Chancellor Rachel Reeves delivered the new government’s first budget on Wednesday 30th October, the end of a month when the average energy bill rose by 10% with the Ofgem price cap.
In this context, with winter fast approaching, it was a crucial moment for the government to show how it will tackle the ongoing energy bills crisis and protect UK households from cold damp homes.
The Chancellor confirmed investment in energy, as well as announcing an “initial” £3.4 billion over three years to make 350,000 homes more energy efficient through the Warm Homes Plan. This includes a bigger share for the last government’s Boiler Upgrade Scheme in the next two years, and £1.8 billion for fuel poverty schemes. This was a welcome start, but it is just a fraction of the £13.2 billion promised for the Warm Homes Plan, desperately needed to upgrade the UK’s heat-leaking housing stock and bring down energy bills for good. It is now vital that the government commits to further funding in the spring’s spending review.
It was also deeply disappointing that there was no mention of further support for households with their energy bills this winter, despite soaring levels of energy debt, persistently high costs, and the cut to universal winter fuel payments for pensioners. However it was good to hear that the Household Support Fund was extended for another year.
Warm This Winter spokesperson Caroline Simpson said:
“The Government has done a lot to move us on from energy price shocks in the future with the clear commitment to clean energy.
“But while £3.4 billion is a welcome first instalment on the Warm Homes Plan, it is only the start of the journey.
“We desperately need to see a full £13.2bn turbo charge to the Warm Homes Plan and a 10 year strategy to keep people warm every winter through better housing and energy efficiency.
“For those suffering in cold damp homes now - especially those with disabilities, heath conditions and who have lost the Winter Fuel Payment - the majority of voters also want to see help now.
“In fact 75% of the public say there should be financial help for older and disabled people to pay their energy bills. The public also think the wider energy sector, who have made £457 billion in profits since the start of the energy crisis, should pick up the tab for a new social tariff.
“We urge the government to look at this as a way forward.”
A spokesperson for the End Fuel Poverty Coalition, commented:
“The only way to bring down bills permanently is through investment in insulation, home improvements, renewables and infrastructure which will free us from volatile gas prices forever.
“But after the Chancellor’s speech, uncertainty remains whether Ministers will be able to confirm the £13.2bn promised to help people improve their homes.
“And despite the Chancellor taking Winter Fuel Payments away from millions of older people with disabilities and health conditions, there was no support for vulnerable households with their energy bills now.
“The increase to the Household Support Fund announced today is essentially an extension of the current Fund through to the end of March 2026 at the same level as under the last Government and with no adjustment for inflation.
“And with more older people turning to the Fund, local authorities will find it stretched even further.
“What we needed to see in the short term was a restoration of winter fuel payments, an expansion of warm home discounts and reforms to improve and extend cold weather payments.
“Longer term, the Chancellor also needed to commit to a social tariff providing a unit rate discount on energy alongside existing support.”
Ellie Mae O’Hagan, UK Energy Programme Leader for E3G said:
“The initial £3.4 billion announced over three years for retrofitting homes will provide industry with welcome investment certainty but is well short of the Labour Manifesto pledge to invest £13.2 billion over the Parliament.
The door has been left open to boost this investment in the Spending Review due in the Spring. This must now be delivered so that Britons can get the warm homes they deserve.”
National Energy Action Chief Executive Adam Scorer commented:
“This Budget will not lessen the impact of unaffordable energy bills and record levels of energy debt this winter. With likely increases to energy bills later in January, things will remain bleak for some of the most vulnerable households across the UK.
“A longer-term Warm Homes Plan designed to help fuel poor households is more vital than ever. A downpayment is welcome, but we need the full detail and investment promised in the Labour manifesto.”
Mike Childs, head of policy at Friends of the Earth, said:
“This budget was the first significant opportunity for the Labour government to demonstrate it will invest to get the UK back on track for meeting our rapidly approaching climate and nature recovery targets. Regrettably, it has largely failed to do so.
"It should have committed to significant increases in funding for nature restoration, invested the £6 billion per year needed to insulate cold homes instead of a paltry £1.1 billion a year, and kept the £2 cap on bus fares, as these measures would help those on the lowest incomes and deliver much needed environmental improvements. Remarkably, the government has found money to squander on nuclear power, despite it being a financial nightmare. The Hinkley C plant is £20bn over budget and running 14 years late.
"While in opposition, the Labour Party promised £28bn a year in green investment because it understood this would bring economic growth, create jobs, and make life better for people facing sky-high energy bills and woeful public transport provision.
"Introducing a wealth tax on the super-rich, and significantly increasing the windfall tax on polluting oil and gas companies - which this budget failed to do - would go a long way to funding the fair, green measures we so desperately need. Today's announcement falls staggeringly short of what's needed to address climate and nature emergency.”
Warm This Winter will keep campaigning for a social tariff and to make sure we get the full £13.2 billion desperately needed to insulate our homes and make them energy efficient alongside the transition to renewables so we can bring down bills for good and end the reliance on oil and gas profiteers.
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