Opinion Former Article

NEA: Government support for heating and insulation to end this week

As temperatures plummet, fuel poverty charity NEA is urging the Government to step back from ending insulation and heating grants for vulnerable people struggling to afford their energy bills.

NEA is calling on the Government to urgently reconsider its decision to close the Warm Front scheme from January 19. From this date, England will be the only UK nation without any Government-funded programme to assist the most financially disadvantaged vulnerable households in keeping their homes warm. The scheme, which provides grants for heating and insulation improvements for low-income households, will be replaced by a new scheme funded by a levy on energy bills – adding to the burden of rising energy bills for those least able to afford them. In total, expenditure on energy efficiency schemes to protect the health and welfare of vulnerable households will be less than half of the financial support available in 2010-2011.[1]

Ron Campbell from NEA said: ‘From the 19th January England will be the only UK nation providing no Exchequer-funded support to enable vulnerable and financially disadvantaged households to improve heating and insulation standards in their homes. In stark contrast, Scotland, Wales and Northern Ireland have all continued to maintain, or even expand, their tax-funded energy efficiency programmes. With the numbers of households in fuel poverty reaching crisis level, we remain seriously concerned at the loss of the Warm Front programme.

‘The health and wellbeing of thousands of very vulnerable households is being put at risk, and we urge the Government to urgently bring forward  a new fuel poverty and energy efficiency programme funded through the VAT and other taxes the Government receives from energy bills and the energy sector.’ 


[1] From 2013 the Energy Company Obligation will provide annual funding of around £540 million to assist fuel-poor households; in 2010-2011 a combination of Warm Front and Energy Supplier Obligations provided support in the region of £1.1 billion.


END

Notes
1.    National Energy Action (NEA) is the national charity which aims to eradicate fuel poverty and campaigns for greater investment in energy efficiency to help those who are poor and vulnerable

2.    In answer to a parliamentary question from Caroline Flint MP, Labour’s Shadow Energy and Climate Change Secretary, the Government confirmed that the budget for this year’s Warm Front scheme is £100m. Of this just £34.8 million has been spent. A further £15.1 million has been committed but not yet spent, meaning that £50.1 million is predicted to remain unspent

3.   The most recent official Government statistics, based on 2010 data, put the total number of households living fuel poverty in England at 3.5 million. More recent estimates suggest that there are actually around 5.3 million households in England in fuel poverty (CSE/Consumer Focus Now Cast data)

 

For further information please contact Sarah Wright, Senior Campaigns and Communications Officer, NEA on 0191 269 2942 / 07884371913. Email sarah.wright@nea.org.uk

 


Background on the Warm Front and the successor scheme:

Since 2000, when the Home Energy Efficiency Scheme was re-branded as Warm Front, with substantial additional funding and the introduction of heating measures to supplement insulation works, the scheme has formed a major element in fuel poverty policy. In subsequent years, expenditure on the scheme continued to increase as did the level of the maximum grant. Over the period 2008-2011 total finding for Warm Front reached £1.1 billion and the programme was assisting some 230,000 households each year.

Since the scheme’s inception more than £2.5 billion has been expended on assisting more than 2 million households.

Eligible applicants to Warm Front currently receive a grant of up to £3,500 or up to £6,000 awarded to those off the gas-grid. The grant can pay for measures such as insulation (loft, cavity wall, hot water tank lagging, draughtproofing) or other more extensive measures such as gas, electric or oil heating systems.

As part of the Spending Review 2010, the Government announced a significant reduction in total funding for Warm Front to £100m in 2012/13. Following Government consultation, the scheme’s eligibility was revised with effect from April 2011. Eligibility is now based on a combination of income-related benefits, mirroring those used to identify Cold Weather Payment recipients, and the thermal efficiency of the applicant’s property.

The operational processes of the Government’s Green Deal and the Energy Company Obligation (ECO) have recently been finalised. The ECO is likely to result in a significant reduction in funding for fuel poverty programmes compared with previous practice. From 2013, annual expenditure on these heating and insulation programmes will reduce from the 2010-2011 level of £1.1 billion to around £540 million. As with the reduction of funding to Warm Front, limited funding through ECO will also restrict the total number of households receiving support through the programme. This issue is anticipated to be most acute in England. 

The ECO will be funded through a consumer levy and all consumers will pay regardless of their income. From 2012/13 all Government-mandated programmes to address fuel poverty in England will be funded through levies on consumer bills. In the context of fuel poverty, NEA has emphasised that this approach is both regressive and perverse. By spreading the cost across all energy consumers, there is a disproportionate adverse impact on the most financially disadvantaged. Funding for the ECO will be raised in this way. Those households that do not take up measures (or are unable to) will see their bills increase; while those taking up measures (including measures subsidised for comparatively affluent households) will see their bills decrease.





Sarah Wright
Senior Campaigns and Communications Officer
NEA


Level 6 (Elswick)
West One
Forth Banks
Newcastle upon Tyne
NE1 3PA

Tel: 0191 269 2942
Mob: 07884371913
Email: sarah.wright@nea.org.uk
Web: www.nea.org.uk

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