Pension Age Winter Heating Payment (PAWHP): consultation

Section 3 – Policy Objectives of Pension Age Winter Heating Payment

The Scottish Government intends to deliver a like-for-like benefit, which means continuing eligibility for all those who have previously been eligible for a WFP. The main objective of PAWHP is to provide all older people with additional money during winter which will allow them to heat their homes for longer, helping to tackle fuel poverty. Older people are targeted because they may be particularly vulnerable to the effects of cold weather during the winter months^[2] and are more likely to be on fixed incomes.

Ensuring financial security in older age was a key priority identified in ‘A Fairer Scotland for Older People: framework for action’ published by the Scottish Government in 2019. This strategy affirmed that whilst remaining in paid employment for longer will clearly support this aspiration, for many older people, financial security depends on ongoing access to pension funds (both state and private) and a range of other financial benefits and measures. As such, tackling pensioner poverty in the short term will primarily be the result of action to tackle costs of living and to maximise incomes from social security and benefits in kind.

PAWHP will form part of a suite of winter benefits which includes CWHP, which provides additional support to households of the most severely disabled children and young people, and WHP which is targeted at low income households, including people of pension age who are in receipt of Pension Credit.

The Scottish Government are taking a number of actions to support older people.

Local government have been provided in excess of £350m in 2023-24 to deliver the Council Tax Reduction (CTR) Scheme, ensuring over 450,000 households receive some level of Council Tax Reduction and on average recipients save over £750 a year. Data shows that 165,820 CTR recipients were aged 65 and over as of March 2022, with the entitlement of 89,250 of these recipients passported by Pension Credit Guarantee Credit. Older People also receive free bus travel, Pension Age Disability Payment is set to pilot in Autumn 2024, ahead of national rollout in 2025,

and can also benefit from wider energy efficiency and retrofit schemes such as those laid out below:

Area Based Schemes

Our Area Based Schemes (ABS) have helped over 108,000 fuel poor households to benefit from warmer homes that are less expensive to heat since 2013. Local ABS schemes are designed and delivered by local councils, in conjunction with utility companies and local delivery partners. Local schemes target communities facing high levels of fuel poverty to provide energy efficiency measures to a large number of Scottish households.

The Scottish Government is maintaining our investment of £64 million in ABS this year. ABS funding allows local delivery partners to offer energy efficiency measures at no cost or a reduced cost to owner occupiers and private landlords with no more than 3 properties (grant-in-kind). Typically, this includes insulation (fabric first) but since 2021 the ABS programme has been extended to include heating, microgeneration and battery storage.

Warmer Homes Scotland

The Warmer Homes Scotland programme offers funding and support to households struggling to stay warm and keep on top of energy bills. It is designed to help people make their homes warmer and more comfortable by installing a range of energy saving improvements. The primary objectives of the Warmer Homes Scotland programme are to support households in, or at risk of, fuel poverty through the heat transition and to remove poor energy efficiency as a driver of fuel poverty for these households.

The programme was refreshed and re-launched in October 2023 to significantly expand on the offer available with a greater focus on deep, whole-house retrofit and zero direct emissions heating where this is not detrimental to fuel poverty objectives.

Home Energy Scotland Grant and Loan Scheme

The Home Energy Scotland Grant and Loan Scheme offers homeowners in Scotland a grant, interest free loan or combination of both to support the installation of zero emissions heating and energy efficiency measures.

For zero emission heating measures, grant funding of up to £7,500 is available, with an additional £7,500 of funding available as an interest free loan.

For energy efficiency measures, grant funding of up to 75% of the combined costs of measures up to a maximum £7,500 is available, with an additional £7,500 of funding available as an interest free loan.

There is a rural uplift of £1,500 for both the zero emission heating and energy efficiency grants for rural and island homes, meaning rural households can claim up to £18,000 in grant funding.

Fuel Insecurity Fund

We have invested £30 million in our Fuel Insecurity Fund for 2023/24 which can provide support to anyone at risk of self-disconnection, or self-rationing their energy use. Eligibility does not depend upon receipt of benefits, or income thresholds, allowing our delivery partners the flexibility and discretion to provide support on the basis of an holistic assessment of people’s needs.

Support is primarily provided to people either as fuel vouchers, or via direct payments to their energy suppliers. Assistance can be provided regardless of what kind of tariff a household is on, or what type of fuel they use for their heating. This is particularly important because we know that many consumers in remote and island areas of Scotland live off the gas grid and rely upon heating oil, or other kinds of solid and liquid fuels, which have increased substantially in price. Delivery partners can assist not only with purchase costs for these types of fuel, but can also help with arranging deliveries to remote locations.