Fuel Poverty Action letter to Ofgem – Ofgem’s “safeguard” cap on energy tariffs should do more to keep Disabled adults and children warm

Every year thousands of people unnecessarily die from cold homes. On the 21st November, the eve of the release of the latest excess winter deaths statistics, Fuel Poverty Action and a wide range of disability and poverty organisations delivered a letter to Ofgem about their proposed “safeguard” cap on energy tariffs.

Protestors with a banner which sys FUEL POVERTY ACTION

Every year thousands of people unnecessarily die from cold homes. On the 21st November, the eve of the release of the latest excess winter deaths statistics, Fuel Poverty Action and a wide range of disability and poverty organisations delivered a letter to Ofgem about their proposed “safeguard” cap on energy tariffs.

Many disabled people and parents of small children, who could qualify for the cap, will be left out in the cold because they fail to receive the Warm Home Discount, which is awarded on a first come first serve basis, and which is intended as the “passport” to protection from soaring prices.  Yet disabled people often need heat most and suffer most when they cannot afford it.

The letter challenges this in detail.

 

21​ ​November​ ​2017

Dear​ ​Ofgem,

Re:​ ​“Vulnerable​ ​Customer​ ​Safeguard​ ​Tariff”

We​ ​write​ ​because​ ​we​ ​are​ ​concerned​ ​that​ ​your​ ​plans​ ​to​ ​implement​ ​a​ ​very​ ​limited, discriminatory,​ ​“safeguard”​ ​cap​ ​on​ ​energy​ ​tariffs​ ​would​ ​exclude​ ​many​ ​of​ ​the​ ​people​ ​who need​ ​the​ ​cap​ ​most.  This​ ​will​ ​lead​ ​to​ ​deaths,​ ​ill​ ​health,​ ​and​ ​misery,​ ​notably​ ​for​ ​people​ ​who​ ​are​ ​disabled​ ​or​ ​have long​ ​term​ ​illnesses,​ ​and​ ​for​ ​young​ ​children​ ​and​ ​their​ ​parents.​ ​​ ​​Both​ ​may​ ​be​ ​eligible​ ​for​ ​Warm Home​ ​Discount,​ ​which​ ​should​ ​qualify​ ​them​ ​for​ ​the​ ​cap,​ ​but​ ​only​ ​those​ ​who​ ​actually​ ​​receive the​ ​Warm​ ​Home​ ​Discount​ ​will​ ​be​ ​protected​ ​by​ ​the​ ​cap​ ​under​ ​your​ ​plans.​ ​​While​ ​pensioners on​ ​low​ ​income​ ​will​ ​be​ ​covered​ ​automatically,​ ​disabled​ ​people,​ ​young​ ​children,​ ​and​ ​others who​ ​could​ ​benefit​ ​from​ ​the​ ​cap​ ​will​ ​instead​ ​continue​ ​to​ ​pay​ ​extortionate​ ​sums​ ​to​ ​their​ ​energy suppliers. Disabled​ ​people​ ​often​ ​need​ ​more​ ​heat,​ ​for​ ​medical​ ​reasons​ ​or​ ​if​ ​they​ ​are​ ​home​ ​a​ ​lot,​ ​and can​ ​suffer​ ​much​ ​worse​ ​effects​ ​if​ ​they​ ​can’t​ ​afford​ ​to​ ​keep​ ​warm.​ ​What’s​ ​more,​ ​they​ ​have been​ ​hit​ ​the​ ​hardest​ ​by​ ​multiple​ ​cuts​ ​to​ ​incomes​ ​and​ ​services,​ ​leaving​ ​them​ ​in​ ​a​ ​poor position​ ​to​ ​deal​ ​with​ ​rising​ ​fuel​ ​prices. The​ ​same​ ​is​ ​true​ ​of​ ​parents​ ​with​ ​babies​ ​and​ ​young​ ​children,​ ​who​ ​have​ ​endured​ ​benefit​ ​cuts, low​ ​wages​ ​and,​ ​now,​ ​universal​ ​credit,​ ​which​ ​have​ ​all​ ​caused​ ​a​ ​massive​ ​increase​ ​in​ ​child poverty. Both​ ​may​ ​lose​ ​out​ ​on​ ​both​ ​Warm​ ​Home​ ​Discount​ ​and​ ​the​ ​safeguarding​ ​cap​ ​because:

  • Non-pensioner​ ​applications​ ​to​ ​the​ ​Warm​ ​Home​ ​Discount​ ​will​ ​be​ ​offered​ ​from​ ​a​ ​limited pot​ ​and,​ ​as​ ​such,​ ​will​ ​be​ ​made​ ​available​ ​on​ ​a​ ​“first​ ​come​ ​first​ ​served”​ ​basis.​ ​The​ ​“first come​ ​first​ ​served”​ ​nature​ ​of​ ​this​ ​initiative​ ​will​ ​cause​ ​those​ ​who​ ​are​ ​eligible​ ​for​ ​the Warm​ ​Home​ ​Discount,​ ​and​ ​subsequently​ ​the​ ​“safeguarding”​ ​cap,​ ​to​ ​be​ ​excluded​ ​from being​ ​“safeguarded”​ ​from​ ​extortionate​ ​energy​ ​prices.
  • Some​ ​smaller​ ​suppliers​ ​don’t​ ​offer​ ​the​ ​Warm​ ​Homes​ ​Discount,​ ​excluding​ ​their customers​ ​from​ ​the​ ​“safeguard”​ ​cap.

The​ ​Warm​ ​Home​ ​Discount​ ​can​ ​save​ ​£140​ ​a​ ​year​ ​off​ ​an​ ​electricity​ ​bill,​ ​whilst​ ​you​ ​estimate that​ ​the​ ​“safeguard”​ ​cap​ ​could​ ​save​ ​the​ ​average​ ​user​ ​up​ ​to​ ​£120​ ​a​ ​year.​ ​That​ ​is​ ​an​ ​average saving​ ​of​ ​£260​ ​a​ ​year​ ​missed​ ​by​ ​those​ ​who​ ​need​ ​it​ ​most​ ​–​ ​and​ ​more​ ​for​ ​people​ ​who​ ​need​ ​a lot​ ​of​ ​heat. There​ ​is​ ​a​ ​real​ ​risk​ ​that​ ​people​ ​who​ ​don’t​ ​qualify​ ​for​ ​the​ ​cap​ ​will​ ​even​ ​see​ ​their​ ​fuel​ ​prices rise,​ ​as​ ​suppliers​ ​try​ ​to​ ​recoup​ ​the​ ​losses​ ​caused​ ​by​ ​a​ ​cap​ ​on​ ​their​ ​prices.​ ​​We​ ​do​ ​not​ ​share your​ ​faith​ ​that​ ​a​ ​competitive​ ​market​ ​will​ ​prevent​ ​this. We​ ​cannot​ ​accept​ ​your​ ​claim​ ​in​ ​your​ ​consultation​ ​paper​ ​that​ ​these​ ​exclusions​ ​are​ ​necessary in​ ​order​ ​to​ ​bring​ ​the​ ​cap​ ​in​ ​quickly.​ ​​​We​ ​see​ ​no​ ​reason​ ​why​ ​implementation​ ​of​ ​the​ ​cap​ ​could not​ ​be​ ​immediate​ ​for​ ​Warm​ ​Home​ ​Discount​ ​recipients​ ​already​ ​on​ ​suppliers’​ ​lists​ ​as​ ​receiving Warm​ ​Home​ ​Discount,​ ​and​ ​then​ ​​extended,​ ​before​ ​next​ ​winter,​ ​to​ ​others​ ​who​ ​qualify​ ​for it​​ ​–​ ​some​ ​of​ ​whom,​ ​under​ ​the​ ​present​ ​plan,​ ​will​ ​apply​ ​and​ ​will​ ​be​ ​refused. Going​ ​further, linking​ ​the​ ​selection​ ​criteria​ ​for​ ​the​ ​Warm​ ​Home​ ​Discount​ ​is​ ​in​ ​itself​ ​problematic.

  • ​ ​​Benefit​ ​assessments​ ​have​ ​a​ ​high​ ​level​ ​of​ ​inaccuracy,​ ​with​ ​over​ ​60%​ ​of​ ​benefit assessment​ ​decisions​ ​overturned​ ​at​ ​appeal​ ​for​ ​both​ ​the​ ​Personal​ ​Independence Payment​ ​and​ ​Employment​ ​and​ ​Support​ ​Allowance.
  • Some​ ​customers,​ ​like​ ​many​ ​asylum​ ​seekers,​ ​who​ ​are​ ​excluded​ ​from​ ​welfare​ ​benefits, will​ ​automatically​ ​be​ ​excluded​ ​from​ ​the​ ​cap,​ ​as​ ​well,​ ​and,​ ​already​ ​living​ ​below subsistence,​ ​will​ ​be​ ​forced​ ​to​ ​pay​ ​more​ ​for​ ​fuel.
  • By​ ​your​ ​own​ ​calculations,​ ​there​ ​are​ ​1.7​ ​million​ ​Warm​ ​Home​ ​Discount​ ​recipients​ ​on Standard​ ​Variable​ ​Tariffs,​ ​whilst​ ​there​ ​may​ ​be​ ​around​ ​5.6​ ​million​ ​households​ ​on Standard​ ​Variable​ ​Tariffs​ ​that​ ​contain​ ​at​ ​least​ ​one​ ​individual​ ​on​ ​income​ ​or disability-related​ ​benefits.
  • ​ ​​In​ ​addition,​ ​the​ ​selection​ ​criteria​ ​for​ ​the​ ​Warm​ ​Home​ ​Discount​ ​are​ ​determined​ ​by energy​ ​suppliers​ ​(usually​ ​conditional​ ​on​ ​which​ ​benefits​ ​one​ ​is​ ​receiving),​ ​which means​ ​that​ ​someone’s​ ​eligibility​ ​may​ ​be​ ​arbitrarily​ ​determined​ ​by​ ​whichever​ ​energy supplier​ ​they​ ​happen​ ​to​ ​be​ ​in​ ​contract​ ​with.

Energy​ ​prices​ ​are​ ​too​ ​high​ ​for​ ​everyone​ ​now,​ ​and​ ​thousands​ ​of​ ​people​ ​in​ ​all​ ​sorts​ ​of situations​ ​are​ ​dying​ ​from​ ​cold​ ​every​ ​year.​ ​​ As​ ​the​ ​body​ ​responsible​ ​for​ ​customer​ ​protection, Ofgem​ ​should​ ​be​ ​acting​ ​on​ ​this​ ​now.

But​ ​in​ ​the​ ​meantime,​ ​the​ ​cap​ ​scheduled​ ​to​ ​come​ ​in​ ​this​ ​coming​ ​February​ ​should​​ ​​apply to​ ​everyone​ ​who​ ​would​ ​be​ ​​eligible​​ ​for​ ​Warm​ ​Home​ ​Discount,​ ​whether​ ​or​ ​not​ ​they actually​ ​receive​ ​it​.

Yours​ ​sincerely,

Sam​ ​Hayward,​ ​​Fuel​ ​Poverty​ ​Action

Linda​ ​Burnip​ ​and​ ​​Ellen​ ​Clifford​,​ ​​DPAC​​ ​(​Disabled​ ​People​ ​Against​ ​Cuts)

Tracey Lazard, Inclusion London

and

Jacky​ ​Peacock,​ ​​Advice4Renters

Geraldine​ ​Takundwa,​ ​​All​ ​African​ ​Women’s​ ​Group

Frances​ ​Howe,​​ ​Biofuelwatch

Cristel​ ​Amiss​ ​​Black​ ​Women’s​ ​Rape​ ​Action​ ​Project

Kamran​ ​Mallick,​ ​CEO,​ ​​Disability​ ​Rights​ ​UK

Charles​ ​Montlake,​ ​​District​ ​Heating​ ​Stakeholders​ ​Group

Ed​ ​Matthew,​ ​​E3G​ ​(Third​ ​Generation​ ​Environmentalism)

Michael​ ​Cormack,​ ​​Edinburgh​ ​Coalition​ ​Against​ ​Poverty

Cari​ ​Mitchell,​ ​​English​ ​Collective​ ​of​ ​Prostitutes

Selma​ ​James,​ ​​Global​ ​Women’s​ ​Strike

Alan​ ​Kerr,​ ​​Greenwich​ ​Association​ ​of​ ​Disabled​ ​People

Samir​ ​Jeraj,​ ​​Hackney​ ​Green​ ​Party

Cllr​ ​Ian​ ​Rathbone​ ​and​ ​Cllr​ ​Deniz​ ​Oguzkanl​ ​for​​ ​Lea​ ​Bridge​ ​(Hackney)​ ​Labour​ ​Party

Penny​ ​Savage,​ ​​ ​​LAMPAG​ ​(Lambeth​ ​Pensioners​ ​Action​ ​Group)

John​ ​Hamilton,​ ​​Lewisham​ ​People​ ​Before​ ​Profit

Ronald​ ​Douglas,​ ​​London​ ​&​ ​Anglia​ ​Region​ ​RMT/RMA

Jan​ ​Shortt,​ ​​National​ ​Pensioners​ ​Convention

I​Irena​ ​Fick,​ ​​Older​ ​Feminists​ ​Network

Mena​ ​Rego,​ ​Chair,​​ ​Oval​ ​Quarter​ ​Residents​ ​Association

Benoit​ ​Martin,​ ​​Payday​ ​men’s​ ​network

Chris​ ​Baugh,​ ​Assistant​ ​General​ ​Secretary,​ ​​

PCS Anne​ ​Lamming,​ ​​Queer​ ​Strike

Hannah​ ​Smith,​ ​​Reclaim​ ​The​ ​Power

Kim​ ​Sparrow,​ ​​Single​ ​Mothers’​ ​Self-Defence

Simon​ ​King,​ ​CEO,​ ​​SK​ ​media

Emma​ ​Hughes,​ ​​Switched​ ​On​ ​London

Sampson​ ​Low,​ ​Head​ ​of​ ​Policy,​ ​​UNISON

Claire​ ​Glasman,​ ​​WinVisible​ ​(women​ ​with​ ​visible​ ​&​ ​invisible​ ​disabilities)

Sara​ ​Callaway,​ ​​Women​ ​of​ ​Colour​ ​in​ ​the​ ​Global​ ​Women’s​ ​Strike