:00:19. > :00:23.Nice and warm? The energy secretary tonight, on going green and
:00:23. > :00:27.bringing foun bills for fuels. British Gas sheer, promising to
:00:28. > :00:31.make it easier for us to reduce our energy bills, what has taken him so
:00:31. > :00:36.long. How will Britain meet its energy bills in the future. Three
:00:36. > :00:41.people who think they know are here to explain. When they protested in
:00:41. > :00:45.Bahrain, dissent was met with deadly force. Now an official
:00:45. > :00:49.inquiry for the Government of Bahrain concludes there was terror
:00:49. > :00:53.and torture. I will talk to a minister in that Government.
:00:53. > :01:03.Is greater job insecurity the way to make the economy grow faster?
:01:03. > :01:04.
:01:04. > :01:07.The Government seems to think so. So, the bad news is that we're all
:01:07. > :01:12.going to carry on paying for more our energy for years to come, the
:01:12. > :01:16.good news is by 2020, if we haven't frozen to death by then, bills
:01:16. > :01:20.could be lower by 7%. This extraordinary prediction by the
:01:20. > :01:24.energy secretary is based on his faith in things like home
:01:24. > :01:29.insulation. While we leave the boss of British Gas on a gentle simmer,
:01:29. > :01:33.we report on what the Government thinks is going to happen. Where we
:01:33. > :01:38.get our energy from, and how we pay for it is the big issue for the
:01:38. > :01:42.nation. The basic idea is out with the old
:01:42. > :01:45.energy infrastructure and in with new cleaner sources. It is
:01:45. > :01:50.complicated and potentially, politically, toxic.
:01:50. > :01:53.The price of energy in the future depends on how we prioritise,
:01:53. > :01:58.reducing carbon emission, and keeping costs down for the most
:01:58. > :02:01.needy. And how innovative we can be on energy production and efficiency.
:02:01. > :02:04.Who decides what that balance should be?
:02:04. > :02:09.Last month, David Cameron and his energy secretary, Chris Huhne, sat
:02:09. > :02:12.down in a doubleheader, with the energy companies, to try to sort it
:02:12. > :02:17.all out in a way that consumers will bie. The most important thing
:02:17. > :02:23.is to try to help people with their bills. Today Chris Huhne said the
:02:23. > :02:27.cost of energy and climate change policies will add �280 to household
:02:27. > :02:32.energy bills by 2020, but that he has a plan, including a Green Deal,
:02:32. > :02:38.that will mean bills come down. Overall be we anticipate that
:02:38. > :02:46.rising world gas prices will push up bills. But both gas and elect
:02:46. > :02:51.tristee, but the policies will moderate this rise. By 20 --
:02:51. > :02:55.electricity, but the policies will moderate the rise. But 2020 we
:02:55. > :02:58.expect bills to be 20% lower than they would have been without our
:02:58. > :03:04.policies. This is the kind of technology the Government says we
:03:04. > :03:10.will need A pilot plant to capture carbon, at London's imperial
:03:10. > :03:16.college. Essential to stay within Government emissions target,
:03:16. > :03:22.especially if we depend on gas. we look to the future and do things
:03:22. > :03:24.on larger scale, a power station, the foings to increase bills
:03:24. > :03:27.becomes more -- potential to increase bills becoming more
:03:27. > :03:30.significant. That is why it is hugely important the Government
:03:30. > :03:35.gets the investment climate right that enables us to do this in a
:03:35. > :03:38.cost effective way. To bring forward new technologies, to reduce
:03:39. > :03:41.the costs of the technologies we have got. Those more cautious about
:03:41. > :03:45.green investment, say it is all happening in a way that costs more
:03:45. > :03:49.than it should, that is why bills are going up. We know from
:03:49. > :03:52.calculation in the Department of Energy and Climate Change, that the
:03:52. > :03:57.Government's own green policies, will, by the end of the decade,
:03:57. > :04:01.have increased gas prices by a fifth, and electricity prices by a
:04:01. > :04:06.third. Those are huge increases, they don't need to be as big as
:04:06. > :04:10.that. We can go greener to lower cost. How much does going green add
:04:10. > :04:16.to bills. There have been some alarming-sounding estimates of
:04:16. > :04:20.increases of some �00 a year, aside from the Government's -- �900 a
:04:20. > :04:26.year, aside from the Government's own figures there is no true
:04:26. > :04:29.analysis of what that might be. Carbon budgets make sense from an
:04:29. > :04:35.economic perfective, there will be energy impacts but there is
:04:35. > :04:38.misconception about what the impact will be. The first misconception is
:04:38. > :04:43.energy bills are high because of low carbon, and the other is that
:04:43. > :04:46.we need huge investments and that will result in huge bills over the
:04:46. > :04:49.next decade. That is a misconception. There are growing
:04:49. > :04:54.calls for transparency on bills, to show people how much is being used
:04:54. > :05:00.to pay for what. As energy companies work on how to pass on
:05:00. > :05:03.the estimated �200 billion, it will cost them to bring out energy
:05:03. > :05:08.infrastructure up-to-date, clarity will become even more important.
:05:08. > :05:12.With us now is the energy secretary, Chris Huhne, so energy bills will
:05:12. > :05:17.be lower by 2020, this is an amazing claim? We are not saying
:05:17. > :05:21.energy bills will be lower. sounded like you were saying that.
:05:21. > :05:27.I couldn't have been clearer. could have been more clearer, you
:05:27. > :05:31.said they will be 70% lower or �94 lower. As a result of our policies,
:05:31. > :05:35.but that is not the only impact on energy bills. They will be higher
:05:35. > :05:39.in 2020? I have no control over world oil or gas prices. Why did
:05:39. > :05:43.you say it, if it is not true? Because I didn't say what is not
:05:43. > :05:47.true. I said exactly what is true. Which is we are going to have,
:05:47. > :05:56.according to the forecast from Government economists, a rise in
:05:56. > :06:03.gas prices from about 61p a thermto 70p. You said you couldn't predict
:06:03. > :06:09.what would happen to gas prices? have a low and central and high
:06:09. > :06:13.forecast. This is 70% on the average forecast? Our policies to
:06:13. > :06:20.save energy and low carbon transition, those policies will
:06:20. > :06:25.moderate what we anticipate on the central stand to take 70% off bills.
:06:25. > :06:28.It won't take 70% off bills because they will be higher in 2020?
:06:28. > :06:32.Compared with what otherwise will happen. Assuming no Government
:06:32. > :06:36.between now and 2020 did anything? If there was absolute free market,
:06:36. > :06:39.and you simply had reflecting what was happening in the world in the
:06:39. > :06:44.gas market, and the world oil market, then you would see a rise
:06:44. > :06:49.in energy bills over the period of 2020. We don't have a free market,
:06:49. > :06:55.do we? We have one worldwide. in this country, we don't? If we
:06:55. > :07:00.have to buy gas from Norway or Qatar, they are not the Salvation
:07:00. > :07:04.Army. It is an entirely bogus at that time tis snik No. Since you
:07:04. > :07:08.have admitted you can't predict price, and no Government can do
:07:08. > :07:13.anything between now and 2020? not saying we can't predict energy
:07:13. > :07:17.prices, we have three different scenarios. Last month you said you
:07:17. > :07:21.couldn't predict energy prices? key point is the things that I can
:07:21. > :07:25.control, that the Government can control, which is our policies, are
:07:25. > :07:30.going to moderate the impact of energy bills. That is the key point.
:07:30. > :07:34.But if, in the absence of policies, we're going to see a rise in bills,
:07:34. > :07:38.the effect of our energy-saving policies and our transition to low
:07:38. > :07:43.carbon, getting off the fossil fuel hook, away from the vulnerability
:07:43. > :07:48.to the Middle East, that clut bills by 27%, and indeed our bills
:07:48. > :07:52.throughout -- cut bills by 27%, and indeed our bills throughout the
:07:52. > :07:55.parliament. How much do tax-payers have to pay to meet the target?
:07:55. > :08:00.Tax-payers don't pay anything, it is, in effect, through bills. There
:08:00. > :08:07.is an increase in the unit cost of gas and electricity, pointed out in
:08:07. > :08:13.the package. There are also benefit that is flow from that, we consume
:08:13. > :08:18.less energy and the cost comes down. No increase in green taxes? We have
:08:18. > :08:22.increased the green -- reed the green taxes. Between now and 2020
:08:22. > :08:26.and this wonderful day when bills are 70% lower there is no increase
:08:26. > :08:30.in green taxes? You have two effects going on, you are
:08:30. > :08:33.increasing the unit cost of gas and electricity, and you are increasing
:08:33. > :08:37.the charges across the unit. As a result of the savings that you are
:08:37. > :08:43.making, in the amount. People will have to pay for more their bills?
:08:43. > :08:46.No. You have just said as much, haven't you? No, because the price
:08:47. > :08:52.and amount equates to the bill. If the amount comes down more than the
:08:52. > :08:56.price goes up, the bill comes down. It is quite simple. I have no idea
:08:56. > :09:00.what you are talking about. When you get your energy bill, it is
:09:00. > :09:03.made up not just the price of the unit of gas and electricity, but
:09:03. > :09:08.also the amount you use. If you reduce the amount you use by more
:09:08. > :09:11.than the price goesp, the impact of that is to reduce the bill. That is
:09:11. > :09:15.what is going on as a result of policy. That is clear if you don't
:09:15. > :09:18.use any electricity at all, you don't pay any electricity bill?
:09:18. > :09:23.That is also true, but that is not what I'm saying. We are
:09:23. > :09:27.anticipating that we will go on using a very substantial amount of
:09:27. > :09:30.both gas and electricity, but we will save the amount we will use
:09:30. > :09:36.compared with at the moment, and we will have a transition so
:09:36. > :09:42.increasingly, as we move on to non- fossil fuel forms of energy. We
:09:42. > :09:46.won't get buffeted by the events we have seen in the last year, we have
:09:46. > :09:55.had a 58% increase in gas prices because of what is happening in the
:09:55. > :10:01.Middle East and the Fukashima disaster and if we move away from
:10:01. > :10:06.that thal be good for the British consumer and jobs. Let me ask you a
:10:06. > :10:09.straight forward question, the �200 million investment in the
:10:09. > :10:13.infrastructure, who pays for that? That is factored in the base line
:10:13. > :10:16.of the energy bills. We are assuming the energy companies will
:10:16. > :10:20.have to make a return on the capital. We are assuming an
:10:20. > :10:23.increase in world prices, we're also giving a separate calculation,
:10:23. > :10:33.that is a calculation of the effect of our policies and that is what is
:10:33. > :10:34.
:10:34. > :10:41.reducing bills by 2020. Despite the �200 billion spent on the
:10:41. > :10:46.infrastruck tue, paid by consume -- infrastructure paid for by
:10:46. > :10:50.consumers' bills? Not up front, you do it the same as any other
:10:50. > :10:53.investment, it is over the life of the investment. If it is �200
:10:53. > :10:58.billion, it is not straight away, it is over the lifetime of that, in
:10:58. > :11:01.the same way as a mortgage, and other ways you fund that investment
:11:01. > :11:04.over the lifetime of the investment. Thank you very much.
:11:04. > :11:08.Of course, reducing your bill something you can only do if you
:11:08. > :11:12.understand how the bill is calculated. The energy companies
:11:12. > :11:21.have produced such a baffling array of different tarrifs that figuring
:11:21. > :11:27.out which one is best would have beaten the brains of Newton and
:11:27. > :11:33.Leibniz. Before we talk to the boss of British Gas here is this report.
:11:34. > :11:39.As we all pay more at home for energy and gas, events far away
:11:40. > :11:45.seem far away. The earthquake in March in Japan meant shocking gas
:11:45. > :11:53.prices too as the country shut down nuclear power plants and turbd to
:11:53. > :11:58.gas, events in Libya, and the price from gas-fired powertations has
:11:58. > :12:03.risen too. The prices are buffeted by
:12:03. > :12:07.political turmoil, by natural disasters, but is the price we pay
:12:07. > :12:12.really beyond the control of politicians and energy companies
:12:12. > :12:16.here? Or is our energy market simply not working? I think we have
:12:16. > :12:19.a number of big problems in the energy market, the first is
:12:19. > :12:22.consumers believe very little the energy companies say. The second is
:12:22. > :12:26.we are in an environment where prices are going up, that is
:12:26. > :12:35.causing consumers to be fearful of winter weathers. We still haven't
:12:35. > :12:39.got the A, B, Cs of a proper market sorted out. The tarrifs are
:12:39. > :12:45.confusing and people are being driven into energy debt by high
:12:45. > :12:48.prices, there is a lot to be sorted out. We know customers are
:12:48. > :12:53.frustrated. British Gas want us to believe that new technology will
:12:53. > :12:57.help us cut back. These smart metres show you the energy you are
:12:57. > :13:00.using. Customers will understand their energy ue, pounds and pence,
:13:01. > :13:06.gas and electricity, it means they have choice about what to do
:13:06. > :13:10.differently to save money on energy bills. Recent price rises by the
:13:10. > :13:15.big energy companies have been dramatic, 16-18% for gas, and 10%
:13:15. > :13:20.for electricity. How closely do energy bills track the wholesale
:13:20. > :13:25.prices. Until the end of 2008, they tracked pretty closely, but after
:13:25. > :13:31.that point, when wholesale prices fell, to a low last summer, our
:13:31. > :13:35.bills stayed relatively flat. That tracking was less obvious. In the
:13:35. > :13:40.1990s, we had managed to create quite a successful market, which
:13:40. > :13:44.really did drive down energy prices for everybody. That was a success
:13:44. > :13:49.that people emulated around the world. Since then Governments have
:13:49. > :13:52.interfered in markets in all kinds of ways. Growing fury over the
:13:52. > :14:02.bills has pushed energy companies to say they are changing their ways,
:14:02. > :14:36.
:14:36. > :14:42.The latest upset has been over profits. Energy companies ds
:14:42. > :14:48.dispute the figures, but last month Ofgem said margins for an average
:14:48. > :14:53.household had reached �125 a year, up from �pun 15 in June. Warm words
:14:53. > :14:56.-- �15 in June. Warm words may not be enough. With us is the managing
:14:56. > :15:00.director of British Gas, Phil Bentley, why do you think people
:15:00. > :15:06.have lost trust in you? They definitely v one of the issues is
:15:06. > :15:10.the number of tarrifs out there. There is 544 tarrifs to choose from.
:15:10. > :15:14.When millions of people at home are looking at the energy bill, they
:15:14. > :15:19.don't understand it, and where they can save money, as an industry we
:15:19. > :15:23.have to put our hands up and say we should be doing more to help.
:15:23. > :15:27.you wake up one morning and think we have too many tarrifs, what
:15:27. > :15:31.happened? We are announcing a big change tomorrow. I'm asking when
:15:31. > :15:35.you realised? It has been building, and for two reasons. You have done
:15:35. > :15:39.this because you have been told to do it, haven't you? Ofgem have told
:15:39. > :15:45.you to do it? If I can give you the reasons why. The world is changing,
:15:45. > :15:48.the world is changing because the UK, today, is importing 50% of the
:15:49. > :15:54.gas it needs from international markets. I know you don't want to
:15:54. > :15:59.really hear this point, let me make one point if I could. A tanker
:15:59. > :16:06.landed in Britain, for the gas for 100 though homes in Britain, it
:16:06. > :16:11.cost �42 million. That same tanker can sail to Japan and they will pay
:16:11. > :16:16.�62 million for it. I'm asking about why you developed so many
:16:16. > :16:20.different tarrifs in your industry, and why you have now decided,
:16:20. > :16:25.suddenly, you weren't playing fair with the consumers? Consumers are
:16:25. > :16:30.told us they don't like it. It is right we respond. Which is why, if
:16:30. > :16:34.I may, we are simplifying tarrifs, and ensuring fixed or variable,
:16:34. > :16:39.simple. Would you like to apologise for the complexity of the tarrifs?
:16:39. > :16:43.I would, I would say to all viewers we have not made it easy. Let me
:16:43. > :16:47.refer you to this graph I will put up on the wall behind me now, I
:16:47. > :16:50.hope. Would you like to apologise to them for what has happened to
:16:50. > :16:54.their bills, when you see the wholesale price of energy has gone
:16:54. > :16:57.down, and bills have not gone down? Again, you have to have this honest
:16:57. > :17:02.conversation, what's the cost of green, what's the cost of delivery
:17:02. > :17:06.to your home, and the cost of energy that goes into it. You keep
:17:06. > :17:10.saying the bills go up, you have just told us, just now, that world
:17:10. > :17:14.market prices have gone up and that is why bills have gone up. That
:17:14. > :17:20.graph proves you are not being entirely honest the wholesale cost
:17:20. > :17:24.has gone down and bills have not? Our margins are 5% a year. 5%, let
:17:25. > :17:28.me just finish the point. That graph demonstrates, comprehensively,
:17:28. > :17:32.that is a partial picture? It is a partial picture, because it doesn't
:17:32. > :17:36.include, all the other things that are in your bill. The cost of green
:17:36. > :17:41.energy. How much is it in your bill, it will be �50 next year, that is a
:17:41. > :17:46.policy decision. Transporting it through The Grid, the cost of that
:17:46. > :17:52.is going up. Within that �200 billion that Chris Huhne is talking
:17:52. > :18:00.about, we have to reinforce The Grid. That isn't to do with green
:18:00. > :18:04.measure, that is the wholesale cost of energy. Wholesale costs have
:18:04. > :18:08.gone down and bills haven't? If you look over a longer period of time,
:18:08. > :18:11.you will see the wholesale price of gas has gone up. Nobody denies that.
:18:11. > :18:16.But all I'm trying to say is that the wholesale price of gas is not
:18:16. > :18:20.the only part of the bill. It is the whole point about simplifying
:18:20. > :18:25.tarrifs, giving customers choice, giving them transparency, what is
:18:25. > :18:29.in your bill, how much is the commodity, has it gone up or down.
:18:29. > :18:33.How much is transportation and green lefies, that is what we are
:18:33. > :18:38.trying to do for our customers, that will be welcome. In that
:18:38. > :18:41.process you can lay some of it off on people like Chris Huhne, who has
:18:41. > :18:45.left the studio. Do you consider, when you look at your company, do
:18:45. > :18:49.you think you are just like any other company. Utilities, many
:18:49. > :18:59.people feel, are not like other companies, not like a fashion chain
:18:59. > :19:05.or a brewery? We offer an essential requirement to living in part of
:19:05. > :19:07.the world. We are conscious of our -- in any part of the world. We are
:19:07. > :19:11.conscious of our social responsibility. Our first priority
:19:11. > :19:14.is to help those who can't afford the heating bills. Then we have to
:19:14. > :19:21.make sure we have the energy that Britain needs over the next ten
:19:21. > :19:25.years. We signed a deal this week, �13 billion to bring gas to the UK,
:19:26. > :19:28.for three-and-a-half million homes for ten years. That is where our 5%
:19:28. > :19:34.margins go. What is an acceptable profit, do
:19:34. > :19:39.you think, for a utility company? said 5% is what we believe is right
:19:39. > :19:45.for the investments that we're having to make. So when it has been
:19:46. > :19:49.up at%, that has been morally wrong? If you look at that, that is
:19:49. > :19:52.when it has been very cold. were responsible for that? No, but
:19:52. > :19:56.we clearly sell more energy when it is cold, and when it's warm, which
:19:56. > :20:01.it is now, and it is great that it is. Bills are actually lower this
:20:01. > :20:07.year. You took the margin, didn't you? You took the margin? We have
:20:07. > :20:12.fixed costs we pass on the benefits to customers. You have told us 5%
:20:12. > :20:17.is an acceptable profit, and you were taking, by your own admission,
:20:17. > :20:21.9%? It will be lower in the year we sell less gas. As you have conceded
:20:21. > :20:26.you don't control the weather it is a meaningless stpaiplt? We don't
:20:26. > :20:31.control the price of -- Statement? We don't control the price of gas
:20:31. > :20:35.either. We are in an international market. What is important is
:20:35. > :20:40.customers understanding the tarrifs. We want to help and simplify, and
:20:40. > :20:45.the second is, can they use less energy, that is where energy
:20:45. > :20:49.efficiency can make a difference. We have Ann Robinson from the
:20:49. > :20:55.consumer group uSwitch, the founder and managing director of Ovo Energy,
:20:55. > :20:58.Stephen Fitzpatrick is here, and Liz Hutchins from the environmental
:20:58. > :21:03.charity, Friends of the Earth. Are you reassured by all of this?
:21:03. > :21:08.completely. The answer to your first question, Jeremy, about trust,
:21:08. > :21:16.consumers have seen their bills go up by 21% this year. Two increases
:21:16. > :21:22.in a year. Our last customer survey, which we have just done, shows that
:21:22. > :21:26.consumers' overall satisfaction has gone down from 70% to just over 60%,
:21:26. > :21:31.for only four in ten believe they are on the best deal for them. That
:21:31. > :21:34.is why they are not trusting energy companies. Until we have absolute
:21:34. > :21:38.transparency and fairness, and we understand what is going on, we're
:21:38. > :21:42.not in a position to judge whether we have been treated fairly. This
:21:42. > :21:45.letter that British Gas is sending out. You personally signed it, this
:21:45. > :21:49.letter to all your customers about a called honest conversation, do
:21:49. > :21:53.you feel they have behaved honestly? It is very difficult to
:21:53. > :21:58.make the judgment about whether they behaved honestly or not. The
:21:58. > :22:03.problem with the energy companies, they have the wholesale and
:22:03. > :22:08.retailers, one bit is the other bit any way. We haven't absolute
:22:08. > :22:14.clarity about what they paid for their energy. Most energy companies
:22:14. > :22:18.buy their energy four or five years in advance. They can't trust you?
:22:18. > :22:23.agree with that point, that is why we have to do something about it.
:22:23. > :22:28.Why don't they trust us? Too many tarrifs. Number two, when customers
:22:28. > :22:32.are paying more than they should, the energy companies haven't
:22:32. > :22:36.written to them, but we are writing to customers and saying you could
:22:36. > :22:40.be on a better deal. And thirdly, we will explain your bill, how much
:22:40. > :22:45.is the energy, how much we paid for it, and how much is the green.
:22:45. > :22:49.me say right now, right now there are a lot of people out there, a
:22:49. > :22:55.lot, probably the majority, scared stiff about their energy bills this
:22:55. > :23:00.winter. 21%. They have seen inflation going up 4-5%. They don't
:23:00. > :23:10.understand why they are having do this. Secondly, last winter,
:23:10. > :23:11.
:23:11. > :23:16.eventhough it was a cold winter, 20% of people turned their engeooff
:23:16. > :23:21.-- energy off, it is a major problem in Britain. People in
:23:21. > :23:24.Britain should not have to make a choice between heating and some
:23:24. > :23:29.other essential good. That is why there is winter fuel prime
:23:29. > :23:35.ministers and warm discount. Nobody should be faced with that decision.
:23:35. > :23:40.I'm determined that that, Jeremy, and Anne knows this, we helped a
:23:40. > :23:44.million customers last year with their bills. I want to look at the
:23:44. > :23:50.specific aspect of competition, the market is dominated by six major
:23:50. > :23:56.suppliers, you are a very small supplier? Quite small. I don't mean
:23:56. > :24:00.to insult you! What is stopping you going places faster? We have
:24:00. > :24:04.doubled in size in the last six months. We are not exactly slow
:24:04. > :24:09.when it comes to growing, we are punching above our weight and
:24:09. > :24:13.delivering good value for money for customers. One of the things I find
:24:13. > :24:16.personally, we have been working with Jeff gem and ministers and
:24:16. > :24:19.consumer groups to raise the bar in terms of customer expectations is
:24:19. > :24:27.the level of confusion. We have tacked about it already tonight, it
:24:27. > :24:32.is so easy. We launched two years ago. These guys shut you out?
:24:32. > :24:35.getting on to that. Get a move on? The fact of the matter is that we
:24:35. > :24:40.see not only a huge range of tarrifs, but a huge range of
:24:40. > :24:46.different prices, from ones that look like the customer has been
:24:46. > :24:50.overcharged, and other customers who are clearly paying below market
:24:50. > :24:54.costs as loss leaders. We see it across the industries, and all the
:24:54. > :24:58.big six to varying degrees have exercised this practice. We agree
:24:58. > :25:03.with you, we have to stop that, be absolutely transparent about the
:25:03. > :25:08.tarrif, if there is a better deal we will tell our customers.
:25:08. > :25:13.want more competition? We welcome it, we have new entrants, we have
:25:13. > :25:17.smart metres, it keeps us on our toes, we are never shy from xeegt.
:25:17. > :25:22.We have grown to be the largest supplier -- competing, we have
:25:22. > :25:26.grown to be the largest splair of energy. You sat there patiently, by
:25:26. > :25:30.how much are energy bills going to increase with the cost of going
:25:30. > :25:37.green? The real big cost on energy bills, as has been said, actually
:25:37. > :25:42.is gas. It is the huge cost that we pay for rocketing gas prices,
:25:42. > :25:45.internationally, that's the main driver. The other factor is this
:25:45. > :25:49.monopoly that the big six energy companies have. They are holding us
:25:49. > :25:54.over a barrel on prices, frankly, yes we should switch between energy
:25:54. > :25:59.companies, but that won't solve the problem, we need to break open this
:25:59. > :26:03.monopoly, and stop people like Phil having the superprofit.
:26:03. > :26:09.dominant companies is not a monopoly, it may be a cartel, but
:26:09. > :26:13.not a monopoly. The problem is they shut out competition? They do I
:26:13. > :26:17.think Ofgem, the regulators, the department for climate change, the
:26:17. > :26:22.ministers in charge, people are starting to see the effects that
:26:22. > :26:25.loss leaders have on competition. When a commodity with gas and
:26:25. > :26:29.electricity, there is a tight operation. It is the lowest cost of
:26:29. > :26:33.service for all the energy companies, where we see larger
:26:33. > :26:38.energy companies using profits from older customer, 5% of the people
:26:38. > :26:43.consuesed by the market and not changing. When they subsidise loss
:26:43. > :26:49.leaders and price us out of the market is takes the spirit of
:26:49. > :26:53.competition. You agree you are doing that? On-line was sold as a
:26:53. > :26:57.loss leader. That isn't right. We are not doing that. It will be cost
:26:57. > :27:03.effective, and it is about being straight with our customers, simple
:27:03. > :27:05.choices of tarrifs. It is not right if we're charging our loyal
:27:05. > :27:10.customers more, and they aren't getting the special deal, that
:27:10. > :27:13.isn't right either. That is why we are writing in the letter saying if
:27:13. > :27:18.there is a better tarrif for you, we will tell you. Do you really
:27:18. > :27:25.expect the 85% of people already having switched to take your letter
:27:25. > :27:29.up and say today's the day I will do it. Shouldn't you just level the
:27:30. > :27:34.prices so energy customers don't have to. We sat in the room with
:27:34. > :27:40.Chris Huhne and David Cameron, we tacked about sending eight million
:27:40. > :27:44.letters to customers to say they could be paying less, the obvious
:27:44. > :27:48.answer is to charge them less. everyone wants to be on an on-line
:27:48. > :27:53.tarrif, my mum wants a simple tarrif paid quarterly. It will be
:27:53. > :27:58.really important to get competition going amongst those 85% who aren't
:27:58. > :28:00.switching. I'm very much in favour of the market. I think the market's
:28:00. > :28:04.right. At the moment we are sleepwalking our way to more
:28:04. > :28:08.regulation. To be honest, if we find that, for example, switching
:28:08. > :28:13.it drops even further, and it could do over the next year or so because
:28:13. > :28:16.of what is happening, then it wouldn't surprise me if Ofgem come
:28:16. > :28:19.and decide to introduce price regulation, that is more
:28:19. > :28:24.interference in the market. What is best for consumers is an active
:28:24. > :28:29.market, and us engaging, what we have to do is get the engagment.
:28:29. > :28:34.You don't believe the market works at all? I think it is a disSAS te,
:28:34. > :28:37.I think your take home pay of �1.9 million last year, at a time when
:28:37. > :28:43.one in four households are living in fuel poverty is a disgrace.
:28:43. > :28:47.People will wonder, when is the Government going to act to break up
:28:47. > :28:57.this big six dominating the whole situation. We do have competition,
:28:57. > :28:57.
:28:57. > :29:01.British Gas looks after half the homes in Britain. Ofgem said last
:29:01. > :29:04.winter British Gas overcharged customers to the tune of �250
:29:04. > :29:08.million is what Ofgem said you ripped people off. You are saying
:29:08. > :29:11.you are fair with customers and will give them more choice, we need
:29:11. > :29:15.to break open this system and completely reform it, to make it
:29:15. > :29:20.fit for purpose, for the future. The only point I would make is it
:29:20. > :29:25.is an international market. We have the cheapest gas prices in Europe.
:29:25. > :29:29.You can't deny that point. We need to move away from gas. If you
:29:29. > :29:36.believed in competition, wouldn't you sell more of your gas on the
:29:36. > :29:40.open market? We produce gas and sell it on the open market.
:29:40. > :29:44.Companies do buy T that is not the issue. We are having to buy. We pay
:29:44. > :29:49.similar prices for the gas, I'm sure you are paying what I'm paying
:29:49. > :29:51.for gas. The point is prices are going up, for so long we have heard
:29:51. > :29:55.energy companies talking about investment, and the requirement for
:29:55. > :30:01.green investment gas price, going up the global market. It doesn't
:30:01. > :30:07.take away from the fact that energy companies haven't been treating
:30:07. > :30:13.customers fairly whatever the prices. Whether prices are going up
:30:13. > :30:16.we should be simplifying tarrifs and bills. Your move is great step.
:30:16. > :30:21.That is what we are doing. surprising thing happened today in
:30:21. > :30:25.the gulf, in par rain, which last been ruled by the same -- Bahrain,
:30:25. > :30:30.which has been ruled by the same family for many years. An
:30:30. > :30:35.independent investigation into protests there was read out. It was
:30:35. > :30:40.said the police used fear and torture against open pen nents, and
:30:40. > :30:48.special courts set up to deal with people denied them justice.
:30:48. > :30:52.Contrary to other claims the uprisings were home-grown and not
:30:52. > :30:55.incited by Iran. Bahrain, just south of the capital, Shia
:30:55. > :30:59.protestors are on the streets venting their anger. Their cause is
:30:59. > :31:04.redoubled by the report, commissioned by the king, which
:31:04. > :31:08.spells out the brutality of the king's own men. There could be no
:31:08. > :31:13.denying what the world had already seen. The security forces shooting
:31:13. > :31:20.down demonstrators last spring, but the commission also confirms what
:31:20. > :31:24.has been happening off camera. Torture in all its awful varieties.
:31:24. > :31:30.TRANSLATION: Severe beating, use of water pipe and wooden and metal
:31:30. > :31:37.batons and other forms of torture, and elect cushion. To expose the
:31:37. > :31:41.detainees to high levels of temperatures. Threats of rape and
:31:41. > :31:44.humiliation of religious sects. arrived in Bahrain in February, on
:31:44. > :31:48.the day they were burying of the first of the mourners to die,
:31:48. > :31:51.protesting at the Government. Within hours security forces had
:31:51. > :31:57.opened fire on the funeral prosession, killing another man.
:31:57. > :32:07.Yet the Government, the Royal Family, seemed Blythly ignorant of
:32:07. > :32:07.
:32:07. > :32:11.the Israel -- blythly ignorant of the threat, they blamed Iran for
:32:11. > :32:16.stirring up the uprising. The report says that is nonsense. There
:32:16. > :32:22.was no Iranian hand the trouble lies within Bahrain's own trouble
:32:22. > :32:27.fault line. Even the police, condemned for excessive force are
:32:27. > :32:33.Sunni, imported from Yemen. The king has promised Bahrain will open
:32:33. > :32:38.a new page in history, and he will sack earnt officials. Many are
:32:38. > :32:43.unconvinced, the Government which says that torture wasn't Government
:32:43. > :32:52.policy, has, at best, allowed Security Services to run out of
:32:52. > :32:58.control. Medical staff were treated as traitors to treating the wounded,
:32:58. > :33:03.and jailed. There will be retrials. But a doctor today told us people
:33:03. > :33:06.are still dying. They were talking about torture and people in prisons
:33:06. > :33:11.stopping, but today torture, people beaten in the streets in their
:33:11. > :33:15.houses and running over them and killing them is still on going.
:33:15. > :33:20.Today just one person died. deaths, five people tortured to
:33:20. > :33:25.death, hundreds wounded, 1600 arrested. Bahrain had to come out
:33:25. > :33:27.with this report, because America, which supplies its arms, demanded a
:33:27. > :33:32.full account. Bahrain's neighbour, Saudi, will
:33:32. > :33:37.not be so impressed. They had urged Bahrain to crack down on the Shia,
:33:37. > :33:42.they won't like any hints of weakening.
:33:42. > :33:45.I'm joined in the studio by Bahrain's Minister of Cabinet
:33:45. > :33:52.Affairs. Did you know your security forces
:33:52. > :33:56.were this brutal? As the report issued today found that there are
:33:56. > :34:00.mistakes made in the past, and it has been done and we accept the
:34:00. > :34:04.report. The lesson has been learned, the most important thing is to fix
:34:04. > :34:07.things and go forward with the country. We need to unite the
:34:07. > :34:11.people and actually if the report is doing something, it is saying,
:34:12. > :34:15.it is confirming what we have said at the beginning, we want the truth
:34:15. > :34:19.even if that means it is against the Government. Blindfolding,
:34:19. > :34:27.handcuffing, enforced standing for long periods, beating, punching,
:34:27. > :34:33.hitting with wooden planks, pipes, sleep depravation, elect cushion,
:34:33. > :34:43.and numerous others, these came as a complete surprise for you?
:34:43. > :34:54.
:34:54. > :34:58.have to make sure the report is A show of how the imaginationry and
:34:58. > :35:02.the Government has dealt with the situation. We can't tolerate
:35:02. > :35:05.violence and the torture. It was clearly systematic? Action has to
:35:05. > :35:13.be taken. What action will be taken? I think
:35:13. > :35:17.we have already started the reform. 20 officers have been prosecuted
:35:17. > :35:19.for mistreatment that led to death, as well as we are working with
:35:19. > :35:23.allies and the international organisations to change the system
:35:23. > :35:27.and the process. We need to implement reform to improve the
:35:27. > :35:31.country and to move forward. you saying you are committed to
:35:31. > :35:35.becoming a proper democracy? think Bahrain has started the
:35:35. > :35:40.political reform ten years ago. It was unprecedented at the time. I
:35:40. > :35:50.have to remind you until recently that Bahrain was viewed by leading
:35:50. > :36:00.democracies as the poster child for reform. Who gave you your job? The
:36:00. > :36:05.king gave your job? There was not using that as a model of reform.
:36:05. > :36:12.Committed to a proper democracy? course, we have laid down a
:36:12. > :36:15.foundation of a progressive no democracy. By when? The people of
:36:15. > :36:22.Bahrain should decide how we will progress. Unfortunately they have
:36:22. > :36:29.to wait on the king's say so, when does he want Bahrain to become a
:36:29. > :36:34.democracy? We have established the institutional, the institutions. We
:36:34. > :36:39.need to expedite the reforms and meet the demands of our people.
:36:39. > :36:46.you now we great inviting the Saudis in to help you put down the
:36:46. > :36:54.protests? I think the agreement with us, the report confirmed today
:36:54. > :36:58.that they have not engaged or contacted with the protestors. They
:36:58. > :37:03.have been located in a critical site away from the protests.
:37:03. > :37:07.don't regret inviting them?? think Bahrain and the other
:37:07. > :37:12.countries, we work to enhance our relationships, and integrate
:37:12. > :37:16.ourselves, and there is agreement to allow us to do this.Would
:37:16. > :37:20.have published this report had it not been pressure from the
:37:20. > :37:23.Americans? We did the best because we want the best for our country,
:37:23. > :37:26.we want to move forward. What happened did not benefit anyone in
:37:26. > :37:31.Bahrain. Not even the countries that want the stability in the
:37:31. > :37:35.region. It had nothing to do with an arms deal? We want to move
:37:35. > :37:39.forward and unite the people in Bahrain. What has happened is we
:37:40. > :37:45.have a social division today, it has polarised the country. We have
:37:45. > :37:51.two significant sections in Bahrain, we need to build the trust again.
:37:51. > :37:54.Unless we start a reconciliation process and reform we will not move
:37:54. > :38:02.forward. Everybody in Bahrain has to work together for the good of
:38:02. > :38:05.If you set out to seek a punch-up with the trade unions, you couldn't
:38:05. > :38:08.have done better than the set of business ideas Vincent Cable came
:38:08. > :38:12.up with today. In order to breathe life into the economy he wants to
:38:12. > :38:17.make it easier for employers to get rid of staff, without fear of
:38:17. > :38:20.facing an employment tribal. He says's -- tribunal, he says he's
:38:20. > :38:22.chopping away at restriction that is inhibit growth. We will talk
:38:22. > :38:26.about it in a moment. First this report.
:38:27. > :38:31.In the office of the business secretary, it is called a radical
:38:31. > :38:37.reform of employment relations. Vincent Cable says, in future it
:38:37. > :38:43.will be harder to take your boss to a tribunal.
:38:43. > :38:46.All claimants will be obliged to submit their complaints at ACAS, so
:38:46. > :38:52.parties can try to resolve the dispute through reconciliation
:38:52. > :38:56.before being taken to a tribunal. There will be an alternative, a sor
:38:56. > :39:01.far undefined rapid resolution scheme, and employers will be able
:39:01. > :39:06.to have a candid chat of an underperforming employee without it
:39:06. > :39:10.being used in evidence against them. We are starting a scheme of
:39:10. > :39:13.protected conversation, it allows employers to raise issues, such as
:39:13. > :39:19.poor performance, and retirement plans in an open way. You are not
:39:19. > :39:24.performing as I want you to perform. I'm performing as I want it me to
:39:24. > :39:28.perform, it is a good performance, let's agree to disagree. Maybe not
:39:28. > :39:32.like that. Number Ten canvased a venture capitalist, Adrian Beecroft,
:39:32. > :39:37.for ideas, he said employers should be free to fire at will, Liberal
:39:37. > :39:42.Democrats shredded that idea. Might it have been a policy aunt Sally,
:39:42. > :39:48.op pro posed by ministers to be knocked down so what followed would
:39:48. > :39:58.be looking better. There is a lot of tri-ainglaigs going on, you put
:39:58. > :40:01.
:40:01. > :40:09.out a -- Triangle laigs going on, you will have to have some sort of
:40:09. > :40:17.policy mix to see British GDP rising. You need to be radical and
:40:17. > :40:21.bold and take steps now that perhaps two or three years ago
:40:21. > :40:26.would have been contemplate. It is not hard to spot the business
:40:27. > :40:31.secretary's lack of enthusiasm. are seeking views on a proposal to
:40:31. > :40:36.seek no fault dismissal for microfirms. That is those with ten
:40:36. > :40:46.or fewer employees, I stress we are seeking evidence on both sides.
:40:46. > :40:47.
:40:47. > :40:50.That would sour relationships between employers and employees. I
:40:50. > :40:53.don't think the fundamental right they have at the moment which is no
:40:53. > :40:58.know why they are being dismissed. Of course we have to wait and see.
:40:58. > :41:01.I mustn't presuppose what the call for evidence brings. But I will be
:41:01. > :41:07.surprised if it was found that would be good for business.
:41:07. > :41:12.You were an employer before you entered parliament, did you find
:41:12. > :41:18.employment law a barrier to recruiting staff? No. Vincent Cable
:41:18. > :41:21.made much the same point in his own speech. He prefaced his own
:41:21. > :41:26.proposals by point to go a survey conducted by his department, in
:41:26. > :41:31.which those running small and medium-sized businesss were asked,
:41:31. > :41:35.what is the biggest obstacle to business success. Those citing
:41:35. > :41:38.business regulation and employment rules was 6%. What is really
:41:38. > :41:43.stopping businesses hiring is growth or lack of it. Today's
:41:43. > :41:47.announcement and those between now and next Tuesday, when George
:41:47. > :41:52.Osborne delivers his autumn statement, are intended to give the
:41:52. > :41:56.look of an active Government, pushing every lever, pressing every
:41:56. > :42:01.button to get the engine running. Are these announcements enough.
:42:01. > :42:04.These employment measures are helpful by very modest. People
:42:04. > :42:10.won't think that is the decisive thing, it helps, but they want
:42:10. > :42:16.other things to be true as well. We need a whole range of measures,
:42:16. > :42:19.people want the promise of more demand. If these workers fear
:42:19. > :42:24.losing their jobs they are reluctant to spend. If ministers
:42:24. > :42:30.fail to get the economy growing, there is one group of employers who
:42:30. > :42:35.can hire and fire at will, the voters. With me now is economist,
:42:35. > :42:41.Ann Pettifor, and venture capitalist, Jon Moulton S this
:42:41. > :42:45.salvation? I fear not. It is salvation deferred. It is action in
:42:45. > :42:49.due course, possibly up to three years forward, it is not a lot,
:42:49. > :42:52.really. What do you think of it? just think it is looking for
:42:52. > :43:00.scapegoats, and you know, there is a big elephant in the room, which
:43:00. > :43:04.is that confidence collapsing, the stock market in free fall. There is
:43:04. > :43:09.real problems out there. We are talking about fiddling, why the
:43:09. > :43:17.economy burns. This is completely fatuous? Absolutely. You obviously
:43:17. > :43:20.both agree for different reasons? So does Vincent Cable. I can have a
:43:20. > :43:26.modest disagreement, there is some benefit in making it easier to
:43:26. > :43:30.employ people. It won't solve the economy in one go, at least a few
:43:30. > :43:34.deserving souls will get jobs and undeserving souls will lose them.
:43:34. > :43:38.We are the least regulated in the whole of Europe. If we look at
:43:38. > :43:41.comparators, Germany, Sweden, in terms of regulation. We find in
:43:41. > :43:45.Germany they have twice as much protection for their work force,
:43:45. > :43:50.and they don't have the unemployment problems we have. They
:43:50. > :43:57.don't have the growth problems we have. They have more protection for
:43:57. > :44:02.their work force. They grow more. You are claiming cause and effect?
:44:02. > :44:05.I'm saying it is not the point. Vincent Cable is saying the same
:44:05. > :44:12.too. 1234 why do you mention it? I
:44:12. > :44:14.mention it because protection there are economies across the EOCD, that
:44:15. > :44:19.offer the work force more security and protection and grow better. Do
:44:19. > :44:26.it better than we are doing. We have already got very little
:44:26. > :44:30.regulation. Why do you want to go further? Essentially, at the moment,
:44:30. > :44:34.if you have a strong economy you can afford to be very good on
:44:34. > :44:39.employment law, and employment security. We haven't, we have a
:44:39. > :44:43.weak economy at the moment. I think anything that makes it easier to
:44:43. > :44:47.employ people will give rights to the unemployed, as opposed to the
:44:47. > :44:55.employed. It will take away what is, I think, unproductive bureaucracy.
:44:55. > :44:59.We have 240,000 tribunals here, it is fundamentally a pretty
:44:59. > :45:03.unproductive activity. It needs picking away at. The that is
:45:03. > :45:07.ridiculous, the idea the economy is slumping, that corporates are not
:45:07. > :45:10.investing, that banks are not lending, that the stock market is
:45:10. > :45:14.falling, that consumption is collapsing because we have
:45:14. > :45:19.tribunals is ridiculous. I didn't say that. He didn't say it was
:45:19. > :45:23.because of it? It doesn't help. Government is refusing to address
:45:23. > :45:26.the real problem, that makes the economy unbusiness friendly. Look,
:45:26. > :45:30.the Government has very little it can do about most of these things,
:45:30. > :45:35.it is dealing with what it can, unfortunately what we are talking
:45:35. > :45:38.about is not a big deal. We can make a dent in unemployment, we can
:45:38. > :45:42.make employing people more attractive. That will be helpful to
:45:42. > :45:46.the economy. Not a lot, but it will do some good. The Government could
:45:46. > :45:53.do a great deal more to make the environment for business more
:45:53. > :45:56.attractive. It could really do more about the banks and lending. It
:45:56. > :46:01.could do more to create investment in the economy which is good for
:46:01. > :46:06.the private sector. The Government is taking a hands-off approach, it
:46:06. > :46:09.says the good thing is what 94 small businesses say are not a
:46:09. > :46:16.problems. Vincent Cable told us this morning, his own department
:46:16. > :46:20.had done a survey and found 94% found regulation was not a problem
:46:20. > :46:24.in employing people. That is not a problem, but we know that the
:46:24. > :46:27.problem is customers are not walking through the door, the
:46:27. > :46:32.demand has collapsed. The Government could generate economy,
:46:32. > :46:38.and they refuse. Explain why those 94% of those
:46:38. > :46:44.small companies are wrong? I think she was saying 94% of businesses
:46:44. > :46:50.didn't think employment regulation is a problem? I I find it totally
:46:50. > :46:55.impossible to brief. How big was the sample? It was conducted by his
:46:55. > :47:02.department. We don't know about the sample? There are plenty of other
:47:02. > :47:07.samples out there they consistently list. Regulation is on the list of
:47:07. > :47:11.things that upsets them. It is a real problem in the a small company,
:47:12. > :47:15.getting rid of a bad employee is a big deal. It costs a lot of time
:47:15. > :47:21.and effort. I'm not disagreeing with that, and I'm not saying we
:47:22. > :47:27.can't do something about tribunals, making it easier for workers and
:47:27. > :47:31.employees. Cuss fom mers are not walking through the door and can't
:47:31. > :47:34.go to, -- customers are not walking through the door, because the banks
:47:34. > :47:37.are watching them. Sufficient unto the day is the
:47:37. > :47:47.discussion there of, tomorrow you are left to the tender mercies of
:47:47. > :47:51.
:47:51. > :47:56.Not as cold as it was last night, frost-free by and large. Breeze
:47:56. > :47:59.yiey across the north and west, windy as we go through the day.
:47:59. > :48:03.Raining pushing across Scotland for a time. The best of the brightness
:48:03. > :48:08.will be further south and east across the UK. Down through parts
:48:08. > :48:12.of north and east of England. Bright and breezy. Winds not
:48:12. > :48:15.excessively strong. A breeze out there. Temperatures doing pretty
:48:15. > :48:20.well, 13 will be typical. Brightness for the West Country.
:48:20. > :48:25.Although the far west of Devon and Cornwall probably staying
:48:25. > :48:30.predominantly cloudy. For west Wales as well, overcast. To the
:48:30. > :48:33.east of the mountains it is hanging on. A windy day for Northern
:48:33. > :48:41.Ireland, sunshine for a time in Belfast, rain looming out west as
:48:41. > :48:44.it will be across western parts of Scotland. Gusts of up to 70mph
:48:44. > :48:48.across the Outer Hebrides. Squally wind as rain sweeps south-east
:48:48. > :48:52.wards. That should clear through, and some sunshine will return to
:48:52. > :48:57.many areas. Blustery showers on Friday. Temperatures fall ago I way,
:48:57. > :49:01.cold enough with wintry showers across the Scottish markets,
:49:01. > :49:07.further Southending reasonably dry and bright. That breeze will still