Campaigners warn Chancellor: warm homes in danger of becoming luxury item for worst-off
21.03.06

The escalating cost of gas and electricity is blighting the lives of millions of families and the Government must do more to boost the incomes of households in fuel poverty, Chancellor Gordon Brown has been warned by some of the UK’s leading charities.

The Child Poverty Action Group, End Child Poverty, the Disability Alliance, Help the Aged and Age Concern, Citizens Advice and National En ergy Action have united with consumer champion energywatch in calling for more support to help families on low incomes.

The call comes in a letter to Mr Brown in advance of the 2006 Budget. It says: “The advent of the £1000 annual average energy bill is changing a warm home from a basic necessity to a luxury item for the worst off.”

The charities say that between 1996 and 2003, rising incomes were the major factor in the reduction of fuel poverty. They add that the Government has taken a number of key measures to alleviate fuel poverty.

But with predictions of 3 million fuel poor households by the end of the year – double that of 2003 – the crisis is reaching a level not seen since the 1990s.

Since 2003 average domestic energy bills have risen by 63.3 per cent for gas and 44.2 per cent for electricity, slamming the Government’s own commitment to eradicate fuel poverty by 2010 into reverse, say the organisations.

The letter to Mr Brown says that it is beyond question that “the unprecedented cost of energy is leaving increasing numbers of households suffering the daily misery of cold, damp homes.” Families on low incomes and disabled people are as badly affected as vulnerable pensioner households, the letter states. Average annual energy bills of £1,000 would absorb:

• 42 per cent of the after housing income of a single pregnant woman aged 18-24 dependent on Income Support
• 16 per cent of the income of a single pensioner dependent on the pension credit minimum guarantee and the £200 Winter Fuel Payment
• 44 per cent of the Disabled Child Element of Working Tax Credit

The letter, signed by all the charities and energywatch, adds:

“While we recognise that the government is committed to tackling this social ill, and that the twin strategies of energy efficiency and central heating provision are the correct long-term measures for achieving this, there is a clear need to provide immediate respite to make warmth affordable. This can only be achieved through raising the incomes of vulnerable households.

“We are not prepared to accept that adequate warmth should be put further beyond the reach of the poorest in society in the 21st century. We urge you to demonstrate that the Government shares this sentiment and announce, in Wednesday’s Budget, measures to improve the income levels of those otherwise condemned to the cold.”

Kate Green, Chief Executive of the Child Poverty Action Group, said: “Recent hikes in domestic energy prices have put even more pressure on the budgets of families with low incomes. Parents with young children should not have to decide between putting on the heating and putting food on the table. If further action is not taken to help the poorest in society meet the growing cost of energy bills, then more and more families will face this dreadful choice.”

Allan Asher, Chief Executive of energywatch, said: “The fuel poor have to spend 10 per cent or more of their income on fuel. So it is self-evident that they are already on low incomes and struggling to make ends meet. The Government needs to fill that gap and stop the most vulnerable in society being forced to choose between heating or eating.”

Lorna Reith, Chief Executive of Disability Alliance, said. "Many disabled people have high fuel costs because of their disability. People with limited mobility get cold easily and conditions like arthritis are exacerbated by damp. High fuel costs are a direct threat to the health of disabled people."

William Gillis, Chief Executive of the NEA, said: “NEA urges the Chancellor to provide additional financial assistance to the 4 million households in the UK who are in fuel poverty until the Government can guarantee all homes are well insulated with efficient heating systems.”

Caroline Abrahams, Chair of the End Child Poverty Campaign, said: "As part of our campaign to end child poverty we recognise the importance for children’s health and well-being that they live in an adequately heated home. Growing up in a warm home should not be a luxury their parents can’t afford."

David Harker, Chief Executive of Citizen’s Advice, said: "Millions of those who can least afford it are already paying more for their fuel because they have little option but to use expensive pre-payment meters. Spiralling fuel charges mean an increasing proportion of people's benefit income will have to go on paying for fuel. For some, if they are to both heat their homes and eat, it will mean debt collectors down the line, with all the additional costs, stress and worry that brings. For the many households already facing problem debt and over-indebtedness this will add significantly to their financial strain."

Michael Lake CBE, Director General of Help the Aged, said: "Last winter more than 30,000 older people died as a result of cold-related illnesses – a figure that could rise even further this year as fuel poverty increases. No pensioner should be forced to choose between heating and eating. Gordon Brown must boost pensions in his Budget and cut back on means-testing of benefits, while at the same time making a warm home something all older people can afford."

Gordon Lishman, Age Concern's Director-General, said: “With the £200 winter fuel payment now covering only 22% of the average fuel bill compared to 35% in 2003, spiralling fuel bills are particularly hard hitting for many pensioners who live on a low, fixed income. It is vital that the Government addresses the income difficulties of pensioners and other groups at risk and avert the looming fuel poverty crisis. The Government should increase the state pension to at least £114 so that pensioners have enough money to cover basic living costs such as heating their homes.”

Notes to Editors:

1. For further information please contact:

• CPAG: Alex Belardinelli on 020 7812 5216 or 07816 909302
• Energywatch: Georgina Walsh on 07734 884426
• NEA: Jenny Saunders on 07703 346666 or David Bootle on 07984 993579
• Disability Alliance on 020 7247 8776
• End Child Poverty: Laura Payne 0207 278 6745 or 07929 125 589
• Help the Aged: Paul Bates Senior Press Officer DL on 020 7239 1941 07730 912524
• Citizens Advice: Moira Haynes 020 7833 7107 or 07790 019116
• Age Concern England: Emma Hayes on 020 8765 7515

2. CPAG is the leading charity campaigning for the abolition of poverty among children and young people in the UK and for the improvement of the lives of low-income families.

3. energywatch is the independent gas and electricity consumer watchdog. We provide free, impartial information and advice to energy consumers who are experiencing difficulty in resolving complaints directly with their energy supply companies.

4. The Fuel Poverty Advisory Group estimates that around two million vulnerable households in England are in a fuel poverty trap and nearly £1bn more up to 2010 is needed to help them (FPAG 4th Annual Report).

5. The Government has committed an extra £250m for its Warm Front energy efficient homes scheme and has widened eligibility to the scheme. The £200 Winter Fuel Payment covered approx 35 per cent of the average annual energy bill in 2003. It now covers 22 per cent.

For further information please contact:
Alex Belardinelli
CPAG Press Officer
Tel. 020 7812 5216 or 07816 909302
abelardinelli@cpag.org.uk