Examination of Witnesses (Questions 20-39)
Wednesday 22 October 2003
Sir Brian Bender, Mr Jeremy Eppel; Mr Chris Leek,Mr
Garry Worthington, Warm Front, General Manager, POWERGEN UK, examined.
Q20 Mr Williams: We are talking of
12%. 12% is 18 million which brings us to 132 million. Nearly
half of that goes to people who are not eligible in terms of being
fuel poor.
Sir Brian Bender: Correct.
Q21 Mr Williams: If you take 70 away
from 132, it means that in terms of hard impact we are getting
62 million out of 150 million that is going to helping those who
are in need and who are fuel poor.
Sir Brian Bender: That is correct,
but—
Q22 Mr Williams: That is not very
good, is it?
Sir Brian Bender: The implication
is that therefore the others are people who ought not to be helped.
These are still vulnerable people receiving certain benefits,
some of those who might have been in fuel poverty if they had
not been helped, like pensioner couples.
Q23 Mr Williams: That is all well
and good but that is not the objective of the operation, is it?
The objective of the operation is to find those who are suffering
most from fuel poverty and they are to have priority. Because
you cannot find a way of assessing correctly, what we find is
that just 40% of the total scheme is going to those who are suffering
fuel poverty in terms of end product in their houses.
Sir Brian Bender: That is roughly
the right calculation, yes.
Q24 Mr Williams: 40% is not a very
high strike rate, is it?
Sir Brian Bender: That is why
we want to look at the targeting and the eligibility criteria
as we revise the scheme further. I would repeat that those others
who are being helped are vulnerable people and I would not want
to give the Committee the impression we do not think they are
worthy of help, even if they are not the main priority of the
scheme.
Q25 Mr Williams: They are having
money that should be going to other people who are more in need,
are they not? I accept entirely that there are people even beyond
those who are receiving the 60% who probably could do with some
help but the aim here is to aim for the most vulnerable and needy.
The scheme is less than 50% effective. That is a pathetic performance
by any standard. Are you going to improve it?
Sir Brian Bender: I do not regard
it as a pathetic performance. This is a very difficult issue.
Q26 Mr Williams: Do you regard it
as a good performance?
Sir Brian Bender: The risk is
that in complicating the eligibility criteria we will discourage
people from applying. Getting this right is not easy. The answer
to your direct question is yes. We are looking at how to get a
set of criteria to move forward which would or might include the
SAP rating of the property.
Q27 Mr Williams: How soon will you
do that?
Sir Brian Bender: We are going
out to consultation on this with a view to the revision of the
scheme by 2005.[2]
Mr Eppel: We intend to look at
this. We are indeed looking at this now as part of looking at
the implementation plan for the fuel poverty strategy. That report
on the implementation plan will be introduced at the end of this
year. When such a new measure could be brought in will probably
be when the scheme is revised in April 2005. The intention is
to explain the thinking on this much, much sooner than that. The
scheme was originally designed to address all vulnerable people,
not just those demonstrably in fuel poverty. There is no direct
correlation between people in fuel poverty and a given house,
but there is quite a strong relationship between a very poorly
insulated or heated house and the potential for people moving
into that house at some stage to fall into fuel poverty. Whilst
we fully intend to try and improve the targeting of the scheme,
we also realise that by directing resources to houses which have
the potential for people to get into fuel poverty we will be mitigating
the risk of that to an extent in the future. I do not think resources
are wasted but we would agree it needs to be even better targeted.
Q28 Mr Williams: That was a great
flow of words but we remain in the situation where 60% a year
for the next three years is going to go to people other than those
it was intended for. That is going to be a colossal sum of money
over the years since the scheme started that and that is abysmal
by any standards. That is an observation. I am not asking a question.
I do not want to unleash another irrelevant set of information.
Let us look at the way in which you deal with cases even when
you are hitting targets. If we look at figure 17 on page 23, we
are told there, "The Scheme rules do not always lead to the
best solutions." We are given a couple of examples there.
Let us take the first one. "A property needed a replacement
boiler. Under the Scheme rules this replacement could only be
a basic boiler of the same kind." This is a ludicrous rule
when you look at the rate of technological change. As it happened,
that particular boiler that needed to be replaced also had a condemned
flue which needed to be replaced, but the condemned flue and the
scaffolding for the flue were going to cost £2,500. That
is without a replacement boiler. For £1,500, an up to date
combination boiler could have been installed. Does that strike
you as a good way to run a whelk stall?
Sir Brian Bender: No. The original
reason why we had like for like replacements was because it was
judged at the time that that would be a means of providing for
as many households as possible in the most cost effective way.
Experience shows that is not right and we are now working with
the scheme managers on criteria to provide new or different systems
more effectively. The answer is we are working on how to improve
the situation.
Q29 Mr Williams: You are working
also on the 60% but that is going to be another two years. How
long will your working on this take?
Mr Leek: The important thing within
this answer is that we did fit a combination boiler rather than
trying to replace on a like for like basis and we did it through
measures that we had traded on Warm Front into the—
Q30 Mr Williams: I am glad common
sense prevailed. When will the new criteria be operational?
Mr Leek: It is something which,
given the instruction, we can implement straight away.
Q31 Mr Williams: You go out of here
today, sign a piece of paper and we can take it that from tomorrow
everything is going to be all right?
Mr Leek: As scheme managers, we
can change that.[3]
Q32 Mr Williams: Knowing you were
coming here, surely self-survival would have told you to sign
it yesterday so you could come here and say, "We have already
signed it." Why did you not do that—or last week?
Mr Eppel: We certainly have a
very clear intention of changing the rules to make them more sensibly
aligned in terms of the replacement boilers, not just having the
like for like rule, at the earliest opportunity. We have to make
sure that that fits in at a moment when it can be done administratively
sensibly, but that does not mean it will be 18 months or two years
until it happens. I suspect it will happen pretty soon.
Q33 Mr Williams: If we take the next
case in 17, the second incident described here is an applicant
requiring a replacement for a warm air heating system. Under the
rules, a replacement would cost £2,200, but a better system
could have been installed, not warm air, for £2,000. There
is a little amount saved, but the important thing is that that
family had a child who had a severe asthmatic condition which
was known to be exacerbated by warm air heating; yet you were
still, under your rules, insisting that they should have warm
air heating.
Sir Brian Bender: The problem
was resolved in the way described at the end of the example.
Q34 Mr Williams: How long ago would
this be? A month? Six months?
Mr Leek: This was something that
happened around last Christmas time. Once we surveyed the property
and identified that, we had the thing changed and done within
three weeks.
Q35 Mr Williams: How long ago was
the first one I put to you with the scaffolding?
Mr Leek: I do not recall.
Q36 Mr Williams: The question that
arises is, since this makes very clear that your criteria were
not achieving the correct objective, why is it that we are still
here at this date, at the end of October, waiting for you to decide
to issue tomorrow morning a signed note saying, "We are going
to change our criteria"? Why did you not act on these examples
earlier?
Sir Brian Bender: There are two
answers. First of all, the concrete problems that the individual
households had were addressed through trading under the Energy
Efficiency Commitment. Second, we are looking at changing the
criteria and will do so expeditiously.
Q37 Mr Steinberg: It is not a very
good Report, is it? It is not really achieving what you intended
to achieve. Why does it have to be in a particular sector? Why
does it need to be in social housing sector or private sector?
Why can it not be those people who are in fuel poverty helped?
Sir Brian Bender: We are addressing
the social sector through the Decent Homes Standard. When the
Committee of Public Accounts last looked at this issue, it was
partly as a result of that that we decided to apply Warm Front
to the private sector and have a different set of measures through
standards—
Q38 Mr Steinberg: It seems to me
that if you are in fuel poverty, it does not matter where you
live; you are still cold, are you not?
Sir Brian Bender: You are cold
and the question is what is the most effective set of measures
to do this in a situation that is—
Q39 Mr Steinberg: You are not achieving
it.
Sir Brian Bender: We are helping
vulnerable people.
2 Note by witness: A stakeholder event to discuss
the future design of Warm Front will take place on 18 November. Back
3
Note by witness: We are working with Defra to establish
criteria to identify those situations when it is more appropriate
to provide a new or different system to that which is already
installed. Back
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