Low Income Winter Heating Assistance consultation: Scottish Government response

Questions 1 to 8 and 11 to 16: Eligibility and the name of the new benefit

Sections 5.1, 5.2 and 5.3 of the consultation document provided an overview of our proposals for the new LIWHA benefit. They asked questions on our intentions to remove the need for a 'cold spell' in order for a client to receive a payment, the eligibility criteria of the new benefit and its proposed name.

Name of the new Benefit

The consultation proposed that the replacement for Cold Weather Payment (CWP) in Scotland be called "Low Income Winter Heating Assistance" (LIWHA)?

Just under half of respondents (48%) agreed with the proposed name with the remainder either disagreeing (39%) or unsure (12%). Some of the concerns expressed by those who disagreed related to the purported stigmatisation of referring to "low income". This theme was also highlighted in the responses to our Experience Panel survey on LIWHA, with some respondents suggesting the name was 'stigmatising' and 'derogatory' and proposing that the 'low income' component of the name should be removed. Conversely, some respondents supported this aspect of the name on the basis it was unambiguous in explaining everything that people needed to know about the benefit and provided clarity about the eligibility criteria, although others noted that not all people on low incomes or receiving a low income benefit will qualify. We will undertake further testing of potential names (for example, 'Winter Heating Assistance') with our Experience Panel members and stakeholders prior to the launch of the benefit.

Removing the requirement for cold weather to trigger payment

The existing CWP pays £25 when recipients experience a cold spell between 1 November and 31 March. The consultation proposed that eligibility to receive the new benefit would be based solely on receipt of a low income benefit, and not also require a period of cold weather. It also asked whether people thought that this would be an effective way of tackling winter heating costs for people on low incomes.

Analysis of responses showed that there was broad support for the introduction of LIWHA, with 70% of respondents agreeing with the proposal to replace CWPs with a new benefit. Over three quarters of respondents also agreed with the proposal to remove the cold spell requirement for payment. The majority of respondents agreed that LIWHA, as proposed, would be an effective way for the Scottish Government to tackle increased winter heating costs of eligible recipients.

Some respondents raised concerns about the proposal to remove the cold spell criteria, highlighting the possibility that individuals living in areas where there are typically more than two cold spells per winter, or prolonged cold spells, would receive less money than they typically do under the current system. For example, a household in an area which experienced three cold spells in a winter would receive £75 (3 payments of £25) under the CWP, but £50 under LIWHA. This was a theme of concern noted by some individuals as well as organisations such as Energy Action Scotland, Age Scotland and Scottish Federation of Housing Associations.

The unpredictable nature of weather dependent payments is one of the key drivers of our proposed change in approach. There has been significant variability in payment numbers in previous winters where in many cases people have received no CWPs. We can measure the comparative value of the payment only in retrospect when we know how many contingent payments have actually been triggered.

Data from previous years shows that approximately 1,000 people who live within the Braemar weather station area have historically experienced more than 2 cold spells in each of the past 7 years, which will have triggered payments totalling more than £50 annually. There are four other areas which have received more than 2 CWPs in at least 2 of the past 7 years. Braemar is the only area of Scotland which received more than £50 in payments in the most recent year. Only 3 other areas received any CWP.

Our change in approach, moving away from weather dependency, means that we will ensure that all households who have been identified as requiring additional support with their winter heating bills will receive it, regardless of weather, temperature or where they live.

The Scottish Government has recently appointed a new Fuel Poverty Advisory Panel to consider how our targeting of various fuel poverty and energy efficiency schemes can be streamlined and improved. We will consider carefully any recommendations made by the panel with regard to delivering Social Security benefits in Scotland.

Using the qualifying low income benefits for Cold Weather Payments to identify households eligible to receive Low Income Winter Heating Assistance

The consultation proposed that eligibility to receive LIWHA should be based on the same qualifying benefits which are currently used to establish eligibility for CWP, but without reference to cold weather. Therefore, clients who would currently be eligible for CWP due to being in receipt of a specified low income reserved benefit^[5] will automatically be eligible for a LIWHA payment.

Some who responded to the consultation suggested extending eligibility to include other qualifying benefits. This would capture certain groups that could be considered as being most at risk of the impact of increases in energy prices and the overall cost of living, such as carers and people receiving disability benefits. Others proposed broadening the scope of the current benefits by removing the requirement for receipt of premiums relating to disabilities and children. Other suggestions included extending eligibility to individuals on low incomes who do not receive any benefits, to ensure that those people are also eligible to receive help with winter heating costs. This approach would introduce a number of difficulties, not least the need to define a low income. This would also place a burden on the client to make an application and to provide any supporting evidence of their eligibility.

It is clear that any addition of further qualifying benefits would increase annual caseload, cost and, in most cases, complexity. Adding to the qualifying benefits for LIWHA could extend eligibility to potentially a significant number of people who are not necessarily on a low income and who could be in employment. We could not therefore deliver LIWHA to an extended group of eligible clients and still launch the new benefit by winter 2022 as we have committed.

Due to the overlap between the current eligibility for CWP and those households who have need for an enhanced heating regime, it is considered that the present proposals are appropriate to ensure that the new payment is targeted to individuals who are most in need. However, we will continue to review the eligibility criteria for LIWHA after the launch of the benefit.