7. Debate on the Equality and Social Justice Committee Report — Fuel poverty and the Warm Homes Programme

Part of the debate – in the Senedd at 4:15 pm on 21 September 2022.

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Photo of Jane Hutt Jane Hutt Labour 4:15, 21 September 2022

Diolch, Dirprwy Lywydd. I do welcome the inquiry and report from the Equality and Social Justice Committee on fuel poverty and the Warm Homes programme, and thank Members for their contributions in this important debate today.

But the report from this inquiry makes a valuable contribution to the delivery of our programmes and initiatives to tackle the cost-of-living crisis, particularly in the current economic and political climate, and it was a far-sighted decision to undertake this inquiry, and we thank the committee for their evidence, their insights and their recommendations. As your report makes clear, the cost of energy has become increasingly influential in determining the level of fuel poverty in Wales. The energy price increase assault on our living standards has had a devastating effect already on households who are least able to pay. Many can no longer afford the essentials on which we all depend in our everyday lives; the inconceivable cruelty of families not being able to put food on the table or provide basic essentials, such as heating and lighting, in 2022 is hard to believe but is the reality for so many.

Just reporting on some of the actions and many more, of course, that have been brought forward in a statement yesterday by the First Minister, but actions since the report was published on 4 August, I met with Ofgem about changes being made to the frequency of changes to the price cap. And I met Ofgem again on 26 August, with the Minister for Climate Change, the day the October price was announced, and we expressed deep concerns at the price-cap increase to £3,549. The new Prime Minister has taken steps to act upon the concerns we've raised, with the announcement of the energy price, and I look forward to the UK Government's update on Friday. However, we remain concerned—a price cap of £2,500 over two years fails to provide additional targeted support to those who need it most. The UK Government has the financial firepower and moral responsibility to better support householders through this crisis. And we've consistently called for a social domestic energy tariff, set lower than standard tariffs, to better protect low-income households. We've called for a significant increase in the rebate paid through schemes, such as the Warm Homes discount, the permanent removal of all social and environmental policy costs from household energy bills, and for these costs to be met from general taxation, at least part-funded by windfall tax on the excess profits being enjoyed by gas and oil producers.

On 17 February and 11 July, with the support of my Cabinet colleagues, the Ministers for Climate Change and Finance and Local Government, I hosted summits to explore what more the Welsh Government can do to support households through this difficult time. But on 26 May, I also met with energy suppliers, including heating oil companies, to seek assurances that steps are being taken to protect vulnerable households as winter approaches. And we are taking action, investing more than £318 million since October on a range of measures to help those most in need. I've expanded the support available through the discretionary assistance fund to households living off grid, to help with the purchase of heating oil and liquid gas, particularly important for rural communities and raised in this debate today. More than 900,000 households have received their £150 cost-of-living payment this year, and the winter fuel support payment of £200 reached more than 166,000 households. The Welsh Government fuel support scheme is now up and running for this coming winter, and we will be open for applications from next Monday, 26 September.

And I welcome the recommendations from the Equality and Social Justice Committee on the significant Welsh Government cost-of-living initiative. As I said in my response to the recommendations, we are working with the local authorities to ensure that we can reach out and improve that take-up, but also, as Members will know, we have extended the scheme, which means that up to 400,000 households will be eligible. People on child tax credits, pension credits, disability benefits, carer's allowance, as well as contributory benefits and those receiving help from the council tax reduction scheme to pay their council tax bill will now all be eligible for the £200 payment. I know that all partners and, indeed, all Members will play their part to ensure that there is a robust take-up of this scheme. I've written to the Chair of the Equality and Social Justice Committee providing further information on the take-up of the fuel support scheme introduced last year, and I will update that as we get further information.

But, Members will know that we're also funding the Fuel Bank Foundation to expand its network, to offer support to the most vulnerable households across Wales that have to prepay for their fuel. Working with our partners in the Trussell Trust, I was pleased to launch this in Wrexham, where their foodbank had already developed this scheme and also learnt from Blaenau Gwent foodbank, who were already engaged with the initiative. But, the scheme will also provide them with support to top up their prepayment meter or purchase a full tank of heating oil. 

We continue to call for the removal of standing charges from prepayment meter tariffs. As a matter of priority, we're working with stakeholders to make sure that people are aware of the short-term support on offer to help with the immediate crisis. And following the success of the two 'Claim what's yours' campaigns, we have helped people claim more than £2.7 million in extra income, and we will run a third 'Claim what's yours' campaign to help people access all the benefits from Welsh Government, UK Government, and the support that they're entitled to. But, longer term action is needed, as made clear in the recommendations in this report. Improving the energy efficiency of our homes and ensuring that we use only the energy we need to create a decent and safe home is our long-term ambition. Our housing retrofit programmes are based on principles of treating the worst first, on a fabric-first basis, with heating measures designed to deliver a just transition to low-carbon heating for the health and well-being of our people and the planet. 

The consultation outcome report on the next iteration of the Warm Homes programme will be published later this year. The Minister for Climate Change will also publish a written statement setting out how these recommendations will be considered in the next iteration of the Warm Homes programme. And at the same time, we continue to invest in the current Warm Homes programme, increasing its budget by 10 per cent this year to £30 million, with a total investment of £100 million in the current three-year budget settlement. This will support approximately 5,000 households with much-needed free home energy efficiency measures by the end of this financial year. The Nest scheme is also expected to provide free, impartial energy-efficiency advice via the helpline to over 1,600-plus households per year. This will be extended from November with a winter fuel campaign to provide advice and signposting to vital support services, as I've outlined.

Finally, the Nest contract also continues to innovate, and this year has included the installation of solar panels. This will shortly be supplemented with the introduction of battery-storage solutions, which remain recommended through the whole-house assessment. The combination of these two measures will help to mitigate the worst of the recent indiscriminate energy price rises, making the solar energy accessible to households during peak times, when the solar photovoltaics are less efficient. We obviously take other evidence today from the debate in terms of access to the grid.

On behalf of the Welsh Government, I again welcome this valuable report, accepting 21 recommendations in full and two recommendations in principle. Those will be delivered, and we'll seek to implement these recommendations with the importance that they deserve, supporting our collective efforts to respond to the cost-of-living crisis and tackling poverty in all its forms, including fuel poverty. This will also provide sustainable actions in response to the climate emergency.