Fuel Poverty

Stuart Blair Donaldson Excerpts

Tuesday 24th November 2015 Westminster Hall

[Stuart Blair Donaldson (West Aberdeenshire and Kincardine) (SNP)]

Does my hon. Friend agree that the Government’s policy of encouraging customers to switch is completely useless for many of my constituents, as it is for many of his constituents? In some parts of my constituency 80% of local tenants are on dynamically teleswitched all-electric systems, which can be provided by only one fuel supplier. That, coupled with the 2p per kilowatt-hour surcharge, demonstrates that we need a real and practical solution for those in fuel poverty in rural areas of Scotland.

[Drew Hendry]

I completely agree with my hon. Friend that we need a more equitable solution that takes people out of situations in which they have limited choice, or no choice at all. Later, I hope to propose at least a partial solution for the future, but we need action now, too. That must be taken on board. As I said, fuel poverty is not unique to people in the highlands and islands. In the past year, a third of those who are already struggling have skipped a meal to try to afford their bills; 20% are suffering from stress or mental health issues because of fuel poverty; and 40% are struggling with other essential bills.

As the Chair mentioned, I took part in an openDemocracy forum yesterday with MoneySavingExpert.com. The issues raised in that forum, and in subsequent emails to me, were common with those of my constituents in many cases. Highlanders are mostly off the gas grid, which they have in common with some 4 million households across the UK. If people are unable to gain access to the grid, they have to rely on alternative energy sources, including heating oil, liquefied petroleum gas, electricity and solid fuels. The average cost of heating a three-bedroom house with heating oil is circa 50% higher than the UK average; those using LPG pay 100% more on average than those with mains gas. There is limited opportunity to switch to other alternatives. In Scotland, people living off the gas grid are more than twice as likely to be living in fuel poverty as those with mains gas.

The Scottish Government have put in £0.5 billion since 2009 to introduce a raft of fuel poverty and energy efficiency programmes. Uniquely, they have brought into being the Scottish rural taskforce, with which I recently had the pleasure to interact, to find ways of making it easier and more affordable for people in rural and remote areas of Scotland to heat their homes. In 2015-16, an unprecedented £119 million has been allocated to fuel poverty and energy efficiency measures, split between advice and support services for householders through the “home energy Scotland” network and a variety of home energy efficiency programmes—HEEPs. Since 2008, nearly one in three of all households has had energy efficiency measures put in place. The Scottish Government have done more to help than the UK Government and other devolved Administrations, with Energy Action Scotland’s report from 2013-14 showing that the average energy savings are £36.48 in Scotland, £31.31 in Wales, £27.55 in Northern Ireland, and £3.52 in England.

There are some issues that could be addressed. For a start, the off-grid energy sector is not covered by Ofgem or the energy ombudsman, which is a deficit that could very easily be rectified. As my hon. Friends have mentioned, there should be a fairer pricing structure across the UK that removes the inequality and prevents people from being charged more in the coldest and darkest areas.

Measures could be taken on prepayment meters, which routinely charge people more than other billing methods. The forthcoming roll-out of smart meters offers an opportunity to give homeowners and constituents meaningful advice about how to use them, and the UK Government should also consider ensuring people can switch seamlessly from one supplier to another through the smart meter, without having to make an application. It should happen automatically to give people the lowest possible tariff. Wholesale prices should be passed on immediately by the energy companies to consumers as fuel savings. There should not be a delay.

A ComRes poll to be published tomorrow for the No Cold Homes campaign showed that 81% of people think that the UK Government should do more on fuel poverty, and 82% of people surveyed believe that the energy sector should do more. Tomorrow, the Chancellor will have an opportunity to take measures to increase household incomes by abandoning tax credit cuts. Austerity is not working for people. The cost of poverty through austerity is more misery. The solution to poverty is not to push those closest to the edge into further crisis. It is time to dump the failed dogma of austerity and turn to a path that focuses on the outcome of a fairer and healthier society.