Challenge to fuel poverty policy

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The government needs to revamp its strategy for helping people pay their fuel bills, a think tank claims.

The recent cold weather has underlined the need for more urgent help to deal with fuel poverty, the Institute for Public Policy Research (IPPR) says.

This is defined as where someone spends more than 10% of their household income on heating their homes.

In November the government said up to 4.6 million households in England could have been in this position in 2009.

The government has a long-standing vow to end fuel poverty in England by 2016.

But the problem has become more acute in recent years, largely because of big increases in domestic fuel bills and the onset of the economic recession.

Unfit?

The centre-left IPPR said the government's various measures to help people meet emergency fuel needs, and its longer-term strategy to reduce fuel poverty, were "not fit for purpose".

Everyone knows this is a really tough issue David Kidney, Energy Minister

The think tank's report said the existing winter fuel and cold weather payments, energy efficiency schemes, and energy price support programmes were "not sufficient to deal with the growing problem of unaffordable fuel costs".

The IPPR said the continued problem of fuel poverty contributed to the deaths of 36,000 people last winter - 49% more than in 2007-08.

"During this bitter cold snap, the obvious thing to do is to turn up the heating at home," said Lisa Harker of the IPPR.

"But sadly, the proportion of people in this country who cannot really afford to do that is now rising again."

The IPPR's proposals include:

• prioritising energy efficiency measures like insulation over financial assistance with paying fuel bills

• making the most of technological innovations such as smart meters, micro-generation technologies and community-scale heating.

'Tough issue'

At the moment an Energy Bill is going through Parliament which will require energy companies to contribute at least £300m a year towards financial support for their poorest customers by 2013-14.

"The latest government legislation puts greater emphasis on the energy companies helping low-income households, but this in itself will not be enough," argued Ms Harker.

"We need a new, far-sighted fuel poverty strategy, which ensures that wealthier households pay their fair share, and that sustainable energy saving measures are prioritised," she added.

The government says it has already handed out £261m in cold weather payments to about 4.2 million recipients this winter, along with £2.7bn in winter fuel payments to 12.3 million older people.

"In the future, we are requiring energy companies to offer more of their most vulnerable customers money off their bills," said Energy Minister David Kidney.

"But everyone knows this is a really tough issue, that there is more to do and that's why we are reviewing our fuel poverty strategy."

The number of households in fuel poverty in England last year was up sharply from just 1.2 million in 2004.

Across the UK as a whole, the number of fuel-poor households rose from 3.5 million in 2006 to four million in 2007.