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Lord Lucas moved Amendment No. 251:

Page 79, line 20, at end insert--
("( ) For the purposes of the definition of "owner" in subsection (1), the net annual value of a dwelling means the rent at which the dwelling might reasonably be expected to be let from year to year if the tenant undertook to pay all usual tenant's rates and taxes and to bear the cost of repair and insurance and the other expenses, if any, necessary to maintain the dwelling in a state to command that rent.
( ) Any dispute arising as to the net annual value of a dwelling shall be referred in writing for decision by the district valuer.
In this subsection "district valuer" has the same meaning as in the Housing Act 1985.").

The noble Lord said: I spoke to this amendment with Amendment No. 240. I beg to move.

On Question, amendment agreed to.

Clause 135, as amended, agreed to.

1 Apr 1996 : Column 120

Clause 136 [Home energy efficiency schemes]:

Lord Williams of Elvel moved Amendment No. 252:

Page 79, line 45, at end insert--
("(3) Grants under this section shall be available to--
(a) any applicant in receipt of income support, family credit, housing benefit, council tax benefit, disability working allowance or disability living allowance, or
(b) any applicant over 60 years of age.").

The noble Lord said: In moving this amendment it may be for the convenience of the Committee if I speak also to Amendment No. 253 in the name of the noble Lord, Lord Ezra. We embark here on home energy efficiency schemes, which were introduced in 1991. The purpose of my Amendment No. 252 is to abolish the introduction of means-tested criteria for applicants for home energy efficiency schemes grants who are over 50 years of age. I do not believe that I need enlarge on the object of this amendment. The noble Lord, Lord Lucas, may well argue that the introduction of a form of means-testing for pensioners will compensate for the reduction in HEES funding by allowing a reduced sum of money to go further, but experience suggests that that is not the case. The requirement to pay 75 per cent. of the cost of works for those not on means-tested benefits will be a significant deterrent to take-up. Measures adopted by regional electricity companies have offered a range of support for energy efficiency measures. It has been shown that grants of less than 75 per cent. are not successful, with very little take-up below that level. I beg to move.

Lord Ezra: The issues raised by the noble Lord, Lord Williams, are of considerable importance. There was a commitment in the previous Finance Bill for the home energy efficiency schemes to be funded to a total of £100 million for three years. That commitment was repeated by Ministers throughout last year and as recently as last May. The result of that commitment was that an increased number of homes, particularly of elderly people on small incomes, were insulated and, as a result, much energy saving was achieved. There was a gearing up of the staff required to carry out that work.

The results of the measures now intended--that is, the reduction of £31 million in the £100 million originally vouchsafed and the means-testing of people of pensionable age--will have serious repercussions. I turn first to the case of people of pensionable age who will be means-tested. Very many people of pensionable age who do not receive income support (which is the test), in fact do not claim it although entitled to it. The DSS has estimated that about one-third of pensioners do not claim who could do so. Quite apart from those who could claim technically, a large number of pensioners live just beyond the level at which they could claim but they cannot afford to pay the extra amount. They will thus be deprived of the insulation benefit.

As a result of the cut-back, some 200,000 fewer homes will be insulated. There will be a loss of 1,000 jobs in small businesses. Some £12 million which would otherwise have been expended on insulating materials will not be so expended. That will not only mean greater disadvantage in environmental terms, but will have a

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serious impact on health. A sobering statistic is that excess winter deaths in Britain in recent years have increased to something like 55,000. That is vastly in excess of excess winter deaths in any other western European country. In Denmark, which is at the other extreme, there are very few more deaths in winter than in summer, because of attention to good housing conditions. There is very little doubt that those extra deaths are of elderly people living in cold and damp conditions.

Therefore, I believe that the measures that the Government now propose to cut that vital expenditure, to subject pensioners to means-testing and to widen the scope of the use of the reduced availability of funds so that even less will be expended on insulation, will have serious adverse effects--serious from the economic, environmental, health and social points of view. Therefore, in the light of the difficult situation created by the clause, I very much hope that the Government will think again.

Earl Ferrers: The noble Lord, Lord Williams, in his amendment, Amendment No. 252, wants to ensure that any future domestic energy efficiency grant schemes will be confined to the same groups of people as are eligible for the existing home energy efficiency scheme. The present power allows grants to be paid only as prescribed by regulations, which may make provision for, among other things, the types of dwellings to be included, details of the work that may be done and the categories of people who may be eligible for grants. This is quite deliberately intended to give maximum flexibility within the overall purpose of improving the thermal efficiency of dwellings, reducing or preventing waste of energy and giving people advice about energy use.

I understand the desire of the noble Lord to put into primary legislation the social aims of the present scheme, but Amendment No.252 will have the effect of restricting unnecessarily the flexibility which the present power provides. It is a flexibility which Clause 136 will extend, which several noble Lords and others have welcomed. I think that what is suggested is a retrograde step. We could not reflect any future changes to the social security benefits structure without the lengthy procedure of a new Bill to amend the Act. I do not believe that Amendment No.252 will do any more to help the elderly, poor and disabled than is already being done through the Home Energy Efficiency Scheme. We are committed to continuing to help those vulnerable groups. I hope that the noble Lord, Lord Williams, will accept that point of view.

As regards Amendment No. 253, the noble Lord, Lord Ezra, said that we had given an undertaking in the sum of £100 million for three years. I knew that this would come up. I remind the noble Lord--as I have before at Question Time--that the undertaking was to go up to £100 million for that year and to increase the base line to £100 million for the next two or three years. As a result of that, the noble Lord suggests that the Government have been disingenuous. Although those are not his words, that is the inference to be drawn from his comment.

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The noble Lord knows only too well that all government departments operate on base lines. They must all proceed over the next two years not on undertakings but on base lines. The base lines inevitably have to be altered from time to time. Every year in the terrible Public Expenditure Survey round the Government, like any other business, have to decide, where cuts can be made if cuts have to be made. The fact was that it was necessary this year to make cuts. It was not an undertaking last year that for the next two years that money would be available, only that the base line would have that money available.

I understand the desire to maintain the grants paid under a very successful scheme. But it would be quite impossible to suggest that a figure should be written into a Bill. It would be extraordinary to have a funding commitment and power dealing with a grant scheme in a Bill. One can hardly envisage the effect of having every expenditure commitment enshrined in primary legislation. Of course, that is not the noble Lord's intention, but if this amendment is accepted the commitment will be enshrined in legislation. I suggest that that would be wholly wrong.

The noble Lord is concerned about the Home Energy Efficiency Scheme. I remind him that householders may be eligible for one or more benefits: income support, housing benefit, council tax benefit, family credit or disability working allowance. All householders age over 60 are eligible for grant, but from 1st April the grant is limited to 25 per cent. if claimants do not qualify on any of the grounds that I have just mentioned. We are targeting the money available to those who are most inconvenienced in the community, and those householders who are 60 and over and do not qualify for other grants because they happen to be better off do not get 100 per cent. grant but still get a 25 per cent. grant. That is a reasonable way in which to deal with the matter. People who took advantage of the grant have benefited from it. We are targeting the grant on those most in need of it.

Lord Ezra: I do not follow what the Minister said about the £100 million. I have many quotes about it from Ministers. I shall relate just one which is at variance with what we have just been told. Mr. Robert Jones, a Minister in the Department of the Environment, in a Written Answer in another place on 22nd May, said:

    "During l995-96, some £100 million will be made available for grants, and a similar sum has been set aside for each of the next two years".--[Official Report, Commons, 22/5/95; col. 386.]
I do not see that that can mean anything but a firm commitment by government at that time for £100 million to be made available for l995-96 and that further similar sums were set aside for the succeeding two years.

It does not seem to me that that accords with what the Minister was saying. If the Government have changed their mind, as they evidently have, that is an unfortunate fact, and that is what I am arguing against. As to the impact, it will mean--whatever way it is looked at--that 200,000 homes which would otherwise have been insulated will not now be insulated; and a

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number of deaths from damp and cold conditions which would otherwise have been prevented will not now be prevented.

The Government were moving in the right direction. I believe that at the time the Prime Minister was very much in favour. I have no evidence for that, but I was told he was. Having taken a step which brought so much extra comfort to the elderly and people on low incomes, it is unfortunate that the Government have now taken part of it away without notice, without consideration of previous commitments and without thought of the enormous amount of good it was doing and will no longer do. We should return to the matter if the Minister is not prepared to give any assurances at this stage.

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