Contribution
I had a segue planned in my speech that was going to get me to the hon. Gentleman’s point, but he pre-empted me, and he is quite right to do so. He is right. This is a real challenge. The switch-off is the right thing for us to do in the long term—I think that everyone agrees that as a system that is outdated—but we do need to be absolutely certain that no one is left behind.
The Minister responsible for energy consumers, my hon. Friend the Member for Peckham (Miatta Fahnbulleh), has already had a number of meetings with Ofgem and with industry to make sure we speed up the roll-out. The service ends in June, as the hon. Member for Caithness, Sutherland and Easter Ross (Jamie Stone) said, and the taskforce that has been put in place to roll it out is now moving at pace. I think it is fair to say that it should have been moving faster up to this point, but they are very aware of the issues and we will keep that under review; it is of course essential that people are not left behind when the signal is switched off.
Moving on to short-term support, we recognise that by 2030 the clean power system will be crucial to bringing down bills in the long term, and to protecting consumers from the price spikes that we have faced in recent years. However, short-term support is important for households that are struggling with their bills while we are in that transition. That is why the Government continue to deliver the warm home discount, which gives a £150 rebate off energy bills for all eligible low-income households, and it is expected to support 3 million households across the country this winter.
The Minster for energy consumers has worked with energy suppliers to agree a £500 million industry support commitment to help specific customers who are struggling this winter. We also extended the household support fund until March 2026 with an extra £742 million, with additional funding for the devolved Governments as fuel poverty is devolved through the Barnett formula.
A number of hon. Members raised the question of a social tariff. My hon. Friend the Member for Northampton South made a passionate case for it, and we are looking at what bill support could look like in the future, including the possibility of a social tariff. I acknowledge that there is a broad consensus on the idea of a social tariff. The challenge is that it means different things to different people. One of the challenges that we are grappling with is how we define a social tariff, and how we can reach, in a very targeted way, the people who need it the most.
Part of that is the issue of data sharing, which a number of hon. Members have raised—that is, how we bring together the information that the Government have about the individual people who could most benefit from such a scheme. The Minster for energy consumers is leading that work, alongside industry bodies such as Energy UK and stakeholders. They are looking at how we can improve affordability and accessibility, and they are working with the Department for Work and Pensions on how we might be able to share some of the data that it has.
The question about levies has been raised by a number of hon. Members, and I think the Conservative party is now pledging to abolish levies entirely. It is an incredibly complex subject, but it is something that we want to grapple with, and we need to be very mindful.
I return to the point made by the hon. Member for Bath at the beginning of the debate. While the wholesale price will come down as we put more renewables on to the system, and as we squeeze off gas as the marginal price, if bills do not come down because levies remain high, people will not see the benefit. It is really important to bring communities with us. The truth is, it is a complex issue. I am not going to stand here and say that we can just abolish levies, or that we can just transfer them entirely on to taxation. Neither option is possible in completion, but we are considering how we look at the future of levies, and we are open to suggestions from all parties on how we do that.
On the point about rebalancing—how we move electricity costs, in particular, on to gas—that is also a challenge. We want the number of people who use gas to decline in the coming years, as we decarbonise. The challenge will be making sure that we do not put charges on to a dwindling number of customers. Potentially and inadvertently, some of the poorest people in the country might be those who are the last to convert from gas to alternatives. I do not, for a second, dismiss the points that have been raised; they are incredibly important. However, I want to be very clear that we are working relentlessly in this Parliament on how we reduce the wholesale costs, and we want to make sure that it follows through on to consumers’ bills.
Related to that, of course, is the point about standing charges on bills, which, as many hon. Members hear from constituents, seem to be such an unfairness because they are not based on consumption or on particular customers’ circumstances. We are committed to looking at the future of standing charges. In December, Ofgem provided an update on reform. It included quite a radical proposal for introducing a new zero standing charge option under the energy price cap, which would give consumers greater choice in how they pay for their energy bills. It is for Ofgem now to consult on that proposal, which it will do this year. The driving force behind that will be making sure that any reforms are fair to all customers.
To underline that this is not straightforward and we cannot just simply abolish levies, I note that there would be unintended consequences if we were to transfer some of the costs on to other people. We could inadvertently find ourselves raising bills for some people without that being the policy intent. We are committed to reforming standing charges, but we want to do it in a way that is fair.