10. Short Debate: Supporting people in a cost-of-living crisis

Part of the debate – in the Senedd at 7:15 pm on 25 January 2023.

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Photo of Jane Hutt Jane Hutt Labour 7:15, 25 January 2023

However, there's now evidence that suppliers aren't following the basic rules to protect people in vulnerable circumstances. Again, Jack, you referred to the Citizen's Advice evidence. From September to December last year, more than three times the number of people were moved onto a prepayment meter for debt compared to the same period in 2019. Front-line advisers consistently see evidence of people in vulnerable circumstances being moved onto prepayment meters, in breach of energy supplier regulation. So, they are in breach. We need to look at those regulations, and that's what I'm going to do. These practices continued even after Ofgem wrote to suppliers in November to remind them of their obligations. Ofgem also published a report on Monday outlining its concerns about the sharp growth in households struggling to pay their bills being switched over to prepayment meters, sometimes without their even knowing about it, as we know, leaving them without heating. 

National Energy Action Cymru has highlighted the case of the magistrates' court that approved 496 warrants to install prepayment meters in just four minutes. Who are these magistrates? We must go to them. We must address this with them. Such practices risk vulnerable customers, including those with medical conditions, being forced onto prepayment meters when this could be unsafe. Approximately 200,000 households in Wales rely on prepayment meters for their mains gas and electricity. This represents about 15 per cent of all our households. Twenty-four per cent of tenants in the private rented sector use prepayment meters, and almost half of social housing tenants rely on prepayment meters.

Welsh households were amongst the hardest hit by the increase in the standing charges being applied to household bills from last April. The highest increase in Britain was in north Wales, up 102 per cent, with south Wales witnessing standing charges up 94 per cent, the fourth highest in Britain. These additional costs to already rising fuel bills have had a disproportionate negative impact on low-income households and those on prepayment meters in particular. Citizen's Advice has highlighted record numbers of people who can no longer afford to top up their prepayment meters, including disproportionate demand from single-adult households, women and disabled households. There's no doubt that placing a customer on a more expensive tariff when they're already struggling to pay is disconnection by the back door.

You know of the Welsh Government's range of initiatives that we've put forward and that we're implementing to keep homes warm this winter. The one I want to particularly just focus on is the Fuel Bank Foundation partnership, which has so far helped 14,377 people who are struggling to prepay for their fuel and were at risk of self-disconnection. The fuel voucher scheme has resulted in 5,500 vouchers being issued to help top up prepayment meters. People struggling to pay for their off-grid fuel have also received support.

So, as I have done this afternoon, I'd take this opportunity to again urge Members to use their social media to encourage constituents who have a traditional prepayment meter to use their vouchers from the UK Government scheme. There is a 90-day expiry limit, and a worryingly large number are outstanding. But, I was also assured by energy suppliers on Monday that they would reissue those vouchers. I'm going to hold them to it, so they reissue those vouchers until people receive those vouchers. It's only 72 per cent at this time, for that £400, which is vital to the poorest in Wales. 

So, you know that we have our fuel support scheme already reaching 310,000 households with the £200 payment this year, increasing eligibility. I'd again urge eligible households, this financial year, to ensure they apply for this vital support, because this is crucial in terms of getting money into people's pockets. Our current funding allocation from the UK Government isn't sufficient for us to repeat the scheme in 2023-24, but we will lobby UK Ministers to provide further financial support for people during this difficult time. And we have also ensured that our discretionary assistance fund is there, with an increase, as you know, in the draft budget, to access emergency financial help in a crisis.

We continue to call on the UK Government, which holds the key levers for tackling poverty, to put in place practical actions that have an immediate and positive impact on those affected by the rising cost of energy, particularly those on prepayment meters. And we have called—and I'm sure that you will join me today—in calling for the removal of standing charges for prepayment customers. That hopefully could be another statement of opinion. For two years, we've called on UK Ministers and Ofgem to introduce a social tariff to protect the most vulnerable households. They are now saying that they will look at this. I'm meeting Ofgem shortly. Most of the energy suppliers I met this week were moving towards being in support of this. We have got to call for that social tariff together.

So, finally, thank you to Jack Sargeant, a tireless advocate and campaigner. I pay tribute to Jack for his determination. He's put this matter in the headlines not just here in Wales, but widespread across the UK. You've highlighted the detrimental impacts that the forced change to prepayment meters has had for vulnerable households. You've galvanised political and public support for proper checks to be undertaken in every case before switching a customer to prepayment. And you've repeated calls to Ofgem and the UK Government to ban the forced installation of prepayment meters, and I have backed all those calls, Jack, and it's so good to hear that our colleagues from Plaid Cymru and Welsh Liberal Democrats are backing the calls as well. So, you did make a difference last weekend—we've got to recognise that Jack Sargeant did have an influence. Grant Shapps wrote to UK energy suppliers this weekend, restating their duty under the regulations to protect vulnerable customers struggling to pay their bills. But that's not strong enough, that's not good enough. We've got to look at those regulations to see what we can do, and we have to ensure that we take these calls and this campaign forward together. Thank you very much. Diolch yn fawr, Jack.