NEA: Government fuel poverty initiatives are welcome but inadequate

National Energy Action (NEA), the leading fuel poverty charity, has welcomed aspects of today’s Ofgem and Government fuel poverty action plan, but fears the measures announced will prove inadequate in the context of escalating fuel prices and 4.5 million UK households currently suffering fuel poverty.

Over the past ten years the Government has made significant progress in tackling fuel poverty only to see this progress largely reversed as a result of unprecedented energy price rises since 2004. In 1998 there were 4.75m UK households in fuel poverty and today in 2008 there are 4.5m, yet progress had been made with fuel poverty having fallen to 2 million households by 2004.

Maria Wardrobe, NEA Director of Communications, said: “Much of the good work by Government to fight fuel poverty has been undone by high energy costs. This is particularly disappointing as real progress had been made. In ten years the situation has gone from bad to good to increasingly ugly and things look likely to worsen if speculation about further drastic price increases in the summer proves to be accurate.

“This action plan at least confirms continuing Government commitment to fuel poverty targets. The priority of better-targeted help to low-income households could prove beneficial, but NEA has strong reservations about providing sensitive information about vulnerable households to commercial organisations. If there is a way for data sharing to incorporate safeguards to protect privacy then this could be effective in reaching fuel-poor households.

“Also the Government must be congratulated for recognizing the important role that micro-generation can play in tackling fuel poverty. NEA trials of air-source heat pumps have shown that winter fuel bills can be cut by more than half in areas off the gas network. If 100% grants are provided to enable disadvantaged households to benefit from this technology then thousands of people could be taken permanently out of fuel poverty.

“However, we are disappointed that Government continues to ignore recommendations from its own advisory group, FPAG, and from NEA both of which are demanding longer-term, sustainable and better-resourced policies to address.”

NEA is calling for:

Reinstatement of the Warm Front budget - Energy efficiency is still the most cost effective way to reduce bills yet expenditure on this flagship Government scheme has been slashed by 25%

Extending the Winter Fuel Payment – this presently only assists a certain social group – over 60s – but at a cost of £320 million it could be extended to the poorest households with young children or where disability or long-term illness is a factor. This would bring significant benefits to the 1.6 million households affected.

Mandatory social tariffs - the Government should legislate to introduce minimum standards for social tariffs to ensure consistent eligibility criteria and consistent benefit to households qualifying for the tariff.

The Government must make sure companies offer their poorest and most vulnerable customers their lowest tariff regardless of how they pay for their bills.

Maria Wardrobe, added: “The measures recommended by NEA would take thousands of households out of fuel poverty and help mitigate the damage that has been done through rising energy bills. The Government has again missed the opportunity to address this problem in a serious and constructive manner. We need serious resources and serious political will to get the UK Fuel Poverty Strategy back on track.

Ends

Notes to editors:

1. NEA is the leading fuel poverty charity campaigning for affordable warmth in the homes of vulnerable people. Visit www.nea.org.uk

2. Fuel poverty is defined as the need to spend over 10% of household income on fuel costs to maintain adequate warmth for health and comfort.

3. A 1% rise in energy prices forces 40,000 households into fuel poverty.

4. Since 2003 domestic gas charges have increased by more than 90% and charges for electricity in excess of 65%.

For more information contact David Bootle, NEA Press Officer on 0191 2615677, or david.bootle@nea.org.uk or call 07984993579.