Government must take stronger action to help those facing huge fuel bills

12.00.00am BST (GMT +0100) Thu 31st Jul 2008

A 35% rise in gas bills and a 9% hike in the price of electricity for British Gas customers are totally unacceptable and must be matched by Government action, the Welsh Liberal Democrat Spokesperson on Social Justice, Peter Black, has said.

Echoing the comments of Liberal Democrat Shadow Chancellor, Vince Cable today, Mr. Black has called on the government to take practical action to help consumers who now face annual bills well over £1,000 just to heat and run their home.

"If the Prime Minister is looking for an issue by which he can make people take him seriously again then this is it," said Mr. Black. He needs to be decisive and uncompromising. Customers have been at the mercy of market forces on gas and electricity prices for too long. We need a government that does not just understand the economic pain but does something about it.

"In particular there are five points that I would like the UK Government to address. Firstly, they must ensure that the £9 billion windfall the energy companies have received from the Emissions Trading Scheme is used to help reduce fuel bills for the most vulnerable customers. Secondly, they must face up to the reality of a market dominated by six huge energy companies that have effectively stopped competing with each other on what they charge their customers. There must be a full investigation by the Competition Commission into what is happening.

"Thirdly, there should be a £500 million plus rolling programme over ten years to ensure that all British homes are properly insulated, cutting carbon emissions and reducing fuel bills. There should also be urgent action on pre-payment meters. According to recent research commissioned for Energywatch, those on pre-payment meters can pay up to £142 more than people on direct debits on their combined gas and electricity bills. With around a quarter of poorer fuel customers on pre-payment meters, this has to be a priority.

Finally, there should be a systematic investment in smart meters, which display consumption costs and enable customers to plan their energy usage. Energywatch has shown energy usage can be reduced by between 3 and 15 per cent through changes in behaviour. With a 5 per cent reduction translating into a bill reduction of around £35, this can also help reduce fuel poverty. What is more, the introduction of smart meters that can be read remotely could also significantly benefit the energy companies."