WIREDGOV

Social policy expert Professor John Hills has been appointed by Energy and Climate Change Secretary Chris Huhne to lead an independent Review of the fuel poverty target and definition.

A household is currently classed as being in “fuel poverty” if it would need to spend more than 10% of its income on fuel to keep their home warm enough.

Chris Huhne said:

“The Government is committed to help people, especially the vulnerable, heat their homes more affordably.

“The Review will analyse how we define and measure fuel poverty from an independent perspective. Professor John Hills will bring insight, authority and understanding to the role of the independent reviewer. I have asked him to report back to me with his final findings early next year.”

Professor John Hills said:

“Many households have been under pressure from their heating bills this winter, some severely so because of their particular needs or difficulties in keeping their homes warm.
“It is crucial that we measure the scale of the problem and trends in it accurately. I am looking forward to reviewing the evidence on the underlying issues that lead to fuel poverty and on how well the current measure reflects the problems involved and the effectiveness of policies to counter it”.

The independent review has been asked to look at fuel poverty from first principles, what causes it, its effects, and how best to measure it. If appropriate based on initial findings, it will identify and consult on options for alternative definitions and associated forms of target.

A call for evidence to help shape the review is also being launched today.

Notes for editors

1. A household is said to be in fuel poverty if it needs to spend more than 10% of its full income (after tax) on fuel to maintain a satisfactory heating regime (21°C for the main living area, and 18°C for other occupied rooms).
    
2. Latest figures suggest that in 2010, four million households were in fuel poverty in England. Full statistics are available at: http://bit.ly/6pJZmhExternal link.
    
3. The Spending Review announced an independent review of the fuel poverty target and definition so that available resources could be focused where they will be most effective in tackling the problems underlying fuel poverty. It covers England only, although the review will seek the views of the Devolved Administrations in the course of its work.
    
4. The Review will publish interim findings in autumn 2011 and provide a final report to Government no later than January 2012. The full terms of reference are:
    

     1) To consider fuel poverty from first principles: to determine the nature of the issues at its core, including the extent to which fuel poverty is distinct from poverty more generally, and the detriment it causes.
     2) As appropriate and subject to the findings under (1), to develop possible formulations for a future definition and any associated form of target, which would best contribute to:

• addressing the underlying causes identified;
• helping Government focus its resources (which are set out in the Spending Review for the period to 2014-15) and policies on those who need most support;
• measuring the cost effectiveness of different interventions in contributing to progress towards any target; and
• developing practical solutions, particularly around identification and targeting of households and measuring progress resulting from Government action.
   

5. The call for evidence launched today is also available at http://www.decc.gov.uk/hillsfuelpovertyreview. The closing date for responses is 6 June 2011.

6. Professor John Hills is Director of the Centre for Analysis of Social Exclusion and Professor of Social Policy at the London School of Economics. His research interests include income distribution and the welfare state, social security, housing and taxation. He chaired the National Equality Panel established in late 2008, which reported a year ago. He carried out a review of the aims of social housing for the then Secretary of State for Communities in 2006-07 and was one of the three members of the UK Pensions Commission from 2003 to 2006. Recent major publications include Towards a More Equal Society? (2009) and Inequality and the State (2004).

7. The Coalition Government is already taking action to help vulnerable people including:

• taking powers in the Energy Bill to introduce a new Energy Company Obligation alongside the Green Deal – the nationwide plan to radically improve the energy efficiency of homes. This will require energy suppliers to support the delivery of energy efficiency measures in households, focused particularly on the needs of the poorest and most vulnerable, and on “hard to treat” homes that need particularly expensive measures like solid wall insulation;
   
• requiring energy companies by law to give a discount on energy bills to more of their most vulnerable customers under the new Warm Home Discount;
   
• ensuring CERT – the Carbon Emissions Reduction Target – is better targeted to help the most vulnerable households install energy efficiency measures.