Fuel poverty to rise to 8.5m, report warns

 

Energy secretary Ed Davey has told the BBC that the government remains committed to do all it can to tackle the problem of fuel poverty.

Fuel poverty in England is likely to worsen, despite measures to try to eradicate it, a government-commissioned report has warned.

Some 7.8 million people could not afford their energy bills in 2009, its author, Prof John Hills said. This is due to rise to 8.5 million by 2016.

Campaigners have called for more money to be invested in cutting bills.

The government has said it is committed to tackling the problem which has been linked to 2,700 deaths a year.

"Fuel poverty is a serious national problem and this government remains committed to doing all it can to tackle it and make sure that the help available reaches those who need it most," said the Secretary of State for Energy and Climate Change, Ed Davey.

The previous government had said it was committed to eradicating the problem, "as far as reasonably practical", by 2016.

Start Quote

"The number of fuel poor households helped by government-backed schemes is likely to more than halve over the next three years, despite fuel poverty levels having almost tripled in five years”

End Quote Derek Lickorish Fuel Poverty Advisory Group (FPAG)

Prof Hills' interim report last year said almost 3,000 people died each year from problems linked to fuel poverty such as respiratory or cardiovascular disease. It said the problem was getting worse as energy costs rose.

But he said the difficulties went beyond health to education and climate change.

"It is also bad for families with older children, if they can't afford to keep a room warm enough for them to get on quietly with their homework," Prof Hills told the BBC.

"People who find their homes hard to heat are pumping out carbon into the atmosphere which is blocking some of the efforts to reduce carbon emissions."

Green deal

Prof Hills' report redefines fuel poverty to focus on households which are both on low income and have relatively high bills.

The new definition includes many lower-income households with relatively high heating and cooking costs which may have been ignored in the past.

A old person holding money in front of a gas fire Fuel poverty is expected to rise over the next four years

"When one focuses on the core of the problem in the way I propose, the outlook is profoundly disappointing," said Prof Hills.

"With the scale of the problem heading to be nearly three times higher in 2016 - the date legislation set for its elimination - than in 2003."

The government has said it will publish its own new definition in the summer.

Regressive

He called for action to insulate the poorest homes, but warned current government measures would have mixed results.

Case study

Anthony Ford from Wallsend had to give up work two years ago to became a carer for his wife. He's is finding it harder and harder to meet the rising cost of his fuel bills.

"I have had to agree on £100 per month from my £220 per month carer's allowance [for fuel bills].

"Needless to say my savings have disappeared over the last two years.

"The better news is my wife is in remission and she will return to her part-time job at the local school.

"We do not know yet how we will pay the bills. In the last couple of months my gas, water, electric, media services, TV Licence and life and home insurances have escalated - and now my mortgage.

"My carer's allowance has not changed. I do not know what the future holds for us as a family.

"There are people who are working who can't make ends meet, but I'm not able to work because of my wife's illness.

"I've got to have the heating on for my wife. I've had insulation done and I've read my meters every week for the past five years because I'm careful about these things.

"I'm using no more that I was five years ago, but I'm paying three times as much for my gas and electricity."

The Energy Company Obligation (ECO) allows firms to levy a flat charge on bills to subsidise insulation.

But with only a quarter of the money specifically targeted at low-income homes, Prof Hills warns it may be "regressive", driving extra homes into fuel poverty.

The government's own Fuel Poverty Advisory Group (FPAG) has called on it to use projected revenues from a minimum price on carbon and carbon trading to tackle fuel poverty.

The government said it is already tackling the problem through a range of other measures, including the Warm Homes Discount, which offers help with bills to low-income households.

New approach

"The number of fuel-poor households helped by government-backed schemes is likely to more than halve over the next three years, despite fuel poverty levels having almost tripled in five years," said Derek Lickorish, chairman of the FPAG.

The new definition is designed to exclude households who are relatively wealthy and have high bills, or who are living on low incomes but have relatively low bills.

By this definition, the report finds 7.8 million people were fuel-poor in 2009, across 2.7 million households, more than previously thought.

Under the previous definition, which focused on households spending 10% of their income on bills, four million households were in fuel poverty but with 7.6 million inhabitants.

Projected rise in fuel poverty
Poverty gap

In addition to examining the extent of fuel poverty, the report also includes a measure of its severity.

The fuel poverty gap shows the amount by which bills would need to be cut, in order for fuel-poverty households to be able to afford to heat their homes.

The report found that in 2009, this figure was £414 per household. By 2016, the report warns, it may be £600.

Campaigners have welcomed the report and also called for a programme of home insulation.

"The time has come for the government to step up and invest to help the fuel-poor households through a major expenditure and an extensive insulation programme," said Michelle Mitchell, director general at Age UK.

 

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  • rate this
    +5

    Comment number 214.

    Energy companies are fleecing us - cash for renewables, ridiculous unjustifiable price hikes for usage & standing charges, no effective control, no real competition, unfettered profiteering. Greedy, corrupt and a disgrace - wake up Cameron & stand up for the public.

  • rate this
    +2

    Comment number 213.

    I would stage a protest to demand a reduction of fuel tax during the 2012 London Olympic

  • rate this
    -2

    Comment number 212.

    Clean spark spread for a modern, efficient gas fired power station (on the open market) £1.50 /MWh if you're lucky. Feed-in tariff for solar power 46p/kWh = £460/MWh. Level playing field my ar$€! As soon as we factor out the subsidies for renewable energy (renewable - that's a laugh!) then we might see energy prices becoming more sensible.

  • rate this
    0

    Comment number 211.

    I urge everyone to use as little gas / electricity as possible during Summer.

    When will govt do something about rising energy prices ?

    When people start switching off their TV's . . then you'll see some action on the matter.

  • rate this
    0

    Comment number 210.

    We need to demolish much of our aged housing stock and rebuild with sensible living technology that is efficient, sustainable and compatible with renewables. That means much of our Victorian housing stock has to be flattened. Otherwise we will not be able to heat and light our nations living spaces.

  • rate this
    +1

    Comment number 209.

    It's gonna be fine imagine all the pension money the goverment will save be save after the next hard winter.

    After all pensioners don't pay tax.... anymore

    oh except for vat

  • rate this
    0

    Comment number 208.

    Dispite a drop in energy consumption the companies make gigantic profits up year on year this year was mild what will happen in a really cold winter these companies will have very cold blood on their hands yet the gvmt dose nothing 3.85 to pay my bill in pounds at the bank surely illigal ppi springs to mind

  • rate this
    +3

    Comment number 207.

    I was a gas engineer on the previous Govs "Warmfront" scheme. It was badly run and far too generous. They sent out sales people to give insulation and HE Boilers to disabled,elderly and benefit claiming home owners. I went to a £1.5m property in Bexley where the owner got a 2yr old boiler taken out "someone told me I could have a new one for FREE"! Taxpayer funded boilers fitted in mansions!

  • rate this
    +4

    Comment number 206.

    Its ok - the MP's and the Royals are NOT affected - just the workers !

  • rate this
    +7

    Comment number 205.

    What needs to happen is for govt to get some b...s and tackle the energy companies who are screwing us, and if necessary take them (utilities) back into state ownership.
    It won't happen of course because David and his pals all have their finger in the pie.
    Whilst Rome burns (no pun intended), David is having dinner at the White House - We Are All In This Together!

  • Comment number 204.

    This comment was removed because the moderators found it broke the house rules. Explain.

  • rate this
    +10

    Comment number 203.

    I am as warm as toast thank you very much.
    I took the precaution of amassing a large number of copies of the Liberal Manifesto from the last General Election.
    These burn rather well releasing large quantities of the hot air it was entirely constructed from.

  • rate this
    +5

    Comment number 202.

    More and more I am ashamed to be British. And some here call our country 'civilised'. Nasty, grasping and self-seeking. The same sort of people who like to think we have Christian principles. What a shower!

  • rate this
    -3

    Comment number 201.

    luls i love the fact that yet again my family and many like mine will get shafted again, because we cant even afford to spend that money to be in fuel poverty, meanwhile the oldies will still get 2 payments to spend on christmas presents and M&S shopping

  • rate this
    +12

    Comment number 200.

    Why when the subjects in the HYS thread are mainly the peasants sick elderley and poor do some post on here that they spend money on fags.booze sky etc instead of fuel NOT ALL DO most are poor for various reasons most are not workshy chavs remember this next time posting remarks slagging others off

  • rate this
    +16

    Comment number 199.

    As each day passes I become more and more sickened by what is happening to this country. I have told my daughter to emigrate when she has completed her degree. My wife and I will be off as soon as we both retire. Good riddance to a country run by and for the large corporations that fleece us on a daily basis.

  • rate this
    +7

    Comment number 198.

    Lots of money for politically correct nonsense while 8 million people live in fuel poverty

    Fascists

  • rate this
    +8

    Comment number 197.

    179.paulmerhaba
    Shareholders are OK, KO


    =>Yup, the energy firms are getting a bit like Goldman Sachs - concerned just to make money regardless of customer hardship. They issue profit warnings and worry that shareholders will buzz off. We all know that their pricing bears little relationship to wholesale prices. We can't win unless they are re-nationalised.

  • rate this
    +2

    Comment number 196.

    The reason energy prices keep rising is that the world has just about reached peak production and maintaining even that is going to keep getting more expensive (possibly massively). Add increased demand from China, India etc and prices will rise relentlessly.
    I agree that insulation etc is needed, but perhaps we need to maybe limit the amount big users consume to moderate prices for everyone else

  • rate this
    +7

    Comment number 195.

    But of course the profits will continue at their obscene levels,never mind we are living under a "Business friendly" Govt and therfore the moral code of business is foremost; greed and devil take the hindmost.It will please the Tories as that is their code as well.

 

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