Caroline Flint MP, Labour’s Shadow Secretary of State for Energy and Climate Change, has today written to George Osborne calling for action, not another investigation, into energy bills.

The full text of the letter is below:

Rt Hon George Osborne MP
Chancellor of the Exchequer
HM Treasury
1 Horse Guards Road
London
SW1A 2HQ

7 January 2014

Dear George

Over the last five years the Government has shown that it will not stand up to the Big Six energy firms. You have stood by while bills have soared and allowed energy companies to get away with raising prices when wholesale costs increase, but not passing on reductions in wholesale costs to consumers. Yesterday Treasury sources told the press that the Government was launching an “investigation”. We do not need another investigation – we already have one and we know what the problem is. We need action.

The Competition and Markets Authority is already undertaking an investigation into the energy market. In its referral to the CMA last year, the independent regulator Ofgem specifically identified the problem of energy companies increasing their prices when wholesale costs go up, but not cutting them when costs come down. They also said that the problem had got worse since 2011, when they first identified it. Yet on both occasions the Government refused to do anything to stop consumers being ripped off.

Labour has consistently said that the regulator should have the power to force energy companies to cut their prices when wholesale costs fall. Indeed, on 18 June 2014 we tabled a motion in the House of Commons specifically calling for the energy regulator to be given new powers to force energy suppliers to pass on price cuts to consumers when wholesale costs fall, which Conservative and Liberal Democrat MPs defeated.

Government has a responsibility for setting the framework in which markets operate. Instead of kicking this problem into the long grass with another investigation, the Government must now back Labour’s plans to give the regulator the power to cut prices.

Yours sincerely,





Rt Hon Caroline Flint MP