Warm Home Discount

Sarah Newton Excerpts

Tuesday 25th March 2014 Westminster Hall

[Sarah Newton (Truro and Falmouth) (Con)]

It is a great pleasure to serve under your chairmanship, Sir Edward. I am pleased to have secured this debate about the warm home discount. Along with the energy company obligation, the warm home discount is a key tool for tackling fuel poverty.

The Government have a good track record in bearing down on heating bills. According to the House of Commons Library—I am grateful for the note that it has prepared for the debate—the Government are doing much more than the previous Labour Government to help people in fuel poverty. Although considerable effort has been made to keep heating bills down this winter, with particular help for pensioners and other groups of vulnerable people and with an estimated 2 million homes receiving the warm home discount, we must do more to stop people of all ages living in cold homes.

There is a particular group of people whom we must do more to help. Across Great Britain, off-mains-gas customers make up at least 11% of the total population, but that proportion varies wildly by region. Just under half of all homes in Cornwall are off the mains gas system, and a much greater proportion than the national average lives in detached homes, which, as we all know, are difficult to insulate. Dual fuel deals offer the best value, but they are just not available to off-mains-gas homes. The alternatives—bottled gas, oil, biomass or electricity—all cost much more than mains gas. The Government are to be applauded for setting up a ministerial working group to find new ways of supporting off-mains-gas households. It is already making some really positive differences. I apologise for my croaky delivery; I am trying to fend off a cold.

There is a wide range of measures that we can all take to save money heating our homes. It is important to ensure that people know about the help that is available, such as energy-efficiency measures, oil-buying clubs and cash benefits, but that is sometimes much more difficult to do than we might think. The winter wellness partnership in Cornwall is working well to tackle that problem, joining up voluntary sector organisations, the NHS, Cornwall council and rented housing providers to deliver warmth to cold homes, and at the same time improving people’s health and well-being. With more financial support allocated from growing public health budgets to the winter wellness partnership, much more could be achieved and more people enabled to live in warm homes next winter.

Greater use of data matching by Government to enable energy companies to target help where it is most needed will also help to heat more homes. Recent analysis by the Department of Energy and Climate Change and the Department of Health suggests that warming up cold homes will prevent ill health that costs the NHS an estimated £15 million a year. In addition, there is research to show that warming up cold homes where children live could enable them to do better at school and help to close the academic attainment gap.

In the medium term, money is being spent in Cornwall on improving the insulation of homes and extending the mains gas grid, as well as exploring the feasibility of local renewable geothermal heat networks. For next winter, targeting cash benefits to people who need them most can also help. The £135 warm home discount, which will rise to £140 this winter, is available for low-income and vulnerable households. At the moment, low-income pensioners are eligible to be part of the core group for the warm home discount. The Department for Work and Pensions and DECC will match their details against those held by different energy companies to determine which energy company they are with, after which the relevant energy company will be notified of its eligible customer and instructed to apply the warm home discount to their electricity bill. The discount is, therefore, applied automatically for core group customers, including those off the mains gas grid.

The approach for low-income families with children is very different, however. Instead of having their details automatically matched and the discount applied, families have to check their circumstances against their energy company’s eligibility criteria, which vary considerably between suppliers, and apply to have the discount applied to their bills. The decision over whether to apply the discount is at the energy company’s discretion. About half of eligible families do not receive the discount, probably because they do not know about it, or, as Community Energy Plus, a leading fuel poverty charity based in Cornwall, has said, because energy companies do not always inform potentially eligible customers about the discount and because people are often put off by the forms that they have to complete to get it. The energy companies say that it can be difficult and expensive to find non-core group customers to help.

I have decided to support the Children’s Society campaign, which asks the Government to treat low-income families with children in the same way as low-income pensioners by having fixed eligibility criteria that apply across suppliers; by automatically identifying eligible families with children through data matching, rather than relying on families to apply; and by requiring energy companies to apply the discount to families who meet the eligibility criteria, rather than allowing that to be discretionary. An estimated 120,000 homes in the south-west would be helped by those changes. That is a lot of children who could be helped.

The Government are planning to consult in the coming months on how the warm home discount will be applied from 2015. I hope that the proposals I have outlined for using data matching and automatic payments can be considered to target financial help better to those who most need it, and to improve the health and well-being of many children. I also hope that as part of the consultation the Minister will consider representations that I and others have made about enabling park home residents and tenants of private sector landlords whose heating costs are paid by their landlords to benefit from the warm home discount as well. Those groups of people are often living in fuel poverty and would otherwise meet the criteria, and they would benefit enormously from the discount. I appreciate that the Government have given us helpful feedback on the points that we have made regarding those groups.

The Government have done a great deal to help people keep warm and well during the past winter. I hope that, through the consultation, we can build on that and ensure that even more people are helped in 2015 and beyond by the warm home discount.