The number of households estimated to be suffering fuel poverty by the government belies the true hardship caused by rising fuel prices for millions of the UK’s poorest people, Consumer Focus has warned.
Although it has not provided figures for the rest of the UK, statistics released by the Department of Energy and Climate Change indicate that 4.1m households in England will suffer fuel poverty this year, just 100,000 higher than the figure for 2010 and 2009.
But Audrey Gallacher, director of energy at Consumer Focus, said these predictions are likely to be an underestimate as four of the big six energy providers have yet to announce expected price increases. “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,” she said.
“Increasing energy costs create hardship for millions of the poorest pensioners, families and disabled people, leaving many cutting back on heating or other essentials. It is an issue which cannot be left on the backburner.”
A household is deemed to be fuel poor if it needs to spend more than 10% of its income on fuel to maintain an adequate level of warmth, heat water and power lights and appliances.
The DECC said that although recent price increases announced by British Gas and Southern Power have been factored into the figures, and some price rises will have an impact on households in the latter half of 2011, it will be 2012 before the full impact of these are visible in the fuel poverty data.
The latest “actual” fuel poverty figures rather than estimates are for 2008/09, when there were 5.5m fuel poor households in the UK, up from 4.8m in 2008. Northern Ireland had the biggest proportion of households – 43.7% in 2008 – suffering fuel poverty, followed by Scotland with 32.7% in 2009, Wales, 26.2% in 2008 and England 18.4% in 2009.
These included 4.5m vulnerable households, which contain older people, children or someone who is disabled or long term sick and are up by 500,000 from 2008.
Gillian Guy, the chief executive of Citizens Advice said the fuel poverty figures meant at least 5.5 million people in the UK were already living in freezing conditions through self-rationing and disconnection – with tenants in the private rented sector among those at highest risk of fuel poverty.
“Since the start of the recession CABs have seen a big increase in people coming for help because they can’t afford to pay their gas and electricity bills – last year alone we advised on over 100,000 fuel debt problems. It is vital that the government now commits to meeting the statutory target to eliminate fuel poverty by 2016.
“Living in a cold home has a devastating impact on people’s physical and mental health. With energy prices continuing to rise the government urgently needs to take action to improve the energy efficiency of people’s homes so that they are cheaper to heat.
“As 42 per cent of tenants in the coldest privately rented homes live in fuel poverty, we are calling on the government to use the energy bill currently going through Parliament to make it an offence to let or re-let a property with an energy efficiency rating lower than an EPC band ‘E’ by 2016.”
Consumer Focus would like to see energy suppliers offer more competitive deals that are not paid for by direct debit or only available online, as low income groups tend not to benefit from such offers. It has also called on the government to recognise the higher proportion of income spent on energy by low income households when up-rating benefits and tax credits.
Gallacher added: “Help must be better targeted at those who need it the most through the energy supplier energy efficiency schemes. Given the scale of the problem, however, these schemes alone are not enough to tackle it.”
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