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The Government must take urgent steps
to help people struggling to pay heating bills, as current efforts
to tackle fuel poverty are not working, argues leading think tank
the Institute for Public Policy Research (ippr).
The cold weather conditions seen in the UK over the past few weeks
have highlighted the urgent need for the Government to commission an
independent review of its emergency measures to help people cope
with peaks of cold weather and its longer-term strategy to address
fuel poverty to reduce rising winter death rates in future.
ippr’s research suggests that numerous fuel poverty programmes and
hundreds of millions of pounds invested by the Government and by the
energy industry have failed to address the problem adequately. ippr
says it’s time to think again.
ippr argues that this year’s exceptionally cold winter will lead to
more people dying because they can’t afford to pay their energy
bills. It highlights that the Government has a target to eradicate
fuel poverty by 2016, but despite this, in the last five years, the
problem has been increasing (reversing the improving trend of the
last decade).
The standard definition of fuel poverty means that someone is fuel
poor if they need to spend more than 10 per cent of their income to
keep warm.
Inevitably, three current trends mean that fuel poverty is expected
to rise:
Energy prices are set to rise for the foreseeable future as we get
to the end of the era of cheap energy.
The incomes of poorer households are likely to fall because of the
recession and its aftermath.
The poor quality of much of the UK housing stock in terms of heating
and insulation standards.
Current government initiatives such as the Winter Fuel and Cold
Weather Payments, a collection of energy efficiency schemes and
energy price support programmes are providing help, but it is not
sufficient to deal with the growing problem of unaffordable fuel
costs, which contributed to the deaths of 36,000 people last year, a
49% increase over 2007/08.
ippr says that some bold new thinking is needed to prevent the
problem worsening over the long-term.
In a forthcoming report ‘Fuel poverty, where next?’ ippr will argue
that the Government should commission an urgent and independent
review of the UK’s short term fuel poverty measures and longer-term
fuel poverty strategy as the current strategy – which dates from an
era when energy prices were falling – is not fit for purpose.
ippr argues that government should take the following steps:
Prioritise energy efficiency measures (over assisting people with
paying their bills) as it is a more sustainable and cost effective
way of tackling fuel poverty in the long run.
Ensure fuel poverty programmes are paid for in a way that is fair.
While making energy companies pay for schemes to help their poorest
customers (as proposed in the Energy Bill going through parliament)
may seem attractive, this means that energy customers are paying
through their fuel bills, which is not fair because people on lower
incomes pay proportionately more towards the costs of these schemes.
The Government should at least match any extra money they are making
the energy companies spend through fairer taxes and public spending
to combat fuel poverty in the long run.
More should be done to make the most of technological innovations
such as smart meters, micro-generation technologies and
community-scale heating.
Work in partnership with organisations like Local Authorities and
not just the energy companies, in the fight against fuel poverty.
Lisa Harker, Co-Director of ippr, says:
“During this bitter cold snap, the obvious thing to do is to turn up
the heating at home. But sadly, the proportion of people in this
country who cannot really afford to do that is now rising again. The
recession means there is less money around to reduce fuel poverty,
and at the same time energy prices are going up.
“The latest Government legislation puts greater emphasis on the
energy companies helping low income households, but this in itself
will not be enough. We need a new, far-sighted fuel poverty
strategy, which ensures that wealthier households pay their fair
share, and that sustainable energy saving measures are prioritised.”
The Government’s Energy Bill was introduced in the House of Commons
on 19 November 2009 and received its Second Reading on 7 December
2009. It is now in Committee phase. The Bill contains proposals to
introduce ‘mandatory social price support’, which would help to
tackle fuel poverty by lowering the energy bills of more of the most
vulnerable consumers and giving greater guidance on the types of
households eligible for support. These measures will be funded by
requiring energy companies to make available at least £300 million
per annum by 2013-14 on social support. (See
http://man270109a.decc.gov.uk/en/content/cms/legislation/energybill/energybill.aspx
for more information)
There were an estimated 36,700 excess winter deaths in England and
Wales in 2008/09 – an increase of 49 per cent compared with figures
for 2007/08. The 2009/10 figures are very likely to be higher still.
The Department for Energy and Climate Change is running a review of
its own on fuel poverty at the moment, but its focus is on making
incremental changes to the existing strategy. ippr’s research
concludes a much bigger picture, radical and independent review
chaired by a national figure is needed.
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