Pension Age Winter Heating Payment (PAWHP): consultation analysis

Executive Summary

Background

The Scottish Government has committed to introducing the Pension Age Winter Heating Payment (PAWHP) in winter 2024/25. This will be a like-for-like replacement for the UK Government’s Winter Fuel Payment (WFP). A public consultation on PAWHP ran between 23 October 2023 and 15 January 2024 to gather views on the proposals for a like-for-like transfer of the benefit, the eligibility criteria, and the value, form and timing of the payment. In total, 906 consultation responses were received from 881 individuals and 25 organisations.

Overall views on PAWHP

Over half (55%) of respondents who answered agreed with the proposal for a like-for-like replacement; 28% disagreed, and 17% were unsure. Four fifths (79%) of organisations that answered supported the proposal. The most prevalent theme in open responses was agreement with a like-for-like replacement. The second most common theme, among respondents who disagreed or were unsure at the closed question, was a view that the current system for WFP works well and should not be changed, particularly if the replacement is intended to be the same. Many individuals raised concerns about the competence or trustworthiness of the Scottish Government to manage the payment, while several questioned whether the replacement would be truly like-for-like.

Almost three fifths (59%) of those who answered agreed that the proposed approach is effective, though a quarter (25%) disagreed. Very high levels of support were recorded among organisations who answered, with 89% agreeing. Many felt the proposed approach effectively addressed fuel poverty among older people or reiterated the difficulties older people face paying energy bills. Several respondents described the approach as fair, helpful, smooth, efficient, and sensible.

Views on the proposed name for the payment were mixed. Overall, 44% of those who answered agreed with Pension Age Winter Heating Payment, and 40% disagreed. The most prevalent theme in open comments was that many respondents felt the name was clear, straightforward, easily understood, and accurately described the benefit and the target audience. Conversely, many individuals felt the benefit's name did not matter, and many suggested the name was too long or confusing.

Timing of the payment

There was strong support for payments in November and December; 87% of those who answered agreed. The most prevalent theme in open comments was agreement that this is the most appropriate time to make the payment. Respondents highlighted that this is when the weather becomes colder, more heating is required, and energy bills increase. Conversely, several advocated an earlier payment date; October was the most frequently mentioned month. Arguments for this approach included that the weather becomes colder in Scotland earlier than elsewhere in the UK and that an earlier payment would allow people to budget and buy solid or liquid fuel in advance when they are often cheaper. Some individuals suggested making the payment after New Year or splitting the payment over two or more months.

Eligibility criteria

Four fifths (80%) of all who answered, including 81% of organisations, agreed with the universal approach to eligibility. Respondents commented that the state pension age is when people need additional support or that the criteria seemed fair and sensible. Many argued a universal approach is fairer, avoids discrimination, promotes uptake and meets everyone’s basic need to stay warm. Many argued that eligibility based on state pension age is easy to understand, avoids complicated form-filling for clients, or is cost-effective and efficient. However, many highlighted other people under the state pension age who could benefit from additional support with heating costs, including veterans, those with disabilities or health conditions, unpaid carers, and people living in poverty.

Three fifths (61%) of those who answered agreed that the eligibility criteria are clear, including 94% of organisations. Many described the criteria as clear, straightforward, or easy to understand. Several argued that this was the case because they are the same as the WFP eligibility criteria. The second most common theme was that the eligibility criteria are unclear or need to be made clearer. Several respondents stated they were confused about the criteria, or highlighted groups that might find the criteria too complicated.

When responding to questions about eligibility, the potential of means testing PAWHP was raised by respondents, who expressed a range of views. Several argued against means testing PAWHP. Reasons included that it was unfair to those who had made provision for their older age, that it was costly and complex to administer, and could cause some people to miss out on a payment. However, several other individuals, including a mix of those who agreed or disagreed with the closed question, advocated for some form of means testing of PAWHP to be introduced instead of or in addition to age-based criteria. It was frequently argued that not all older people need financial support.

Value of the payment

Varied views were expressed on the payment value, with just over half (56%) of those answering agreeing with retaining the current value; 28% disagreed and 16% were unsure. While a majority of respondents agreed with retaining the current value at the closed question, the most common theme in open comments was that the payment should increase as the cost of fuel and energy increases. Many others argued that the payment value should increase with inflation or the cost of living. In contrast, many agreed with retaining the present value of the payment, describing it as fair, sufficient, and helpful.

One third (37%) of those who answered agreed that people in residential care who do not receive one of the listed income-related benefits should receive half the ‘full’ rate of PAWHP; 31% disagreed and 32% were unsure. A slightly higher proportion (42%) agreed that people in residential care who do receive one of the income-related benefits listed should not receive PAWHP; 25% disagreed and 33% were unsure. Most commonly, respondents expressed a view that people in residential care should not receive PAWHP as heating is already covered in their care costs. Similarly, several agreed that care home residents should not receive PAWHP if they already claim other income-related benefits. Conversely, several argued that those in residential care should receive some of or the full rate of PAWHP to help cover their care costs.

Many respondents felt that receipt of PAWHP, or the amount awarded, should depend on individual circumstances of those in residential care. Several suggested it should depend on how the costs of residential care are being met, advocating that self-funding residents should receive the full payment. The importance of keeping the benefit universal was highlighted by several.

Receiving the payment

Almost three quarters (74%) of those who answered agreed with a cash payment, rising to 94% of organisations. While many individuals disagreed with a cash payment in the closed question, their comments suggest they did support the proposal. Those who elaborated suggested that a cash payment was simple and efficient, reducing confusion and bureaucracy. However, payments directly into clients’ energy accounts were suggested by many individuals. Some suggested that the client should decide the payment method.

The proposal to pay PAWHP as an annual one-off payment recorded the highest level of agreement in the consultation. Among those who answered, 88% were in favour. In their open comments, many respondents focused on the timing of the payment, rather than whether it should be a one-off payment, noting that winter is when a payment is needed most due to colder temperatures, greater demand for heating and higher bills. Many others agreed because they felt a one-off payment is the most efficient way to administer PAWHP and because this is how the WFP payment is currently made. Several agreed with a one-off payment as they felt it provided a predictable source of income.

Over three fifths (64%) of those who answered agreed with the proposals for opting-out of PAWHP, while 16% disagreed; agreement was higher among organisations (76%). The most prevalent theme in comments was support for an opt-out option. Many combined the question about an opt-out option with whether PAWHP should be universal or means-tested, and expressed views for and against both an opt-out and means testing.

Qualifying week

Overall, 71% of those who answered, including 82% of organisations, supported having a qualifying week in September. While open comments most frequently repeated support, several highlighted that people with birthdays after September would not be eligible for the payment that year, regardless of the fact that they would be of state pension age during the winter. The most prevalent theme among those who disagreed was that there should be no qualifying week and that eligibility should be assessed throughout the year. However, several acknowledged that a qualifying week was necessary.

Re-determination timescales

Over half (58%) of those who answered agreed with the proposal that clients should have 31 days to request a re-determination. Fewer than one in ten (9%) disagreed, though one third (34%) were unsure. Suggestions for longer re-determination periods of varying lengths, ranging from 31 days to 6 months, were proposed by some. Mixed views were evident on the proposal that Social Security Scotland should have a period of 56 working days to consider a re-determination. Overall, 40% of those who answered agreed with this approach. One quarter (27%) disagreed, and one third (34%) were unsure. Many expressed a view that the proposed 56 days for Social Security Scotland to respond to a re-determination was too long.

Remote rural and island communities

When considering what support in addition to PAWHP could be provided to remote rural and island communities, many respondents offered a range of suggestions for promoting alternative fuels or approaches to alleviate fuel poverty in these communities. Calls for a higher value, earlier or more flexible payment was also a common theme. However, another prevalent theme, raised by many, was that the value and delivery of PAWHP should be no different in these areas than in the rest of Scotland.

Future developments

The consultation also gave stakeholders an opportunity to express their views on how PAWHP could be made more effective in the future. The most prevalent theme was to keep the benefit universal. Fears were expressed that, over time, means testing could be introduced. Several called for the payment value to rise in line with inflation or rising fuel costs. Others called for targeting funds used for PAWHP to particular groups, rather than a universal approach, or to extend the benefit to other groups.

Impact Assessments and other impacts

When considering the impact of PAWHP on groups who share protected characteristics, those who commented typically felt there would be no impact, stated that all should be eligible for PAWHP, or highlighted groups with specific characteristics. Most frequent were comments suggesting people with disabilities or health conditions, particularly those made worse by cold temperatures, could benefit from PAWHP or should be given additional support to reflect their higher energy costs.

It was felt there would be little impact on businesses, with a few stating that as PAWHP was for individuals, it should not affect businesses. Potential impacts on care homes were mentioned by some, while some others noted impacts on energy companies, for example, that they could benefit as PAWHP would help customers pay their bills promptly.

Several respondents stated there would be no impact on reducing inequality of outcome caused by socio-economic disadvantage. Conversely, the next most prevalent theme was that PAWHP could positively impact disadvantaged or low-income groups. However, some acknowledged the payment’s impact on tackling poverty or fuel poverty could be small.

Other concerns raised by some respondents included that there could be a greater cost associated with administering a devolved payment, that people could lose money or poverty could increase if changes are introduced in the future, and that replacing the payment, in particular changing its name, could lead to confusion, stress and anxiety.

Conclusions

Many individuals and organisations with detailed knowledge took part in the consultation, sharing their views on the proposals for introducing PAWHP as a like-for-like replacement for the WFP. Overall, the key message was that while there is support for a like-for-like replacement, there are potential improvements which respondents would like the Scottish Government to consider when developing PAWHP further. The findings from this analysis will be used by the Scottish Government to support ongoing policy development and inform the drafting of PAWHP regulations.