This is a House of Commons Committee report, with recommendations to government. The Government has two months to respond.
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High energy bills have caused serious difficulties and hardship for customers and businesses across the UK. Although the Department was able to implement energy bills support for the majority of households and the non-domestic sector for winter 2022–23, it took too long to get support to some of the most vulnerable and hard to reach customers. Some 900,000 households only became eligible to apply for the Energy Bills Support Scheme Alternative Funding, for domestic consumers, on 27 February 2023, nearly five months after consumers began receiving discounts on the main scheme. In addition, 836,000 households in Northern Ireland only began receiving support with their energy bills from the Energy Bills Support Scheme in January 2023, three months later than in Great Britain. As of February 2023, a quarter of the vouchers issued for the Energy Bills Support Scheme for two million households on traditional prepayments meters have still not yet been redeemed. In February 2023, the Department estimated that support for households and businesses will cost £69 billion, of which it paid out £16 billion through the schemes between October and December 2022.
The Department has drawn on lessons learnt from its financial support schemes during the pandemic to reduce the risk of fraud and error in the energy support schemes, but it does not yet know how successful this has been. The Department does not have a clear understanding of the pressures non-domestic consumers will face from April 2023 when support will reduce significantly with the ending of the Energy Bills Relief Scheme and transition to the Energy Bills Discount Scheme. The latter risks undermining government’s objective for the schemes to achieve wider economic benefits. The Department is planning changes to both the domestic and nondomestic schemes and reforms to the energy market, but we are concerned that the Department lacks urgency in implementing these changes given the huge impact that high energy costs have already had on the public purse.