Fuel Poverty

Alan Whitehead Excerpts

Thursday 8th July 2021 Commons Chamber

[Dr Alan Whitehead (Southampton, Test) (Lab)]

I, too, welcome the opportunity to talk about the whole question of fuel poverty. It is very helpful that an annual debate is required in Government time so that we can get to the bottom of the issues. We certainly need to, because as the Minister mentions, 3.2 million households in England, or 13.4%, are still in fuel poverty. I might add that that is under the new metric that the Government have introduced over the past year, along with their document “Sustainable warmth: protecting vulnerable households in England” and the updated fuel poverty strategy. Unlike in a number of other areas, the Government do appear to have a strategy on fuel poverty now, which is a good step forward. It is based on some changes in methodology and hence in the slant of a number of commitments on fuel poverty that the Government have made for the future.

Of course, as the Minister has mentioned, we should not in any way underplay the significance of what has happened over the past year. The pandemic has probably driven a substantial number of additional households into fuel poverty because people have been staying at home, using more energy and paying a lot more in energy bills. That effect is likely to continue for quite a long while, so there are several factors to consider in thinking about where we are now with fuel poverty and where we want to go.

One of the key changes that has been set out this year is a change in the definition of fuel poverty—what it consists of and how it is measured. I was a little surprised when I first heard that Lord Lilley, the former right hon. Member for Hitchin and Harpenden, had come up with a definition of fuel poverty, but that is not actually the low-income, low energy efficiency definition set out in the strategy. What is important about the new definition is that it explicitly includes a metric involving property banding in England. Property bands have not been specified in a definition before, although they have been in the Government’s ambitions for 2030; the Minister mentioned the target to get the properties of as many people in fuel poverty up to band C as possible.



Although that may not seem like an enormous difference, I think it is a really fundamental change inasmuch as it explicitly recognises for the first time that a very substantial element of fuel poverty is not just income, although that is very important, and is not just energy prices, although they too are very important, but is actually the energy efficiency of the properties people are living in and how bad that may be. Indeed, we know that there is a very considerable correlation between income, for example, and the kind of properties that people who have a low income—well below the median rate—are living in.

That correlation is very clear for the bands of properties people are living in. Indeed, we can see from the calculations of what a household bill is likely to consist of that that is a tremendous problem for people who have a low income. For example, an average band C property will have an estimated energy bill of about £600 a year. Go to band D and that figure is £900, but band E is £1,400, which is double or more the band C level. Worse than that, go down to band F and band G, and it gets to treble or more the band C bill. Those people who are in fuel poverty, with a lower income and less able to pay bills, are by and large facing much larger bills in the first place because of the nature of the property they are living in. The strategy essentially puts a much greater emphasis than hitherto on getting those properties into a fit state for people to live in so that their bills are such that fuel poverty is essentially written out by the energy efficiency of the properties the people are living in.

The recognition of that particular metric does, however, lead to very substantial and grave policy implications and commitments for the future, because what the Government are essentially saying is that they are going to get to average band C by 2030 to drive fuel poverty out in the way I have described. The judgment we have to make now is: are the Government in a position right now to actually fulfil that particular ambition in order to carry out the fuel poverty strategy they have set their mind on over the next period? My suggestion right now is that they are clearly not.

The Minister has, in a slightly Panglossian way, set out a number of commitments that will lead to the strategy being achieved by 2030, but they are mostly short-term strategies and mostly strategies that are poorly funded. In one instance, a strategy was mentioned in the poverty strategy itself:

“Invest in energy efficiency of households through the £2 billion Green Homes Grant, including up to £10,000 per low income household to install energy efficient and low-carbon heating measures in their homes”,

but it actually disappeared just a month after it was set down in the fuel poverty strategy as one of the key drivers as far as the energy efficiency of homes are concerned. This is the green homes grant system that, as the Minister has acknowledged, got into terrible difficulties. It was, frankly, a pathetic attempt at investing £2 billion in energy efficiency in homes and needs to be recovered and revised very rapidly.

In that context, it is a shame that this debate comes just before the Government’s heat and buildings strategy is to be published. I understand that it is to be published shortly, but we are still on the wrong side of it. What I am looking for in that strategy is a coherent plan—not just a few bits and pieces here and there—for building an efficiency strategy right through the next decade, so that when we get to 2030, band C is the median for all properties. That will require a large amount of investment, and thinking of new ways to undertake changes in energy efficiency through bodily uprating the energy efficiency of properties throughout the whole country. It will also mean concentrating on those sectors—particularly the private rented sector—where we know that band D, E and F properties are concentrated, and having a coherent strategy to tackle the very low energy efficiency of such properties across the country.

I hope that in the heat and buildings strategy the Government have not given way to the pressure I know there has been in respect of ensuring that landlords in the private rented sector have a greater responsibility for bringing their properties up to a decent level of energy efficiency. Many of those who are in fuel poverty live in the private rented sector, sometimes in appalling conditions yet faced with enormous bills that they simply cannot afford, as part of their income, normally to discharge.

There is now a great onus on the Government to come forward with an energy efficiency strategy that meets the commitments made in the fuel poverty strategy from February onwards and to give a convincing account of how that strategy is to be met. Of course, I think all Members would agree that that is not the whole issue as far as fuel poverty is concerned; the question of income and what one does about that as far as benefits and assistance are concerned remains very important. That is also important in terms of the effect of the new strategy on people who are objectively in fuel poverty but happen to live in properties that are band C or above.

Several hundred thousand people have been knocked off, as it were, the fuel poverty concern radar by the LILEE—low income low energy efficiency—definition that came in this year. Those people’s circumstances have not objectively changed—they are in exactly the same position as they were—but the new definition has moved them out of a particular category. I hope that that particular section of the population will not be forgotten as a result of the new strategy. They would clearly need to be approached in different ways in terms of vulnerability measures, some of which the Minister outlined. We should not think that because we have changed the definition, we have somehow solved fuel poverty for that group of people.

We need to continue with a three-pronged approach to our fuel poverty targets: yes, we need energy efficiency; yes, we need to consider incomes and to make sure that people have the income to pay the bills in the first place; and, of course, we need to consider energy prices themselves. We have not yet had through the results of the energy price cap considerations for this year—I think that they, too, will come out shortly—but I hope that when they come out they will be relatively good news for those people who face increasing bills, year on year, as they struggle to try to meet their warmth and home energy commitments on low incomes and in the badly insulated homes that we all hope will be, by 2030, very much a thing of the past.

[Mr Deputy Speaker (Mr Nigel Evans)]

This is a time-limited debate, but we will try not to put a time limit on individual contributions, so I ask for restraint, please.

--- Later in debate ---

[Dr Whitehead]

We have had an excellent debate that is absolutely up to the mark as regards the requirements of the fuel poverty legislation. The debate has underlined the human cost of fuel poverty. Contributions from my hon. Friends the Members for Lewisham East (Janet Daby) and for Coventry North West (Taiwo Owatemi) emphasised that to tremendous effect, as did my hon. Friend the Member for Liverpool, West Derby (Ian Byrne). We always need to remember that at the heart of the fuel poverty debate is the human misery and suffering brought about by it. We need to strive with all our might to remove it as a stain on our country in the 21st century; we could do so much better.

We also heard from the hon. Member for Southend West (Sir David Amess), who was at the heart of it when fuel poverty issues were first debated many years ago. Indeed, I have been alongside him debating those issues for quite a while myself. He must be grievously disappointed by the glacial progress being made on the elimination of fuel poverty in our country.

The Minister has heard a universal contribution from all Members here this afternoon that the Government must do better. I look forward to the new policies that are coming forward, which I hope will give a clear indication of just how the Government are going to do better, because they are a long way away from closing the gap between ambition and action and putting that into operation. I am sure we will debate the matter on frequent occasions in the future, but I look forward to those strategies. I hope they will be up to the mark in doing what we now know we need to do on fuel poverty in all its aspects. Perhaps from this afternoon’s debate we can bring out a renewed vigour to get on with it.