Caroline Flint MP, Labour’s Shadow Energy and Climate Change Secretary, today launched Labour’s plan to end the scandal of cold homes. Speaking in Hastings, and building on Labour’s energy price freeze, she announced a major drive on home insulation and set out plans to deliver long-term, permanent savings on energy bills and warmer homes for millions of people. The plans will mean that at least five million homes are upgraded over 10 years, saving the average household more than £270 a year from its energy bill.
The Green Paper is available here.
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Sarah, thank you for that introduction.
It’s great to be here with you today in Hastings.
We’re less than six months away from the next General Election.
And the road to Downing Street runs through Hastings, so I hope to be back here many more times before next May.
What you’ll be seeing from Labour in the next few months is us setting out The Choice facing the British people at the General Election in 2015.
Today I’m going to focus on energy bills – something I know Sarah hears a lot about when listening to local people in Hastings – whether that happens to be a working family, a struggling pensioner or a growing business.
All of us have seen our energy bills rising year on year.
And figures I published a few months ago laid bare the full scale of the cost-of-living crisis and David Cameron’s failure to tackle rip-off energy bills.
Because, on David Cameron’s watch, energy bills in Britain have risen by over £300 - twice as fast as inflation, four times faster than wages and faster than almost any other country in the developed world.
Households cannot afford another five years of this.
Hastings cannot afford another five years of this.
Britain cannot afford another five years of this.
So today I want to tell you what Labour will do about it, and to set out The Choice that people in Hastings and around the country will face at the next election.
To start with, on entering office, Labour will immediately freeze energy prices until 2017.
In Hastings and Rye, nearly 50,000 households will save an average of £120.
And across the country, our price freeze will save money for Britain’s 27 million households and 2.4 million businesses.
Why are we freezing prices? For two very simple reasons.
First, people have been overcharged.
We’ve looked very carefully at the prices consumers have paid in the last few years, compared to the costs the companies have faced.
And it’s clear to us that when wholesale prices have gone up, consumers’ bills have gone up too.
But when those costs have come down, consumers have not seen the full benefit.
So we would stop prices rising further as a way of compensating consumers for overcharging in the past.
But the second reason is to give us time to change the rules of the game for good.
No-one’s pretending the solutions to our energy market are simple, or can be implemented overnight.
So during Labour’s 20 month price freeze we will reform the energy market.
We’ll break the stranglehold of the Big Six and stop energy companies doing secret deals, which make it almost impossible for anyone to know what the true cost of energy actually is.
And we’ll create a tough new watchdog, with a bite as a good as its bark.
With a power to make sure wholesale price cuts are passed to the customer.
To make suppliers behave professionally.
When you misbehave, pay a fine, it’s not over.
The slate is not wiped clean.
Keep breaking the rules, treating your customers badly, and you will be shut down.
But the cheapest energy is the energy we don’t use.
One of the main reasons energy bills have risen – and will continue to rise, unless something is done about it – is because our homes are among the least insulated and the least energy efficient anywhere in Europe.
Heat is going straight out of our roofs, windows and walls.
We might as well burn money.
My plan is not just to freeze energy bills.
But, in the next phase of our reforms, to enable millions of people to permanently cut them.
Let me tell you two really startling facts.
Number one: households living in the least insulated properties have energy bills which are over £1,000 a year higher than households living in properties with good insulation.
Number two: two thirds of households in fuel poverty live in properties with poor insulation. Poor energy efficiency is the single biggest reason why so many households are in fuel poverty.
In Hastings and Rye one in ten households are in fuel poverty.
This was something we began to address when Labour was last in power.
The Decent Homes programme resulted in the installation of 700,000 new kitchens, 525,000 new bathrooms, over 1 million new central heating systems and the re-wiring of 740,000 homes.
Warm Front helped over 2 million households improve their energy efficiency and insulation, including over 3,000 households in Hastings and Rye.
But there is much, much more to do.
And it is clear that the policies of the current Government do not meet the scale of this challenge.
They created a scheme called the Green Deal.
They said it would be the biggest home improvements programme since World War 2.
The idea was a good one, and one all parties supported.
You could take out a loan to improve your home.
And the savings on your energy bills as a result of the improvements would be greater than the cost of repaying the loan.
The problem has been the practical delivery of the policy.
Interest rates of 7 per cent or more.
And, originally, hefty penalty payments – potentially running into thousands of pounds – if you tried to pay back the loan early
That’s why nearly two years after it launched, just two and a half thousand household and no businesses – not a single one – have actually taken out a Green Deal.
That doesn’t sound the biggest home improvements programme since World War 2 to me.
Then there’s the Energy Company Obligation.
Again, in theory it’s a good idea, and it’s builds on similar schemes that have existed for fifteen years or more.
Energy companies are obliged to help customers with their energy efficiency, with free insulation.
Nearly half the money doesn’t go to people in or at risk of fuel poverty – so, often, the people who need most help don’t get it.
And even households that do get assistance only receive one measure – which is better than nothing, obviously, but not enough to make a real difference and almost never enough to lift them out of fuel poverty.
That’s why I’m here in Hastings today to launch my Green Paper on how we end the scandal of cold homes for good.
Learning the lessons of previous energy efficiency programmes, my Green Paper proposes an ambitious, long-term programme to:
lift and protect people from fuel poverty;
support millions of households and businesses to improve their energy efficiency;
and establish energy efficiency as a national infrastructure priority.
It sets out six new policies to meet this challenge.
First, half a million free personalised home energy reports a year.
Two thirds of households have never had an energy efficiency assessment, so they don’t know whether their home could benefit from improvements, or how much they could save.
So the first step is to give people this information.
Second, we have to make sure that every penny that the energy companies are required to spend goes to those households that need it most.
I love Downton Abbey as much as the next person – but the Crawley family can pay for their own insulation.
If we made that change, we’d have enough money to help at least 200,000 households a year who are in or at risk of fuel poverty, and save them, on average, over £270 from their energy bills.
And we will end the ridiculous situation where we only install one measure at a time – if we’re going into someone’s home to improve their energy efficiency, let’s get the job done in one go.
Similarly, I don’t think energy companies are the best people to be delivering this.
They’re not trusted – a lot of people, understandably, simply don’t believe them when they say they want to help.
In fact, so little are they trusted that we had one case a couple of years ago of one company offering people £50 to find other people to have home improvements done for free.
That is ridiculous – and it’s a waste of money.
Every pound that is spent finding people is a pound not spent on insulation or energy efficiency.
So I want to put local authorities and housing associations and other community groups in the driving seat – because they’re trusted and they know who needs help.
That’s the second step: help to those that need it most.
But obviously, energy bills aren’t just a problem for people in fuel poverty.
So, third, we will support households who want to do the right thing and are able to shoulder some of the costs.
To do that we will provide up to a million interest-free loans for home improvements to households in the next Parliament.
That will be a big help for homeowners.
But we have to help people who rent too.
The private rented sector has highest proportion of the coldest properties and, as a result, the highest levels of fuel poverty.
But this Government’s response has been hopeless.
Its regulations will do nothing for four out of five households in fuel poverty in the private rented sector.
So, fourth, we will set a new, tougher target for landlords to get cold and leaky properties up to a decent standard.
In return for asking them to improve their properties to a higher standard, we will give them more time to do it.
That’s a fair compromise.
Taken together, those four measures, will help at least 5 million homes in 10 years.
All within the Government’s existing budget.
My plan lays the foundation for a transformative approach to energy efficiency.
But, fifth, because we know this is a long-term task, we will designate energy efficiency as a national infrastructure priority, under our proposed National Infrastructure Commission
Of course, improving energy efficiency is crucial not just for homes, but also for non-domestic buildings such as commercial offices, factories, schools and hospitals.
Because energy efficiency can cut costs for businesses and the public sector, insulate them from future energy price rises.
So our Green Paper sets out a number of ways we will help business, especially small businesses, save money on their energy bills too.
The message I want to leave you with this morning is this:
This Green Paper not only describes the kind of Britain we believe in, it describes one we can achieve.
A Britain in which we bring an end to cold homes.
Our country needs more than warm words.
It needs a plan for warm homes.
A plan which creates new jobs and opportunities for apprentices.
A plan which moves towards a fairer Britain, where all homes can reach a standard of comfort, and where those with the least do not pay ever-rising sums to heat their homes.
This journey reduces bills, reduces fuel poverty and by creating warmer, more efficient homes, it improves health and wellbeing for millions of British people.
But this journey is not just for a few, and not just for those with limited means.
The range of initiatives we describe offer something for everyone.
For the hardworking family and for the struggling pensioner.
In this vision of Britain, no one is left in the cold.
We make demands of landlords, we challenge energy companies to raise their game and we insist on public money delivering value for you, the taxpayer.
We do right by our planet, and we show that social justice goes hand in hand with enterprise and creating new jobs, in a more modern Britain.
This is part of Labour’s plan for Britain’s future.
A Britain of warm homes, and warm hearts.
A Britain we can all believe in.
Caroline Flint MP, Labour’s Shadow Energy and Climate Change Secretary, today launched Labour’s plan to end the scandal of cold homes. Speaking in Hastings, and building on Labour’s energy price...