Fuel poverty experts Neil Simcock, Lucie Middlemiss and Aimee Ambrose explain why this week's mini-budget was a missed opportunity.
"Almost a quarter of households in Britain are now considered fuel poor – and this week’s mini-budget, like the cap in energy prices announced earlier in the month, has done nothing to ease the burden of those struggling most.
"An average household energy bill of £2,500 per year is not only 2.5 times higher than in October 2021, but also leaves those with unavoidably high energy needs or living in the least energy efficient homes in particular hardship.
"Fuel poverty is widely seen as caused by low incomes, high energy costs and inefficient homes and appliances. The mini budget had no good news on these fronts: those on the lowest incomes will see little benefit from the tax and national insurance cuts, high energy costs persist despite the ‘cap’, and the energy efficiency investment included in the statement seems to be a rebranding of the existing Energy Company Obligation investments already announced in the Energy Bill. It is notable that the 1 billion over three years earmarked for energy efficiency amounts to a mere £36 per household.
"The vast sums borrowed by the UK government (to the tune of £150 billion) to enable the capping of average energy bills at £2,500 per year amounts to nothing more than a temporary sticking plaster solution to prevent average bills reaching the eye watering £3,549 predicted by Ofgem.
"This mini-budget offered an opportunity to invest in the things that improve the resilience of UK households to energy price fluctuation, such as insulation and renewable energy generation. Bear in mind, the price of energy generated from renewables has stayed stable throughout the energy crisis.
"The national fuel poverty charity National Energy Action anticipates that a minimum 6.7 million UK households (almost a quarter of households) are likely to be in fuel poverty this October when the price cap rises to £2.5k. This marks an increase of 2.2 million from the same time last year.
"Research by the Fuel Poverty Research Network suggests that households in or at risk of fuel poverty are likely to take their own action to ensure that their energy bills do not get to £2,500 a year. As a result, we can expect to see further growth in self-disconnection and self-rationing. Self-disconnection is where households opt out of energy services such as heating and electricity because of a lack of funds.
Dr Neil Simcock (Liverpool John Moores University).
Prof Lucie Middlemiss (University of Leeds)
Prof Aimee Ambrose (Sheffield Hallam University)
Dr Simcock teaches on BSc Geography.