“Fuel poverty went up under Labour, and under this government, we’ve maintained the winter fuel payments, [and] we have increased the cold weather payments.”
- David Cameron, House of Commons, 30 October 2013
Under fire from the opposition over energy price rises, David Cameron was quick to refer to fuel poverty as evidence that his government is doing better than the last.
Yvonne Fovargue, Labour MP for Makerfield, asked the prime minister whether he thought more or less people would switch their heating off this winter because they can’t afford to pay the bill.
“Fuel poverty went up under Labour,” came Mr Cameron’s reply. He went on to list the benefits people suffering from fuel poverty were getting under the current government.
Cost of living has been a major theme for the Opposition, and Ed Miliband, the Labour leader, has been keen to point his party out as the one that stands up for households feeling the pinch.
But how did the last Labour government fare on fuel poverty compared with the current one? FactCheck examines the figures.
There are two definitions of fuel poverty. Under one of them, it went up under Labour. Under the other, it went down.
Until earlier this year, the commonly accepted definition of fuel poverty was spending more than 10 per cent of household income on fuel to maintain an adequate level of warmth.
By that calculation, fuel poverty did indeed go up under the previous government, according to figures from the Department for Energy and Climate Change.
In 2003, 5.9 per cent of households were defined as “fuel poor”, and that consistently rose until it reached a peak of 18.4 per cent in 2009. It then crept down by two percentage points the following year, and fell again, to 14.6 per cent in 2011.
So according to that definition, Mr Cameron was right to say fuel poverty went up under Labour.
In March, Professor John Hills, professor of social policy at the London School of Economics, produced a report proposing a new definition of fuel poverty: the Low Income High Cost indicator.
This said that a household would be fuel poor if fuel costs were above the national average, and were the household to spend that money, their costs would leave them below the poverty line.
This new definition is the one the government intends to adopt.
If you use the new measure, according to Department of Energy and Climate Change (DECC) figures, fuel poverty fell under Labour, by a small margin, from 11.8 per cent of households in 2003 to 11.5 per cent of households in 2009.
Spending on winter fuel payments has decreased under this government.
In 2008, the previous government introduced additional payments of £50 to £100 depending on age. These were kept up until the winter of 2010/11.
In 2011/12, however, the government stopped the additional payments of £50 and £100, and they don’t intend to give it this winter either.
As a result, according to a briefing paper on winter fuel payments, total expenditure on the payment fell from £2.9bn in 2010-11 to £2.2bn in 2011-12. This year, it’s forecast to cost £2.1bn, in real terms and at 2012-13 prices.
Critics like the Institute of Public Policy Research have said the payment is ineffective as “just 12 per cent of recipients [are] thought to be fuel-poor”.
However, in an answer to a parliamentary question, Steve Webb, the pensions minister, said that removing the enhancement would lead to an estimated 25,000 more households falling into fuel poverty.
When the temperature drops to 0 degrees Celcius or below for at least a week running, the Department for Work and Pensions will award an extra £25 a week to pensioners and benefits claimants.
This will cost the Treasury an estimated £228m for 2013.
The payment used to be £8.50 a week, but in 2008/9, the then Labour government raised it to £25 as a temporary measure. The higher payment was kept the following year, and the coalition government made it permanent.
But it is harder to compare this payment under different governments, as it really depends on the weather.
Mr Cameron might claim that the payments have increased under his government, and they have. Last winter, £146m was spent on 5.8 million individual payments. That was up from the year before, when £129m was paid out to 5.2 million households.
Only that year – 2011/12 – was a massive drop from the year before. In 2010/11, £435m was spent on the payments.
This was because the following winter was milder.
Whether fuel poverty has gone up or down under Labour really depends on which definition we might use. Under the previous one it went up, but under the new definition the government wants to adopt, it went down.
That’s purely if we look at the number of people affected. It’s worth pointing out that, even if the number of households defined as fuel-poor went down, the average household has faced an increasingly severe squeeze.
In its Annual Report on Fuel Poverty Statistics DECC said that the average fuel poverty gap per household has increased by £26 to £448 since 2010, largely because of energy prices.
So fuel poverty has become a more acute problem under the coalition, if not more widespread.
FactCheck also takes issue with the claim that Winter Fuel Payments have been maintained, when they’ve clearly been cut. Mr Cameron might claim that he means the payment has been retained rather than being scrapped, but the pensions minister said that he expected the changes to adversely affect 25,000 households.
It’s true that the government has raised payments on Cold Weather, but that’s largely thanks to the weather.
Groups such as National Energy Action also stress that energy efficiency measures are crucial to the argument, and they point out that England is the only UK nation which provides no tax-funded efficiency programmes for vulnerable households.
So Mr Cameron’s words will be cold comfort to householders facing a winter of being in the red.
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