Fuel Poverty: Scottish Government response to working group reports

Introduction

In 2015, Scottish Ministers established two short-life, expert groups to provide advice and recommendations on tackling fuel poverty; the Scottish Fuel Poverty Strategic Working Group ( SWG) and the Scottish Rural Fuel Poverty Task Force ( TF). The groups were independently chaired by Professor David Sigsworth OBE, former Chair of the Fuel Poverty Forum, and Di Alexander, Chair of the Highlands and Islands Housing Associations Affordable Warmth Group, respectively and made up of representatives from a range of organisations with an interest in energy efficiency and fuel poverty.

Fuel Poverty - current situation

As set out in the 2002 Scottish Fuel Poverty Statement, a household is in fuel poverty if, in order to maintain a satisfactory heating regime, it would be required to spend more than 10% of its income on all household fuel use. Based on this definition, the 2015 Scottish House Condition Survey showed that around 748,000 (30.7%) households were in fuel poverty.

The Scottish Government was statutorily committed to eradicating fuel poverty, as far as reasonably practicable by the end of November 2016. Following the interim recommendations of the Strategic Working Group, Scottish Ministers reluctantly accepted that this target would not be met and informed Parliament in June 2016.

The Scottish Government remains committed to eradicating fuel poverty and, by 2021, will have invested over £1 billion to do so.

Scottish Fuel Poverty Strategic Working Group

As requested by Scottish Ministers, the Strategic Working Group produced a report that outlined the requirements for a new, long-term fuel poverty strategy including recommendations on targets, scrutiny and delivery, addressing all causes of fuel poverty. The report provides a recommended policy direction to improving domestic energy efficiency and the conclusions will have a key role in shaping fuel poverty interests in the development of Scotland's Energy Efficiency Programme ( SEEP). The group also considered how newly devolved powers could best be used to maximise benefit to the people of Scotland.

Scottish Rural Fuel Poverty Task Force

The creation of this short life working group was one of the action points contained in the Joint Delivery Plan for Housing in Scotland, which was discussed at the Scottish Housing Event in November 2014. The Task Force considered and reported on the specific issues that affect fuel poor households in rural and remote rural Scotland, and developed a set of actions which would make it easier and more affordable for people in rural Scotland to keep their homes warm. Recommendations from the Task Force will also inform the development of future fuel poverty policy and funding schemes.

Publication of Fuel Poverty Reports

On 24 October 2016, both groups published their final reports; A Scotland without fuel poverty is a fairer Scotland: Four steps to achieving sustainable, affordable and attainable warmth and energy use for all; and An Action Plan To Deliver Affordable Warmth In Rural Scotland.

The Strategic Working Group report noted the considerable investment by the Scottish Government into tackling fuel poverty, but highlighted that these efforts had failed to eradicate the problem. The Group therefore concluded a fresh approach to tackling fuel poverty was needed, aimed at delivering the outcome of affordable warmth and energy use for all in Scotland. The Group's report set out four high-level principles on which this new fuel poverty strategy should be based:

• the new strategy should be based upon the principle of social justice and embedded in efforts to create a fairer and more equal society;
• it should address all four drivers of fuel poverty including how energy is used in the home;
• it should promote a strong collaborative approach with strong national and local leadership; and
• the current definition of fuel poverty should be reviewed, alongside developing a new reporting and monitoring mechanism to ensure the new policy objective around fuel poverty is adequately monitored.

The Strategic Working Group report provides detailed recommendations on how these broad principles could be taken forward in the Scottish Government's new fuel poverty eradication strategy. Their recommendations include both short and longer term actions to alleviate fuel poverty; create local employment opportunities; and help develop a more secure and affordable energy supply. The Strategic Working Group recognised that this is an ambitious agenda that will require a new way of collaborative working, but emphasised that this should lead to more effective outcomes.

The Rural Fuel Poverty Task Force report sets out three fundamental guiding principles which it recommends should form the basis of an affordable warmth delivery strategy:

• Fairness and social justice should be every householder's right, irrespective of whether they live in urban or rural Scotland;
• All vulnerable households should receive the most effective practical help and support to keep their homes warm at a cost they can afford;
• The Scottish Government's approach to fuel poverty eradication should be set on a statutory framework for delivery which is rigorously measured and held to account annually by the Scottish Parliament.

The Task Force also set out its top strategic priorities, including setting a defined timescale for the eradication of fuel poverty with clear targets and milestones and giving priority in programme delivery to off-gas grid areas. The Task Force advised that robust monitoring should be put in place to ensure success is tracked and to ensure those in greatest need are receiving the support they require. The Task Force called for the Government to fund an 'Energycarer' pilot to test the effectiveness of home-delivered advice and support to those who need it. Support to help households switch suppliers and the provision of price comparisons for all fuel types were also seen as important actions in tackling rural fuel poverty, among others.

The Scottish Government agrees with the overarching principle set out by both working groups, that there should be a new fuel poverty strategy, including a new statutory target. We will develop the strategy and target in collaboration with stakeholders, using the two reports and their guiding principles as our starting point, and consult on them in the autumn this year. The outcome of that consultation will inform the development of our new Warm Homes Bill, which we plan to introduce
in 2018.

The reports contain collectively over 100 detailed recommendations, many of which, understandably given the same general subject matter was being considered, address similar issues. While the majority of the recommendations are for the Scottish Government to take a lead on, a significant number are for other bodies, including the UK Government, Ofgem and energy suppliers. As the recommendations in both reports cover many of the same issues, rather than provide a detailed response to each individual recommendation, we have identified six key themes across the 2 reports and used these to structure our response:

• a new fuel poverty strategy;
• incomes of householders;
• making energy affordable;
• energy performance of homes;
• using energy more efficiently; and
• accountability and scrutiny

For each theme we set out a summary of the recommendations, current activity and future actions.