Fuel poverty hits 1m more homes

14 July 2011 Last updated at 14:27 GMT Tina Watkin says 'I'm worried about putting the heating up'

More than a fifth of all households in the UK were affected by fuel poverty in 2009, government figures have shown.

Higher fuel bills meant the number of homes affected rose by one million, or 22%, to 5.5 million, the Department of Energy and Climate Change said.

A household is described as being in fuel poverty when it has to spend more than 10% of its income keeping warm.

DECC predicts that the numbers for 2010 and 2011 will have increased because of further rises in the price of energy.

"Between 2004 and 2009, energy prices increased: domestic electricity prices increased by over 75%, while gas prices increased by over 122% over the same period," DECC said.

"This led to the rise in fuel poverty seen over this period," it added.

The Climate Change Minister, Greg Barker, admitted the figures were unacceptable.

He blamed past Labour policies and the state of the UK's housing.

"The fact is that homes in the UK are amongst the most expensive to heat in Europe yet we don't have the most expensive gas and energy prices," he told BBC Radio 4's You and Yours programme.

"Next year [we start] the most ambitious home improvement since the second world war, where we're not just putting a bit of lagging in people's lofts, but [will] transform on a whole house basis, millions of homes over next decade."

Rising prices

Before 2004, the problem had been in decline, with fuel poverty across the UK dropping from 6.5 million homes in 1996 to just under 2 million in 2003.

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The overall effect of price rises since 2004 has far outweighed the impact of increasing incomes and energy efficiency”

End Quote DECC This had been driven by the combined effect of rising incomes and falling energy prices.

Despite increased effort and money being put into insulating homes to make them more energy efficient, DECC admitted that the benefit of these initiatives was being swamped by steeply rising fuel prices.

"The overall effect of price rises since 2004 has far outweighed the impact of increasing incomes and energy efficiency," DECC said.

Recently, both British Gas and Scottish Power have announced further price rises and other energy suppliers are expected to follow them soon.

As a result, DECC warned that an increasing number of households were now at risk of falling into fuel poverty.

Audrey Gallacher from Consumer Focus says there needs to be more competition for the big six providers.

It estimates that in England another 100,000 households will have been pushed below the threshold, taking the number to 4.1 million by the end of this year, out of a total of 21.5 million homes.

But the official consumer body, Consumer Focus, said this was likely to be an underestimate.

"Four of the Big Six have yet to announce their expected price rises," said Audrey Gallacher at Consumer Focus.

"If these are in line with the increases announced from British Gas and Scottish Power around 12 million people, or 6.4 million British households, are likely to be in fuel poverty when the latest price rises hit."

'Scandalous'

Most of the fuel-poor homes are "vulnerable", defined by the government as ones containing the elderly, children, or someone who is disabled or suffering from a long-term illness.

In England for instance, this broad category covers the majority (71%) of homes.

Michelle Mitchell, charity director at Age UK, said the increasing problem of fuel poverty was "scandalous".

"Almost half of people living in fuel poverty are aged over 60," she said.

"Help for fuel poor households through the Warm Front scheme is being phased out and the promised solutions contained in Green Deal don't come into force until late 2012 - too late for the millions of people struggling to heat their homes this winter."

Derek Lickorish, chair of the government's own fuel poverty advisory group said: "Despite such welcome initiatives as the Warm Homes Discount and the potential for the Green Deal, the scale of the fuel poverty challenge dwarfs the assistance that is likely to be available."

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Fuel poverty level 'unacceptable'

1 July 2011 Last updated at 08:30 GMT The council said rises in energy prices meant part of the fuel poverty problem was outwith its control The scale of fuel poverty in Dumfries and Galloway has been described as "unacceptable" by councillors.

It is an issue which affects an estimated 41% of all households in the region compared with 28% nationally.

Families spending more than 10% of their income on energy bills are classed as living in fuel poverty.

There are concerns that council efforts to tackle the issue could be undermined by further price increases by the utility companies.

Housing sub-committee councillor Alistair Geddes said it was an appalling situation and action was needed.

"I think quite frankly it's a wholly unacceptable position," he said.

"We are constantly told that the gap between the haves and have-nots is widening and here is a classic case in point.

"I think at the end of the day we have got to mobilise public opinion and put pressure on our elected representatives to say to these people who are continually hiking the fuel costs - enough is enough, we are not prepared to accept any more."

Market forces

The percentage of households classed as living in fuel poverty equates to almost 26,500 homes.

The council, as part if its new five-year local housing strategy, has set a target of reducing that figure by 20%.

Head of Housing John Lynch said the strategy was largely based on helping householders improve energy efficiency, but admitted they were vulnerable to market forces.

"The issue of fuel poverty and the ways to solve it are not entirely within the gift of the local authority," he said.

"There are certain things that we can do but there are lots of things that we can't control.

"The primary issue there is fuel costs."

However, he said the council was working on a range of measures to try to do what it could to address the situation.

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