NEWS RELEASE
Date: 2 October 2008
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Fight must continue on fuel poverty say ministers
Ministers today said that they will continue with their fight against fuel poverty, as Environment Secretary Hilary Benn holds meetings with energy suppliers and the home insulation industry to discuss how to speed up work on increasing energy efficiency in the UK’s homes.
The pledge comes as Defra and BERR jointly published the Sixth Annual Progress Report for the UK Fuel Poverty Strategy, and follows the recent announcement of a £1 billion Home Energy Saving Programme to increase fuel efficiency and help for vulnerable households.
Environment Secretary Hilary Benn said:
“Since that announcement the Government has launched a major advertising campaign to encourage energy efficiency and advise people of the assistance available. This has resulted in almost 57,000 calls to our Act on CO2 helpline in the fortnight since the announcement. This is triple the number of calls normally received, so clearly people are responding to rising fuel bills.
“Today I met with energy suppliers and the home insulation industry to stress the need for all of us to work together as fast as possible to make more homes energy efficient, and to discuss with them the opportunities for bringing forward insulation activity so the maximum number of people are able to benefit this winter.”
Today’s report includes details of the progress of the Fuel Poverty Strategy, presents the statistics on fuel poverty in the UK for 2006, and provides an update on government policies and programmes to tackle the issue.
Key findings of the report include:
- The rise in the number of households in fuel poverty during 2006 was due to increases in consumer energy prices. The overall cost of energy to domestic consumers rose by 22 per cent in real terms between 2005 and 2006, with gas prices rising by 29 per cent and electricity prices rising by 19 per cent.
- In 2006 there were approximately 3.5 million households in fuel poverty across the UK, an increase of one million households since 2005. Of these, around 2.75 million households were classified as vulnerable. A vulnerable household is one that contains an elderly person, a child or someone who is disabled or suffering from a long term illness.
- In England, for 2006, there were estimated to be around 2.4 million fuel poor households, of which 1.9 million were vulnerable. This represents an increase of 900,000 households, including an additional 700,000 vulnerable households since 2005.
Hilary Benn said:
“This Government is committed to tackling fuel poverty but - as this report shows – sharply rising energy price rises have made this goal increasingly difficult. However, we should remember that much has already been achieved. Since 2000, the Government has spent £20 billion on fuel poverty benefits and programmes. For example, the Warm Front scheme has provided cavity wall insulation to over 400,000 properties; loft insulation to 600,000 properties; new gas central heating to around 150,000 properties; replaced gas boilers in over 220,000 properties; and repaired over 70,000 central heating systems.
”Under the new programme funding to Warm Front is up by £74 million, cold weather payments are up from £8.50 to £25 a week this winter, and we are proposing that energy companies increase their spending on their energy efficiency obligations by 20 per cent. Programmes are in place, funding is available and we will continue to do everything we can to help people save money and save energy, both this winter and for the years ahead.”
Energy Minister Malcolm Wicks said:
"It is the global demand for energy that is pushing up prices, but that is no comfort to the fuel poor who need support. That is why the Prime Minister launched the substantial energy efficiency package last month; it is why we have required supply companies to improve social tariffs and it is why winter fuel payments for elderly people will increase substantially later this year. It is intolerable that the vulnerable could suffer this winter. The Government is not complacent. We need to take action on many fronts."
Also published for the first time as part of the report is a detailed statistical annex which provides comprehensive analysis of the 2006 figures, and projects forward the position for fuel poverty in 2007 and 2008.
Hilary Benn met with energy suppliers in London this morning, followed by a meeting with representatives from the home insulation industry in Coventry at noon.
Notes to editors
- The report can be access via the Defra website - www.defra.gov.uk/environment/climatechange/uk/household/fuelpoverty/ and also at http://nds.coi.gov.uk/environment/berr/
- On 11 September the Government released details of its £1 billion Home Energy Saving Programme, which provides assistance to householders to make their homes more energy efficient. For households most vulnerable to fuel poverty, including pensioner households, the programme provides help with their bills this winter through the winter fuel payments and lower energy company tariffs. More details of the programme are available at www.defra.gov.uk/news/2008/080911a.htm.
- Energy prices are a key driver of fuel poverty. Overall energy prices in 2006 were much higher in real terms than at their very low point in 2003, with gas prices rising by around 50 per cent and electricity prices by around a third. All six major suppliers to the household electricity and gas markets announced reductions in tariffs in the first or second quarter of 2007, as a result of the falling wholesale gas prices over the previous six to nine months. However, prices rose in early 2008 by an average of around 15 per cent for gas and 13 per cent for electricity. Subsequently, they rose again during the summer of 2008, by an average of around 30 per cent for gas and 14 per cent for electricity.
- The CERT (Carbon Emissions Reduction Target) scheme, which came into effect on 1 April 2008, doubled the previous obligation on energy companies to help people make their homes more energy efficient and reduce household carbon emissions. The Government announced on 11 September that it will propose that the investment target of £2.8 billion over three years is increased by 20 per cent, or £560 million. In addition, the new Community Energy Saving Programme will propose a further investment of around £350 million by energy companies. The total energy companies contribution will therefore be more than £3.7 billion between now and March 2011.
- A household is considered to be in fuel poverty if it needs to spend 10 per cent or more of its income to maintain an adequate level of warmth (usually defined as 21 degrees for the main living area, and 18 degrees for other occupied rooms.)
End
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Page published: 2 October 2008