Rising fuel bills

MQT on 2013-12-18
Session date: 
December 18, 2013
Question By: 
Murad Qureshi
Labour Group
Asked Of: 
The Mayor


What would Londoners benefit from most, cuts to green levies that fund the war on fuel poverty or a 20-month energy price freeze?


Answer for Rising fuel bills

Answer for Rising fuel bills

Answered By: 
The Mayor

Boris Johnson (Mayor of London):  Thanks, Murad.  I would say here, just going back really to some of the answer that I gave to Jenny - she rejected my answer because she felt it did not apply to her, but it does apply to you - that I can see the upside, but the downside about the 20-month price freeze, which is I think the Labour policy, is that you do damage the ability of the energy companies to invest in supply.  Already, through the inadequacy of the preparations that have been made over the last 20 years, we face huge risks now, increased risks of blackouts and a greatly increased risk of brownouts, according to Ofgem [energy market regulator], in addition to the huge demands that we are already placing on the system.


Murad Qureshi (AM):  Thank you, Mayor, for that response.  Actually, the energy companies are getting away with green murder for not passing on the £50 green levy to customers, as has been proposed by the Coalition Government.  Only British Gas and Scottish and Southern Energy of the Big Six are going to be passing that on.  EDF Energy and E.ON have said that the Government cuts have already been taken into account when announcing their recent hikes and we still do not know about the two remaining companies of the Big Six.  Essentially, the Government has given into the blackmail of energy companies and has supported cuts to their obligation to the most vulnerable.  Do you think Londoners have a good deal in shaving £50 from our £120 increase at the expense of cutting these funds for insulating their homes?


Boris Johnson (Mayor of London):  As I was saying to Jenny, we think we can go on with the programme to insulate Londoners’ homes and we have done 99,000 so far.  We are going to do another 60,000.  We have the added attraction that the scheme now runs to 2017 rather than 2015.


The difficulty with the price freeze is that you are looking at already the construction of half of the new power plants due to contribute to Britain’s energy needs having been put on ice because of the anxiety about the possibility of Labour winning the election.  That seems to me to be the wrong way for our company to be going.  We need more power to be supplied and it is a huge mistake to be so slow with providing enough nuclear power, as I am afraid the country decided to do over the last 20 or 30 years.  We are now compounding that by very resistant to fracking.  We should get on with both options.


Murad Qureshi (AM):  Mr Mayor, you are not acknowledging the fact that the energy suppliers in the UK are run by a cartel.  They generate 70% of the energy and supply 98% of the households.  We need more competition.  I am not seeing that anything you are saying is going to increase that nationally at all.  Can I come back to the London context?


Boris Johnson (Mayor of London):  There is competition.  I am delighted you are in favour.  Generally, I thought you were in favour of nationalisation.


Murad Qureshi (AM):  There are only six.  I have just told you the examples.  I have just told you what they are doing with the £50.  They are not passing it on because they are clearly calling the shots in this context.  I just simply want to know why you will not support a policy that puts more money back into the pockets of hardworking Londoners in these tough times ‑‑


Boris Johnson (Mayor of London):  We are.


Murad Qureshi (AM):  ‑‑ as this clearly would do, with a price freeze for 20 months.  Also, [former Prime Minister, John] Mr Major’s perspective on that was actually a very worthwhile contribution.


Boris Johnson (Mayor of London):  Yes.  Let me just say in answer to Murad, who is asking about what we are doing to hold down energy costs for people in London, the crucial thing in my view is to help retrofit the homes because, as I said, the actual price of gas is by European standards comparatively low.  It is the consumption that is very high.  That is because we have inadequate retrofitting and we need to increase that.  What I am worried about is ill-thought-out measures that sound good but actually turn out to be bad for the ability of the energy companies to create the power supply that this country needs.  You are seeing already a        go-slow on the building of new power stations and that is regrettable.


Murad Qureshi (AM):  Mr Mayor, it is no consolation for those who have to choose between food and heating this winter that people in Paris or Berlin have higher bills than they have.  They just want a regular supply ‑‑


Boris Johnson (Mayor of London):  I did not say that.


Murad Qureshi (AM):  Yes, you did.  You certainly did.  Can I just be sure that you are not going to respond to the energy companies in the way Ed Davey [Secretary of State for Energy and Climate Change] has done at the Department of Energy & Climate Change (DECC) where they are clearly calling the shots, making demands and holding Londoners hostage?  For example, the proposal that Nicky [Gavron AM] suggested about the target for London has been proposed by the Environment Committee and Ed Davey has not seen fit to respond to it as an MP in Greater London.  They seem to say, “Jump”, and you say, “How high?”  It is about time you showed where you lie with Londoners on the price of energy in London.


Boris Johnson (Mayor of London):  Yes.  That is right.  It is a hard argument to make because people say, “The price is outrageous and we should stop these companies charging it”.  I do understand.  I understand why people say that.  What I worry about is the ability of these companies to make the investments they need in the supply.  You say we need more competition.  Actually, we do have a lot of competition between these companies.  If you wanted to nationalise the entire energy supply of this country, as was the case, you could control the price that way, but I do not think that even the Labour Party is currently proposing that, though that may be the next step in the Marxist progress of the ‑‑


Darren Johnson (Chair):  Thank you.  Assembly Member Dr Sahota?


Dr Dr Onkar Sahota (AM):  Mr Mayor, there is clearly a link between food poverty and excess winter deaths.  There are extensive figures, but I am looking to illustrate the point.  In Barnet, where 5.6% of London’s excess winter deaths occured and they had 5.3% of London’s households living in food poverty.  Croydon experienced 4.97% of London’s excess winter deaths and had 4.59% of London’s household fuel poverty.  In Ealing, it was 7.71% of excess winter deaths and 5.65% of London’s households living in fuel poverty.  In fact, your own Health Inequality Strategy clearly claims that fuel poverty has been associated with a significant number of avoidable winter deaths.  In 2006 and 2007, some 2,100 excess winter deaths took place in London, the majority of whom were elderly people.  What have you done in London to reduce winter deaths?


Boris Johnson (Mayor of London):  The Know Your Rights campaign has been effective and obviously our primary duty is to get people to be aware of the payments they can take up.  It is tragic how often cash that is available, even for elderly people who really need it, is not taken up.  Information is the number one priority.  We have to get the message through to people about what they are owed. 


Number two: you have to help to make their homes less wasteful of fuel and to help reduce their expenditure on fuel by retrofitting and by insulation.  That is why we are very ambitious for retrofitting in London and why I worry about what is being said about some of the housing stock in London because plainly many people on fixed incomes and elderly people will be living in some of this older housing stock that is difficult to retrofit.  We need to have a particular care to them.


Dr Onkar Sahota (AM):  To lead a healthy life, you clearly need to have enough income to support your best needs.  Staying warm in winter is a basic need.  In your Health Inequality Strategy, you committed to establish what constitutes a healthy household income, bringing together issues of child poverty, pensioner poverty and fuel poverty.  You have had almost four years to work on this.  What is the figure of the healthy household income in London?


Boris Johnson (Mayor of London):  I cannot give you that figure because I do not believe we have established it, to the best of my knowledge.


Dr Onkar Sahota (AM):  No, but you said you would establish it and you said this about four years ago.  You have not done it yet.


Boris Johnson (Mayor of London):  You must forgive me there, Onkar, because I do not have that data.  I would be very happy to go and unearth whatever it is we are meant to have done.


Dr Onkar Sahota (AM):  You made this commitment four years ago.  I am just reminding you about this.  Anyway ‑‑


Boris Johnson (Mayor of London):  Not to you, I believe.  Did I make it in this place?


Dr Onkar Sahota (AM):  You made it in your Health Inequality Strategy action plan.  You would work and extend the work of the Marmot Report [Fair Society Healthy Lives], coupled with the healthy household income, bringing together issues of child poverty, pension poverty and fuel poverty.


Boris Johnson (Mayor of London):  All right.  What we have done clearly ‑‑


Dr Onkar Sahota (AM):  I am asking what that figure is and you cannot give me that figure because you do not have it.


Boris Johnson (Mayor of London):  Obviously, the figure will vary from year to year like the London Living Wage which we raise every year. 


Dr Onkar Sahota (AM):  Mr Mayor, you do not have a figure.


Boris Johnson (Mayor of London):  I will look again at whether it is practicable to give you a figure.  What is important is the London Living Wage is currently running at £8.80.  That is a good rate for London and we are championing that and that is the thing I want to ‑‑


Dr Onkar Sahota (AM):  You also have a statutory duty in the area of health inequalities and for all your Telegraph columns extolling the virtues of New York, your record in this area is pretty shoddy, is it not?  You published your first Health Inequality Strategy three years late.  It lasted for two years.  You said you will not publish the next action plan until next year, meaning that out of eight years of your mayoralty you will have a plan for only half the time.  You cannot just answer my questions.  You duck and hide in that failure to deliver pledges to Londoners.  We know we have a part-time Mayor, but do you think it is time for a change?


Boris Johnson (Mayor of London):  Really?  Well, really?  Are you still a practising doctor or are you a full-time Assembly Member? 


Dr Onkar Sahota (AM):  Mr Mayor, I ask the questions; you answer them.  That is how it works here. 


Boris Johnson (Mayor of London):  Thank you, but, seriously, you and I, Onkar, probably share a disappointment that the Health Improvement Board was not actually given the statutory basis that we both wanted.  We are working now through the London Health Board on all sorts of ways to champion public health programmes in the city.  We are certainly looking at that.  I do not, as you know, have the budgets to do that.  The boroughs rather guard those budgets.  They are anxious about mayoral interference because, although I have some statutory responsibility for heath inequalities, I am not given the statutory powers that we should have in London.


I do not know what you mean by extolling New York.  I remind you that in New York you are about five times more likely to be murdered, for instance, than you are in London.  They have a bike hire scheme that is in no way as good as ours.  What they do have is a tradition of very interventionist public health campaigns, all of which I necessarily support.  The one on the maximum size of sugary drinks or whatever was a little bit too prescriptive, but if you look at what New York did on smoking bans it was in the lead.  You and I would agree with this.  It is regrettable that London as a city does not have the statutory wherewithal to deliver in that way.  It will come.  It is inevitable.  The mayoralty, the GLA and the Assembly will gradually take more and more of a role in that and all I can say is we are working on it.


Jennette Arnold OBE (AM):  Mr Mayor, what advice do you offer to my older and my vulnerable constituents who cannot afford to heat their homes and have a nutritious hot meal?


Boris Johnson (Mayor of London):  Most important is to help them and I am sure you are doing that, Jennette, and I will be glad to help you do that, to know what their rights are and what payments they have by right already and to make sure they are getting those payments  Obviously, if they are particularly vulnerable, to help steer in their direction the many people who can help them through one agency or another, whether provided by the boroughs or the many other neighbourhood support groups there are across London, particularly those that are actually dedicated to helping older people.  There are many voluntary groups in London, as you know, in addition to the services that are statutorily provided.


Number two: obviously, I would look at their accommodation and see whether they might benefit from any kind of retrofitting measures to improve their consumption of energy and reduce their bills.


Jennette Arnold OBE (AM):  Thank you.  Can I just pick up the first point you made about the Know Your Rights campaign?  When you launched this, I welcomed it, as did a number of Assembly Members.  Can you say why you have not been able to provide the evaluation of this work, given that I think 18 months ago Assembly Member Qureshi first asked you for any evaluation report, so that we can know where it has worked, where it has not worked and what more we need to do given the numbers of deaths you have heard of from my colleague Dr Sahota?


Boris Johnson (Mayor of London):  Yes.  You are surprising me and actually I am just looking through my notes here because I am almost 100% certain I have seen some figures for the number of people we think have benefited from the Know Your Rights campaign.  I will be very happy to get them to you.


Jennette Arnold OBE (AM):  It is 18 months outstanding.  You recently launched the Affordable Warmth and Health Action Plan.  What does that entail?  Let me tell you why I ask this.  This is an action plan that was formally launched by the London Carbon Action Network and it is a very laudable action plan.  It is a good plan.  You then made an announcement about it.  I was then surprised to read in November 2013 that - and I will just have to say their names - the Home Energy Conservation Association (HECA) stated that there has been almost incidental progress on some aspect and the only body to have formally agreed to this is the London HECA Forum.  They made no recognition of the mayoralty being involved other than to make an announcement, so I do not understand what it is you are doing with regard to this plan.


Boris Johnson (Mayor of London):  All right.  The bodies you refer to I do not know.  The acronyms you are using I do not instantly recognise.


Jennette Arnold OBE (AM):  It is their plan and you have ‑‑


Boris Johnson (Mayor of London):  Yes.  What does HECA stand for?


Jennette Arnold OBE (AM):  It is the London Network of the Home Energy Conservation Association and it is their plan.


Boris Johnson (Mayor of London):  OK.  What we are doing - and it may well chime very much with what they are saying - is we are, as I said in my first answer to you, trying to help people to know what their rights are, to know what payments are available and, secondly, to try to reduce their fuel bills by helping with retrofitting programmes.


Jennette Arnold OBE (AM):  OK.  Given we have not seen the evaluation and I go back to the numbers we know about and I go back to this being a critical issue for elders and vulnerable Londoners, do you really think you have done enough?


Boris Johnson (Mayor of London):  Obviously, this is a massive problem and you can never feel satisfied and you can never feel you have done enough when there are people who are suffering and there are people on fixed incomes who are facing very tough winters, but we think these are the things we should be doing.  I do have and I am fairly certain we have some data about the number of Londoners who have benefited from the Know Your Rights campaign and I would be very happy to share that with you.


Jennette Arnold OBE (AM):  Because I have used up my time, I can send you two classic case studies coming out of Islington, your home borough, of the plight of elders and the disabled.  I will send you those just so you absolutely get a full appreciation of just how difficult and how horrible it is out there for elders.


Boris Johnson (Mayor of London):  I would be grateful if you would send me those, Jennette.  Obviously, if there is something I can do for either of the individuals concerned, then we will try to do it.  I am sure you as their representative will already have helped them in any way you can and introduced them to all the agencies that might be able to help.  If there is anything more I can do, then obviously we will try to do it.


Jennette Arnold OBE (AM):  OK, thank you.


Darren Johnson (Chair):  Thank you very much.  Assembly Member Boff.


Andrew Boff (AM):  Mr Mayor, perhaps you could, while you are talking to Ms Arnold’s constituents, explain to them how the £50 cut in fuel bills as a result of the Coalition Government results in terrible fuel poverty, whereas the increases in electricity prices of 69% under the last Labour Government and, indeed, the gas prices that increased by 133% have had no contribution whatsoever to fuel poverty in London.  When you talk to those residents Ms Arnold has referred to you, could you advise them, on that basis, which is the best way to vote at the next election?


Boris Johnson (Mayor of London):  I would vote for the party that is going to keep the lights on and keep the supply of energy coming because, if you cannot provide the energy the country needs, then obviously the price is simply going to go higher and higher.  That is why there are some basic economics that need to be grasped by the Labour side of the argument.


Andrew Boff (AM):  Thank you.


Darren Johnson (Chair):  Thank you.  We then move on to the next question on the order paper.