The Treasury is refusing to testify to MPs about its crucial involvement in energy reforms because it wants to avoid difficult questions, Tim Yeo, the chair of the Energy Select Committee has claimed. Energy companies and investors unhappy that the Treasury will not act as guarantor on proposed long-term contracts setting power price subsidies.
Mr Yeo’s committee is scrutinising the draft Energy Bill, which the Government wants to stimulate £110bn of investment in new power plants.
Industry figures say parts of the Bill have changed significantly from the original proposals – apparently at the Treasury’s behest – and have warned that the changes could make the reforms unworkable.
But Treasury minister Chloe Smith has so far declined to give evidence to the committee. In a letter sent to Ms Smith today, Mr Yeo said the committee was “perplexed” by her assertion that it would be “improper” for her to give evidence as the legislation was led by a different department.
“Your refusal to give oral evidence will seriously inhibit the effectiveness of our inquiry,” Mr Yeo wrote.
“It looks to me as though they don’t want to come because they would find the questions difficult to answer,” he told The Daily Telegraph.
Energy companies and investors have said they are unhappy that the Treasury will not act as guarantor on proposed long-term contracts setting power price subsidies, as they had been expected to do. Energy ministers are thought to be trying to persuade the Treasury to take on the role.
The industry has also raised concerns that the contracts, supposed to guarantee returns on investment, now risk being overridden by short-term Treasury caps on levies.
Mr Yeo said the issue “undermines the credibility of the regime at the heart of the Bill”.
A Treasury spokesman said it was normal under “established parliamentary procedure” that only the lead department – in this case the Department of Energy and Climate Change – would give evidence in pre-legislative scrutiny.