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11.33 am

Mr. David Drew (Stroud): I congratulate my hon. Friend the Member for Bury, North (Mr. Chaytor) on obtaining the debate. I shall concentrate on fuel poverty as it affects pensioners and I shall do that mainly because for the past decade I have been a committee member of Care and Repair England in Stroud. I declare that as an interest which has given me an insight into the problems affecting pensioners in particular.

We all know why pensioners are especially vulnerable to fuel poverty. They are among the poorest in our community and there is a great disparity between the incomes of rich and poor pensioners. In addition, many pensioners spend hours at home while other people are at work or engaged in other activities, and they tend to live in the oldest properties, which are most deficient in energy efficiency. Last but not least, pensioners tend to suffer more from illness and mortality. According to Department of Health statistics, hypothermia deaths alone account for almost 500 people a year. Of course that is directly related to energy efficiency.

According to the last census in 1991, more than 2,500 pensioner households in my constituency did not have central heating, and that is a microcosm of the country. Many pensioners are on low incomes and experience fuel poverty. Some 1.7 million pensioner households depend on income support and even on the lower measurement of the Neighbourhood Energy Action's affordable wealth campaign, about 1.3 million pensioners are in need of energy efficiency support.

I welcome the Chancellor's proposal in his green Budget for extra help with the cost of heating all pensioner households and to target additional help on

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pensioners on income support. However, many pensioners choose not to take up income support; that is a problem in its own right. My hon. Friend the Member for Bury, North graphically explained many other measures that the Government have presented. I suggest a small change to income support regulations that would help to reduce fuel poverty for pensioners.

The previous Government amended the income support regulations in October 1995. Before that, regulations entitled people who were eligible for income support to receive assistance with the interest on a bank or building society loan that had been taken out, among other things, to install central heating. That enabled many older people to purchase modern energy-efficient heating systems. Many of them installed central heating for the first time or replaced antiquated or inefficient systems. The benefits included lower running costs for the householder, a reduction in condensation, which is damaging to the condition of a house, a reduction in cold-related illnesses and, of course, a reduction in CO 2 emissions, which damage the environment.

From October 1995, the Conservative Government restricted income support assistance for interest on loans; only those for repairs to existing heating systems are now eligible. That means that many older people must continue to rely on older heating systems that are inefficient and expensive to run. I ask the Minister to consider, in liaison with the Treasury, reinstating the installation of new energy efficient heating systems as an eligible item under income support regulations.

The economic and health-related benefits of energy efficient heating systems are well documented. For those who live in fuel poverty, the initial capital investment that is required can be prohibitive. Because their existing heating systems are inefficient and costly to run, they cannot afford to save or to borrow sufficient money to meet the cost of installing a new efficient heating system. The Conservative Government's Department of the Environment energy efficiency best practice programme guide No. 171 suggests that the cost of moving to an energy-efficient heating system can be recouped within five years. The call on the public purse to enable older people who live in fuel poverty to improve their heating systems would be relatively small--in some cases not much greater than the £50 a year payment to pensioners on income support. The great advantage of that Government subsidy is that it would reduce older people's future fuel bills rather than assist with the high running costs of old, inefficient heating systems. The estimated cost of running an old central heating system with poor controls is about £1,000 a year. Installing a condensing boiler and good heating controls would lead to a saving of 20 per cent., or £200, a year. The cost of installing a new central heating system in a traditional mid-terraced house would be about £1,600.

If the interest on a loan for that amount was eligible for income support housing costs, at the current standard rate of interest used in income support, the cost to the public purse would be about £2.30 per week for about four years, a total Government subsidy of less than £500. That would be a prudent use of a relatively small amount of Government expenditure, which would have substantial long-term benefits for the fuel poor and for the environment.

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Those changes could be linked to a reinvigoration of the home energy efficiency schemes--HEES--which were mentioned by previous speakers. Unfortunately, the previous Government restricted HEES work to pensioners on benefit and to larger-scale operations, which has had a deleterious effect in my constituency. As the hon. Member for Truro and St. Austell (Mr. Taylor) said, it is important to integrate energy efficiency with other measures.

I want to deal with a second area, in which I have some expertise--the work of home improvement agencies. As I said at the beginning of my speech, I have a long association with Care and Repair England. The Department of the Environment, Transport and the Regions already supports a growing network of home improvement agencies, such as Stroud Care and Repair in my constituency. Those not-for-profit agencies have developed great expertise in assisting, in particular, older people living in poor quality housing to improve their living environment. They are also able to offer considerable advice on the best way to insulate and carry out repairs to their housing.

Home improvement agencies--usually called Care and Repair or Staying Put--are now recognised by all major political parties as having developed a sound track record in providing personal support and practical assistance to older people and, within that group, disabled people who live in poor or unsuitable housing. Their work incorporates a wide range of repairs and adaptations, ranging from a handrail to extensive renovations. Obviously, I want to concentrate on fuel poverty, where the clear aim of Care and Repair's strategy is to keep people in their own homes for as long as possible, and heating those homes to keep people warm is a major part of that strategy.

Inevitably, these matters link with community care--and housing is the missing limb of community care. My right hon. Friend the Secretary of State for Health frequently refers to a Berlin wall between health and social services. We must not forget housing as part of the community care programme, as people go back to their homes.

Not only have home improvement agencies developed the necessary technical knowledge and skills, they have developed the financial expertise to bring in funds from a wide range of sources, including charitable funds, insurance, the national lottery, the utility companies and equity released from the home. Many agencies are also working actively with local authorities on the implementation of the Home Energy Conservation Act 1995.

The national body for home improvement agencies, Care and Repair England, is working with other parties on maximising the use of equity release, in particular for older people in energy-inefficient housing. That will involve partnership working between home improvement agencies, local authorities and building societies and will bring in private finance to complement the use of public funds available through local authority housing grants and home energy efficiency scheme grants. Care and Repair England has also developed a particular expertise--again, in partnership with commercial and voluntary sector bodies, as well as with the Government--in addressing the problems of energy inefficiency in poor housing. It is currently planning research to improve and refine work in that area.

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I suggest to my hon. Friend the Minister not only that a change to the income support regulations be considered, but that thought be given to strengthening the mechanisms for delivering help to older people through home improvement agencies. My hon. Friend the Minister for Local Government and Housing recently gave a strong endorsement to home improvement agencies through the allocation of an additional £750,000. She also announced a review of the funding mechanism.

In the context of this debate about fuel poverty, I draw my hon. Friend the Minister's attention to the capacity of home improvement agencies to make a useful contribution, both technically and financially, to combating fuel poverty and energy inefficiency and to express the hope that any changes to the funding system will preserve and, indeed, strengthen their ability to bring to this area of work a strong voluntary sector contribution and an expertise in accessing non-Government finance.

In the context of a home improvement agency service that can deliver the service and maximise the use of equity release, the proposed change to the income support regulations will assist such organisations to improve the living conditions of thousands of older people who are living in fuel poverty at the threshold of the 21st century.

The task is surely to link such vital organisations to a truly comprehensive programme of energy efficiency to reduce fuel poverty, pulling in the voluntary sector to work with landlords, local and central government, fuel industry regulators and, indeed, individual householders, to show that we have the political will, as well as the economic, social and environmental understanding, to grasp this important nettle.

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