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Social Justice

Up to 1.5 million fuel poor households don’t qualify for the warm home discount

Plans to expand the energy discount scheme could see millions of excluded fuel poor homes subsidising better-off households who do qualify for it, experts say.

Up to 1.5 million households struggling with fuel poverty do not automatically qualify for the Warm Home Discount on their bills, according to the Committee on Fuel Poverty (CFP).

The CFP made the comments in response to a government consultation, pointing out that almost half – 46.1 per cent – of households currently in fuel poverty are not in receipt of benefits, and thus don’t qualify for an automatic discount. 

It comes amid the UK’s ongoing energy crisis, with millions of households facing higher costs to heat their homes this winter. 

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The End Fuel Poverty Coalition has already said the energy crisis and gaps in current support schemes mean that “millions will be facing fuel poverty” in the coming months. 

Currently, the warm home discount (WHD) offers automatic reductions of up to £140 on energy bills during the winter for those receiving pension credit. 

For others on low incomes, the discount is only available via certain energy suppliers on a first-come, first-served basis. 

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To qualify, most energy suppliers require an applicant to be in receipt of certain benefits. 

Meanwhile, figures from the Department for Business, Energy and Industrial Strategy, (BEIS) reveal just 37 per cent of current recipients of WHD are fuel poor. 

The BEIS consultation on the scheme has proposed to continue basing automatic eligibility on receipt of benefits, while the costs of delivering WHD to more households will be shouldered by increasing energy bills for ordinary payers.

The CFP said it was “extremely disappointed” at the proposal to continue basing automatic eligibility on receipt of benefits, given that almost half of fuel poor households will not qualify. 

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It added that plans to expand the scheme by raising energy bills were “fundamentally unjust” for these households.

“Although living in fuel poverty, 1.5 million households will have their energy bills increased by £19 per year (£28.5 million per year in total), in order to provide WHD’s to other recipients, most of whom are in less need of assistance,” it wrote in the consultation response.

A CFP spokesperson said:  “We continue to urge the government to adopt our recommendation to focus the warm home discount programme on those most in need by making better use of government data to identify and assist all households in fuel poverty.”

Simon Francis, co-ordinator of the End Fuel Poverty Coalition accused leaders of “silence” on helping the millions of households now facing higher energy bills and ineligibility for support.

He said: “While there seems to be plenty of political support for subsidies for high energy use firms, there is silence on supporting the millions facing fuel poverty this winter.

“Of course there is a balancing act to play between calling for an increased payments and extending the scope of existing schemes.

“But we know there is a crisis facing the country this winter and so in addition to extending existing schemes, additional short-term energy debt relief measures will be needed,” he said.

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A government spokesperson said: “Protecting households’ bills across the UK is a key priority, which is why the Business Secretary has been clear that the Energy Price Cap will remain in place this winter, and we are continuing to support vulnerable and low-income households further through initiatives such as Winter Fuel Payments and Cold Weather Payments.

“We have also already set out plans to extend the Warm Home Discount until 2026, as well as increasing it to £150 to help an extra 780,000 households.

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