer who is clear of debt to move off a prepayment meter.

The rules to which suppliers must adhere regarding the installation of prepayment meters are set out in the licence conditions set by Ofgem as the independent regulator. Ofgem will undertake a formal statutory consultation process to modify suppliers’ licence conditions in line with the code ahead of this winter. This will allow Ofgem to use its full enforcement powers to enforce compliance with the code, ensuring that consumers are protected and that the poor practices that we have seen will not happen again.

It is vital that, as the independent regulator, Ofgem continues to set the rules to which energy suppliers must adhere in licence conditions. New clauses 2 and 38 would risk taking that power away from Ofgem. Allowing the Government to set rules outside the licence conditions would threaten Ofgem’s independence and its ability to regulate suppliers effectively.

The Government have always been clear that action is needed to crack down on the practice of forcing people, especially the most vulnerable, on to prepayment meters. We will continue to work closely with Ofgem and industry to see that the code leads to positive changes for vulnerable consumers. I hope that hon. Members are reassured by my explanation and that they might feel able to withdraw their new clauses.

Despite what the Minister says, I am not fully convinced by those arguments. With the leave of the Committee, I will not press new clause 1 to a vote, but it is important to understand that new clause 2 would not even mean an outright ban on the installation of prepayment meters; it would just put protections in place so that people are not forced on to prepayment meters. It would also address debt build-up by ensuring that people are given access to debt counselling, for example. New clause 2 is about working with customers and providing additional protections, so I would certainly like to press it to a vote.

On new clause 1, I beg to ask leave to withdraw the motion.

Clause, by leave, withdrawn.

New Clause 2

Restriction of the use of prepayment meters

“(1) The Secretary of State may by regulations restrict the installation of new prepayment meters for domestic energy use.

(2) Regulations under subsection (1) may set conditions for energy suppliers in relation to the installation of new prepayment meters, including—

(a) ensuring consumers have given full and informed consent to the installation of a prepayment meter after having been offered access to a recognised debt counselling agency;

(b) ensuring vulnerable consumers are not required to use prepayment meters;

(c) publishing a non-exhaustive list of circumstances in which a consumer is considered vulnerable, including financially vulnerable; and

(d) ensuring consumers have a clear, timetabled route back to standard meters once specified conditions are met.

(3) In this section ‘installation of new prepayment meters’ includes switching existing energy meters to a prepayment mode.”—(Alan Brown.)

This new clause would allow the Secretary of State to restrict the use of prepayment meters, especially in relation to vulnerable consumers or where consumers are not aware they are being moved over to a prepayment mode.

Brought up, and read the First time.

Question put, That the clause be read a Second time.

Division 13

New Clause 5

Net Zero compatibility test

“The Secretary of State must by regulations make provision, with effect from the date on which this Act is passed, for all future legislative Impact Assessments to include a ‘Net Zero compatibility test’.”—(Alan Brown.)

Brought up, and read the First time.

I beg to move, That the clause be read a Second time.

This fairly simple clause seeks for the Government to include in all future legislative impact assessments a net zero compatibility test. Achieving net zero is vital to save to planet. The Government have legally binding targets to hit net zero by 2050, and this Committee has agreed to Government amendments that give Ofgem a statutory duty to consider net zero. If the regulator is obliged to consider net zero, and if the Government have legal targets to achieve net zero, surely it makes sense to legislate for the Government to undertake a net zero compatibility assessment, so as to ensure that policies will not have an adverse impact on the legally binding target to achieve net zero. That would result in transparency on whether policies are adversely or positively impacting on the route to net zero. Such transparency would also be of assistance with costs, especially given the net zero cynics among Government Members. Importantly, Energy UK, the trade body that represents energy companies, also says that it supports a net zero compatibility test.

Given what I have outlined, I do not see why the Government would not accept the new clause. If the Government can carry out impact assessments of the effect of legislation on small businesses, why not carry one out on the wider, legally binding target to hit net zero? I hope that the Minister will accept the new clause.

I thank the hon. Members for Kilmarnock and Loudoun and for Argyll and Bute (Brendan O’Hara) for tabling their new clause. The Government agree with the intention behind it, but we believe that it is unnecessary. We are already taking a cross-Government and systematic approach to embedding net zero and climate into Government policies and decision-making processes.

The creation by the Prime Minister of the new Department for Energy Security and Net Zero, which I am proud to serve, means that there is an entire Department dedicated to delivering on our climate ambitions. The Department’s focus, alongside energy security, is driving overall delivery of net zero and maximising the economic opportunity that the transition presents. The new Department’s officials work with counterparts across Government to co-ordinate action, working particularly closely with the Cabinet Office and the Treasury to ensure that net zero is prioritised in Government policy and decision making, and that it aligns with our wider priorities.

We are also working with industry and stakeholders, which has led to the creation of the net zero council, the green jobs delivery group, the jet zero council and the local net zero forum. We also work closely with our devolved Administration colleagues. We have also gone further by creating the Domestic and Economic Affairs (Energy, Climate and Net Zero) Committee, which brings together senior Ministers from across Government to ensure a co-ordinated approach to delivering net zero across government. Additionally, we have provided Green Book supplementary guidance on the valuation of energy use and greenhouse gas emissions for appraisal. That guidance helps officials when undertaking options appraisal for policies, programmes and projects; building business cases; and when conducting impact assessments. I hope that provides the hon. Member with the reassurance that he needs to withdraw his new clause.

The Minister smiled when he said he hoped that that would satisfy me. There is no surprise that it does not. He outlined the creation of the new Department for Energy Security and Net Zero, and the important thing is that the net zero compatibility test would apply to all legislation that the Government introduce from every Department, so it would make every Department start to consider the net zero implications of its policies. That is what is critical about this new clause. I do not wish to withdraw the motion.

Question put and negatived.

New Clause 6

Just Transition Commission

“(1) Within six months of the date on which this Act is passed the Secretary of State must by regulations establish a body to be known as the ‘Just Transition Commission’.

(2) Regulations under subsection (1) must provide for the purposes of the Just Transition Commission to include—

(a) the provision of scrutiny and advice on the ongoing development of just transition plans;

(b) the provision of advice on appropriate approaches to monitoring and evaluation; and

(c) consultation with such persons as the Secretary of State shall consider appropriate in relation to the delivery and likely impact of just transition planning.

(3) The Just Transition Commission must produce and lay before Parliament an annual report of its work.”—(Alan Brown.)

Brought up, and read the First time.

I beg to move, That the clause be read a Second time.

I shall potentially continue my losing streak here. This new clause is about setting up a just transition commission. The Committee may be aware that the Scottish Government set up a just transition commission a couple of years ago, which is effectively world leading. It brings together independent academics, and representatives from trade unions and right across industry. It advises the Scottish Government on policy implications and what is needed as we move forward to a just transition to ensure that workers are not left behind and do not lose their jobs, to be effectively left on the scrapheap.

This important body came together and has brought transparency to the Scottish Government, and I want to see that replicated at Westminster. It would be good for the Government as a way to work across the sector and the industry, with trade unions and academics to provide expertise. I look forward to hearing the Minister’s thoughts on that, explaining why they are probably not going to do this in the short term. I will be happy to be proved wrong on that.

We certainly need more focus, and to hear more from the Government about ensuring that this is a just transition. We know that we cannot reach net zero without the skilled workforce to deliver it, and without decisive action to ensure that no community is left behind. It is illustrative to look at what Joe Biden is doing with the Inflation Reduction Act in the United States, where a lot of focus is on energy-intensive states such as Texas to ensure that, as they move away from fossil fuel exploration, the jobs are still there. We all know what happened, as we debated earlier in this Committee, when the coalmines were closed with the lack of a strategy to ensure good, decent jobs for people left behind. We saw whole communities abandoned and, in some parts of the country, turned into basic commuter villages, rather than having a home-grown industry.

It has rightly been said that net zero is the economic opportunity of the century, but it represents a potential threat to those who, at the moment, rely on traditional industries. That is not because oil and gas extraction will immediately cease, or because coal-fired blast furnaces will suddenly be switched off. It is because our reliance on the old way of doing things will gradually decline and, as a result, the skills required will evolve.

Workers in those industries need to know that there is a plan. As I said, we cannot allow the mistakes of the 1980s to be repeated. We need a forward-looking industrial strategy, to make it clear that the transition to net zero is an opportunity to reinvigorate our industrial heartlands and coastal communities and to make it clear that that means a higher quality of work, better regulation of employment practices and greater diversity in the sector. This is quite a complex task. Some of it will be industry-led, but we know, particularly when we get further down the supply chain to those clusters of jobs that will be based around the traditional industries, that those smaller companies will need support to diversify as well.

10.00am

At the moment, decarbonisation is heavily dependent on overseas skills and imported products. We have not seen a response from this Government to the Inflation Reduction Act. We are told that it might come in the autumn, but we also get mixed messages from Ministers—from the Secretary of State, for example, and from the Minister of State in the Department—saying that it is simply a case of the US racing to catch up with us and we are far ahead of the curve, as though we do not need to respond to what is happening in other countries.

We know, because of labour shortages, that in some areas money is simply not being spent. An example is the green homes grant. The local authority delivery scheme had a 35% underspend. I will be in Westminster Hall this afternoon to talk about retrofitting of homes. Some 19 million homes need retrofitting to bring them up to decent energy efficiency standards. There does not seem to be a strategy for that workforce to be there, and that will in part mean people transitioning from more traditional jobs—such as installing gas boilers—to installing heat pumps, for example. There is no clear road map; we do not have an industrial strategy.

The TUC was calling for a just transition commission years ago. My concern about the SNP new clause is that setting up a just transition commission at some point in the future could lead to further delay. We had the Green Jobs Taskforce, and following that, the Green Jobs Delivery Group. Next year, we are due to get the net zero and nature workforce action plan. I commend Scotland for setting up its Just Transition Commission, but the Prospect union has warned that Scotland still

“lacks a clear strategy for job creation”

and it “falls disappointingly short” in this “vital area” at the moment. Scotland was promised a jobs revolution, but not even a quarter of the green jobs promised by the SNP in 2010 have materialised.

The hon. Lady will be aware that procurement rules and contracts for difference auctions, for example, are reserved to Westminster, so the Scottish Government do not have control of that. There is a whole supply chain aspect that is not developed, and that is partly because of these procurement rules—the fact that the cheapest price takes all. We want that amended at some time.

I was about to move on to that, because it is important. On the Government’s lack of action on developing a strategy, I have been trying to ask questions about the Green Jobs Delivery Group, such as when we will actually see some delivery and outcomes and how that will feed through into a skills strategy and an industrial strategy, but I have been getting very little by way of response.

Friends of the Earth Scotland has called on both the UK Government and the Scottish Government to ensure greater worker representation in their transition planning through existing bodies such as the UK’s Green Jobs Delivery Group and the Just Transition Commission in Scotland. It says that at the moment there is little support provided for high-carbon workers to find alternative jobs, to facilitate retraining where necessary, or to lighten the financial burden of training currently borne by the workers.

Last month, the Climate Change Committee briefed that the

“Government has policy levers at its disposal to support workers during the transition”

but warned that

“clearer plans are needed to harness the potential of the transition and to manage its risks.”

Work has been done. As I said, my concern is about focusing on setting up a commission rather than just calling on the Government to actually come forward with a clear strategy, a clear road map, particularly on the skills front, and to link that up. I do not know whether the Minister will accept my analysis of the situation, but it seems very fragmented. It is left, in large part, to big companies in the supply chain to try to ensure that the workers of the future are there as they transition. There is not a strategy for the smaller companies in the supply chain unless the big companies are leading that.

I understand what the hon. Lady is saying about wanting the Government to get on with it sooner, but does she not agree that commissioning a body of experts will provide better advice, enabling the Government to develop their strategy better?

As I said, the Government have had their green jobs taskforce, and now they have the delivery group. They are also doing things on the nature side. I would argue that they should have had all the information and expert advice; it is all available out there.

What we need are more incremental steps. Rather than setting up a body, we need something concrete from the Minister on what the Government are doing, for example, to ensure that further education colleges are tying up with the potential needs of businesses in their areas. Some incredibly good further education colleges are working on that—going into schools, working with businesses and encouraging young people to look at those careers—but as I said it is piecemeal and depends on the quality of the college, and the relationship with other agencies in the local area. I sympathise with focusing on a just transition, but I have concerns about whether setting up another body is the way to do it.

I thank the hon. Members for Kilmarnock and Loudoun and for Bristol East for their contributions. The Government agree with the intention behind the new clause; however, we already view transition as a consideration embedded across all Government policy actions. We are committed to managing the transition to net zero in such a manner that the positive opportunities are maximised for the economy and the population, while protecting individuals, communities and the economy.

Given that the majority of the low carbon economy lies outside London and the south-east of England, Government action to deliver our net zero commitment and build a low carbon economy will help to level up the UK and spur on the transition. That is demonstrated through the North sea transition deal agreement in March 2021, through which the UK became the first G7 country to agree a landmark deal to support the oil and gas industry’s transition to clean, green energy, while supporting 40,000 jobs in industrial heartlands across the UK.

Since delivering a net zero workforce transition needs joint action by Government, industry, and the education sector, the Government have established the green jobs delivery group. The group is headed up by Ministers and business leaders to act as the central forum for driving forward action on green jobs and skills, and has committed to publishing a net zero and nature workforce action plan in 2024, which will consider the workforce transition. We will continue to join up across the devolved Governments, who have already made excellent progress, with the Welsh Government having launched their net zero skills plan in March 2023, and the Scottish Government and Skills Development Scotland having launched their climate emergency skills action plan 2020-2025 in 2020.

On working with the devolved Governments, does the Minister recognise that it is time for the UK Government to match fund the £500 million just transition fund that the Scottish Government have put in place?

I thank the hon. Member for his intervention, and point him to the remarks that I just made regarding the huge investment that we are already making in the transition, the fact that we were the first G7 nation to sign a transition deal, and the £100 billion of private sector investment by 2030 that we hope to see, and that we are driving into British industries, supporting 480,000 green jobs by the end of the decade. We are looking to meet that target, unlike the Scottish Government’s green jobs target, which of course they have not met—alongside failing in four years out of five to meet their climate change targets, as was announced just last week. Since delivering a net zero workforce transition needs joint action by Government and industry, as I have said, we are continuing in that regard.

With respect to the scrutiny advised in the new clause, the Government already report progress on delivering our net zero ambitions through multiple channels—through parliamentary Select Committees, the Public Accounts Committee, independent bodies such as the National Audit Office, and—under the Climate Change Act 2008—the Climate Change Committee. I should point out that the hon. Member’s colleague and friend, the hon. Member for Na h-Eileanan an Iar (Angus Brendan MacNeil), has recently taken up the chairmanship of the Energy Security and Net Zero Committee, and will, I am sure, ably hold my Department to account. I hope that that provides the hon. Member for Kilmarnock and Loudoun with the reassurances that he needs to withdraw the motion.

It is a pleasure to serve under your chairmanship, Ms Nokes. I have asked a few written questions in this space and I agree wholeheartedly with my hon. Friend the Member for Bristol East that the just transition should have already started for many workers. A survey two years ago found that workers were looking to move from the fossil fuel industry to renewables but that they were being put off by training fees. I have asked repeatedly about that.

I asked the Department whether it knew what the average cost of retraining would be for oil and gas workers but was told that it does not know or does not hold that data. However, I have heard at first hand from oil and gas workers who want to move into renewables that they face training costs of many thousands of pounds and that the quality of such training is questionable in some places. Government inaction risks leaving those workers behind when they want to be part of the transition and already have transferrable skills in those industries. I also recently asked a question about the Department’s discussions with the offshore wind industry on recognising an energy skills passport to help oil and gas workers, but was told in response that no such discussions have taken place.

I thank the Minister for his kind words about a transition. However, when will we see action for oil and gas workers? When will the inaction turn into action and delivery so we can get on with developing the green skills we need in this country to deliver net zero and compete in a global market?

I thank the hon. Member for Sheffield, Hallam for the tone of her words. The Government believe that the best way to secure jobs for oil and gas workers is to continue to give them support and, indeed, to support investment into the North sea, which not only provides secure employment for them now and into the future but provides for our energy security needs, which is something the Labour party might take note of moving forward.

As a representative of a constituency in the north-east of Scotland, I am fully aware of the pressures that workers in the North sea oil and gas industry face and the desires of many of them to transition to new green jobs. We see that in the city of Aberdeen, which is transitioning from being the oil and gas capital of Europe to the energy capital of Europe. That is why we have set up our green jobs delivery group and why we are identifying recommendations and actions for central and local government, industry and business, and the devolved Administrations.

We are also exploring how we can support local areas to deliver a successful transition, and the Department for Work and Pensions is expanding sector-based work academy programmes to help those who are out of work develop the skills they need to re-enter the job market. The programme runs in England and Scotland and is developed by jobcentres in partnership with employers and training providers. The Government take that incredibly seriously and I have a particular interest in the matter.

I thank the hon. Lady for her comments, but we are clear that it is very important to support people who are reskilling and upskilling from traditional oil and gas jobs into new green jobs, while also investing in our oil and gas industry to ensure that investment continues to support the traditional jobs that will be needed for some time yet.

The Minister puts forward arguments that suggest the Government are doing a lot in terms of green jobs. The Government are doing some things, but not enough. That is the reality.

To go back to my intervention on the hon. Member for Bristol East, the CfD rules should have been changed years ago to incentivise supply chain development and create those homegrown jobs. Perhaps a just transition commission would have provided advice on how that procurement could have been taken forward. I want to revisit that. The Government should think and should speak to people engaged in the just transition commission. In the meantime, I beg to ask leave to withdraw the motion.

Clause, by leave, withdrawn.

New Clause 33

Purposes

“(1) The principal purpose of this Act is to increase the resilience and reliability of energy systems across the UK, support the delivery of the UK’s climate change commitments and reform the UK’s energy system while minimising costs to consumers and protecting them from unfair pricing.

(2) In performing functions under this Act, the relevant persons and bodies shall have regard to—

(a) the principal purpose set out in subsection (1);

(b) the Secretary of State’s duties under sections 1 and 4(1)(b) of the Climate Change Act 2008 (carbon targets and budgets) and international obligations contained within Article 2 of the Paris Agreement under the United Nations Framework Convention on Climate Change;

(d) the desirability of securing a diverse and viable long- term energy supply.

(3) In this section ‘the relevant persons and bodies’ means—

(a) the Secretary of State;

(b) any public authority.”—(Dr Whitehead.)

This new clause and NC34, NC35 and NC36 are intended as a suite of purpose and strategy clauses for this Bill.

Brought up, and read the First time.

10.15am

Question put, That the clause be read a Second time.

Division 14

New Clause 38

Restriction of the use of prepayment meters

“(1) The Secretary of State may by regulations restrict the installation of new prepayment meters for domestic energy use.

(2) Regulations under subsection (1) may set conditions for energy suppliers in relation to the installation of new prepayment meters, including—

(a) ensuring consumers have given full and informed consent to the installation of a prepayment meter;

(b) making provision to ensure vulnerable consumers are not put onto prepayment meters.

(3) In this section ‘installation of new prepayment meters’ includes switching existing energy meters to a prepayment mode.”—(Kerry McCarthy.)

Brought up, and read the First time.

Question put, That the clause be read a Second time.

Division 15

New Clause 39

Guarantee for consumer protection

“(1) Within three months of the day on which this Act is passed, Ofgem must set out a new licence to operate for heat networks that guarantees equivalent protections for heat network customers compared when compared with electricity and gas customers.

(2) Protections under subsection (1) must include but are not limited to—

(a) a price cap for heat network customers;

(b) a licence condition to ‘treat customers fairly’, analogous to Licence Condition 0 of the electricity and gas supplier licences; and

(c) a licence condition addressing ‘ability to pay’, analogous to Licence Condition 27A of the electricity and gas supplier licences.”—(Dr Whitehead.)

This new clause would guarantee that heat network customers receive equal treatment to electricity and gas customers.

Brought up, and read the First time.

Question put, That the clause be read a Second time.

Division 16

New Clause 41

Energy performance regulations relating to existing premises

“(1) Within six months of the date on which this Act is passed the Secretary of State must make regulations—

(a) amending the Energy Efficiency (Private Rented Property) (England and Wales) Regulations 2015 (S.I. 2015/962) to require that, subject to subsection (2), all tenancies have an energy performance certificate (EPC) of at least Band C by 31 December 2028; and

(b) amending the Energy Efficiency (Private Rented Property) (England and Wales) (Amendment) Regulations 2019 (S.I. 2019/595) to raise “the cost cap” to £10,000.

(2) Exemptions to subsection (1) apply where—

(a) the occupier of any premises whose permission is needed to carry out works refuses to give such permission;

(b) it is not technically feasible to improve the energy performance of the premises to the level of EPC Band C; and

(c) another exemption specified in the Energy Efficiency (Private Rented Property) (England and Wales) Regulations 2015 has been registered in the PRS Exemptions Register.

(3) Within six months of the date on which this Act is passed the Secretary of State must make regulations—

(a) amending the Energy Efficiency (Private Rented Property) (England and Wales) Regulations 2015 (S.I. 2015/962) to enable Local Authorities to give notice to landlords that they wish to inspect a property, requesting permissions from landlords and any tenants in situ at the time to carry out an inspection at an agreed time;

(b) to expand the scope of the current PRS Exemptions Register and redesign it as a property compliance and exemptions database;

(d) to require a valid EPC be in place at all times while a property is let; and

(e) to raise the maximum total of financial penalties to be imposed by a Local Authority on a landlord of a domestic PRS property in relation to the same breach and for the same property to £30,000 per property and per breach of the PRS Regulations.

(4) The Secretary of State may make regulations to—

(a) enable tenants in the private rented sector to request that energy performance improvements are carried out where a property is in breach of the Energy Efficiency (Private Rented Property) (England and Wales) Regulations 2015; and

(b) make provision for a compensation mechanism where a tenant is paying higher energy bills as a result of a property not meeting the required standard.”— (Dr Whitehead.)

This new clause requires the Secretary of State to strengthen minimum energy efficiency standards in the private rented sector, expands the compliance regime available to local authorities, and gives the Secretary of State the power to create a compensation mechanism for tenants adversely affected by non-compliance. These measures are derived from the government’s preferred policy option in the 2020 “Improving the energy performance of privately rented homes” consultation.

Brought up, and read the First time.

Question put, That the clause be read a Second time.

Division 17