7 Conclusions and recommendations
Fuel Poverty: targets and trends
1. Despite
efforts to increase incomes and energy efficiency, the Government's
2010 target for the eradication of fuel poverty amongst vulnerable
households in England is going to be missed. Its 2016 target,
for the eradication of fuel poverty amongst all households in
England, looks increasingly difficult to hit. However, we welcome
the Government's support for the retention of this target. (Paragraph
14)
2. We are unconvinced
by the Minister's arguments against the establishment of a road
map for tackling fuel poverty. We accept that, as a result of
the complex interaction of incomes, energy prices and energy efficiency,
reducing fuel poverty is a difficult task; but that simply strengthens
the case for a road map. Greater clarity is needed on: the range
of actions necessary for tackling fuel poverty; how they interact
together; who owns each action; the milestones towards 2016; what
is going to happen if those milestones are not reached; and funding.
We accept that large price increases have made it very difficult
to hit the 2010 target, but the absence of a road map towards
that target has been a contributory factor. The Government should
not repeat that mistake with the 2016 target and must produce
a road map as soon as possible. (Paragraph 15)
Targeting the fuel poor
3. Whilst
we have not looked in detail at the benefits system we are concerned
by the evidence we heard about the difficulties being caused by
the new work capability assessment. We therefore urge the Department
for Work and Pensions to work closely with organisations such
as Macmillan Cancer Support and other relevant bodies to ensure
these concerns are addressed. (Paragraph 21)
4. Using benefits
as a proxy for fuel poverty is a rough-and-ready approach which
means that some people in genuine fuel poverty do not receive
assistance, and others who are not in fuel poverty do receive
help. This is inefficient and inequitable. However, there are
significant logistical and bureaucratic obstacles to the establishment
of the kind of detailed domestic energy efficiency database which
would allow more accurate targeting of resources. We welcome the
work the Government is developing on the National Energy Efficiency
Data Framework and look forward to seeing the results of the pilots
underway. Taking into account those results, the Government will
need to consider whether it would be cost-efficient and feasible
to develop a more sophisticated database of domestic energy efficiency.
The Government should also consider how it could utilise, with
appropriate safeguards, the national programme of installing smart
meters in all homes given the opportunity it provides for data
collection. (Paragraph 25)
5. Given the imperative
of using scarce resources effectively, we are dismayed that it
has taken five years to get data sharing happening, and then only
as a pilot with regard to one cohort amongst the fuel poor. We
urge the Government to assess the results of the pilot speedily
and, contingent on the outcome, hope soon to see measures brought
forward to extend the scope of data sharing. (Paragraph 30)
6. As a means of tackling
fuel poverty, the case for Winter Fuel Payments is weak. Its payment
is unfocused and not targeted on people in or near fuel poverty.
However, as a universal means of supplementing pensioner incomes,
which is easily understood and easy to pay, the political case
for the retention of Winter Fuel Payments is strong. However,
it would be more intellectually honest to rename the benefit;
concede that it a general income supplement; and stop accounting
for it as a fuel poverty measure. (Paragraph 34)
Energy Efficiency
7. We
welcome the Government's household energy management strategy,
which contains a range of measures designed to increase levels
of domestic energy efficiency. In particular, we welcome the provisions
requiring local authorities and energy companies to deliver programmes
which are sensitive to the needs and characteristics of local
areas. We hope that this work will, with the outcome of the CESP
trials, lead quickly to the provision of energy efficiency measures
being delivered on a comprehensive street-by-street basis, in
a way which obviates the need for households proactively to come
forward. This would be an ambitious long-term objective, which
we would like to see included as an important part of the fuel
poverty road map we are advocating. (Paragraph 45)
8. The Warm Front
Scheme has done some very good work in improving the energy efficiency
of vulnerable households and thereby reducing fuel bills. We accept
that it is difficult to prioritise certain categories of eligible
Warm Front customers above others. However, the Warm Front Scheme
is experiencing extremely high demand and diminishing budgets.
Furthermore, we know from the NAO's work that the Scheme does
not always target effectively those who are actually fuel poor.
In that context, we think the Government should look again at
this issue and seek to focus the work of Warm Front on those who
need its support most. We accept also that the Warm Front is not
an emergency scheme; however, we think there is scope, in the
longer term, for the Government to move resources away from the
Warm Front Scheme towards a CESP-style, street-by-street approach
as advocated earlier, and for the Warm Front Scheme to move towards
providing an emergency service for the most vulnerable people
in fuel poverty with urgent heating needs. The Government should
start considering the longer term cost benefits of such a transition.
(Paragraph 55)
9. We recommend that
the Government reviews the operation of the Warm Front Scheme
to ensure that any barriers which may be preventing it being accessed
by people with cancer or other debilitating conditions - such
as time-limited grants - are removed or modified. (Paragraph 57)
Social price support
10. Funding
the new feed-in tariff through fuel bills will disadvantage most
those people who are on low incomes and who are experiencing fuel
poverty. The Government will need to keep the impact of this policy
under review. (Paragraph 64)
11. We welcome the
introduction of mandatory social price support as an imperfect
but necessary means of helping those most in need. We note that
the Government intends to consult on eligibility criteria and
benefit levels, but that it is minded that a significant proportion
of the new resources should be focused on older pensioners. A
case has been put to us for extending social price support to
other groups. While we are sympathetic to that case, there is
a risk that extending support to many more people (for example,
the four million people who are eligible for Cold Weather Payments)
would mean that, unless additional resources are found for the
scheme, the rebates paid to all recipients would not be large
enough to make a significant impact on fuel poverty. We are therefore
not convinced of the case for extending eligibility, given the
resources likely to be available. We note, however, that the Government
is minded to ensure that some support is provided to those who
currently benefit from the voluntary agreement. We welcome this,
and look forward to clarification from the Government about the
nature of that support. (Paragraph 65)
12. A further case
was put to us that some categories of people with cancer - equating
to around 400,000 people - should be eligible for social price
support. We note the strength of the argument put to us and recommend
that the Government look to see how people with a serious medical
condition could benefit from social price support as part of its
consultation later this year. (Paragraph 66)
Households off the gas grid
13. We
are pleased to note the Minister's enthusiasm for the potential
for novel technologies to help alleviate fuel poverty for people
off the gas grid, but are disappointed about how long it has taken
to assess these technologies. It is clear that work on this is
at a very early stage and we urge the Department to report back
on the trials currently underway at the earliest opportunity.
Households off the gas grid pay more for their fuel and are more
likely to be in fuel poverty and the Government should ensure
that it takes effective steps to help them. (Paragraph 72)
14. We note the difficulties
inherent in seeking to regulate the market for fuels bought by
people off the gas grid. However, this group is disproportionately
likely to be fuel poor and we believe the Government must review
urgently the case for regulating this market. As a more modest
step, we urge DECC to discuss with HM Treasury the case for flexibility
in the timing of winter fuel payments, so that people off the
gas grid have the opportunity to maximise the fuel they are able
to buy. (Paragraph 75)
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