Cameron under fire over fuel plans

David Cameron’s plans to rein-in soaring fuel bills were in disarray last night amid claims he has backtracked on a commitment to force energy firms to give households the cheapest deals.

The Prime Minister plunged energy policy into confusion with his surprise announcement yesterday that the Government would legislate so that gas and electricity companies “have to give the lowest tariff to their customers”.

Energy Secretary Ed Davey distanced himself from the proposal and No 10 said energy firms would be obliged only to “offer” the cheapest tariffs.

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Mr Cameron attempted to clarify his statement, but stopped short of repeating his previous suggestion.

Arriving in Brussels for an EU summit, he said he wanted to be on the side of hard-pressed people “who struggle to pay energy bills”.

“That’s what I said in the House of Commons yesterday. We are going to use the forthcoming legislation, the Energy Bill coming up this year, so we make sure, we ensure, that customers get the lowest tariffs,” he said.

Neither energy firms nor the Department for Energy and Climate Change (DECC) are thought to have had any forewarning of Mr Cameron’s announcement during Prime Minister’s Questions.

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Labour claimed the Government was defending a policy it had no intention of implementing and compared the situation to The Thick of It, the BBC’s satirical comedy of Whitehall mores.

Mr Davey delivered a speech on energy market reform to the CBI yesterday which contained no reference to the announcement.

Asked about it afterwards, he referred instead to moves previously announced by Deputy Prime Minister Nick Clegg to require energy companies to inform customers of the lowest tariffs.

“I’ve been working with the Deputy Prime Minister and others, working with the energy companies, to try to drive more competition, to get them to agree that they will tell their customers what are the best available tariffs, so customers can save money,” he said.

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Energy Minister John Hayes was hauled before the Commons to clarify the matter.

He said there were “a number of options” being considered and voluntary arrangements announced by Mr Clegg in April would be “evaluated to see if we should make the legislation binding”.

He added: “We will use the Energy Bill to get people lower tariffs and of course there are different options to be considered in the process.”

Asked whether he knew about Mr Cameron’s announcement in advance, he said: “Does he give me notice of every answer? Does he get notice of every question? Of course the answer is no.”

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Shadow Energy Secretary Caroline Flint said the Prime Minister’s statement had thrown energy policy into confusion, adding: “It caused chaos in the energy industry and I have to say it left his own ministers at a loss as to what energy policy actually is.

“For the Government to spend a day pretending they have a policy they have no intention of implementing is no way to run the country. It is like something out of The Thick of It.

A senior Labour source claimed it showed a flaw in Mr Cameron’s style of leadership.

“He does not do the detail, he does not do the hard work, and that is the reason why we have ended up in the chaotic situation we have today,” the source said.

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The Government came under fire from both sides as business leaders criticised the Prime Minister’s plan, warning that it would damage the market and put off investors, while consumer groups like Which were fearful that the idea had been ditched already and urged him to stick with it.

Comment: Page 14.