Fuel Poverty
The Scottish Fuel Poverty Statement
Consultative Draft

The UNISON Scotland Response
May 2002

Executive Summary

• UNISON is Scotland's largest trade union representing members in the utilities and staff in the NHSiS, local government and the voluntary sector who deal with the consequences of fuel poverty on a daily basis.

• We welcome the publication of this statement recognising that this is the first government to seriously address an issue that impacts on 30% of Scottish households.

• UNISON does not support the definition of fuel poverty in the statement. We believe that by including benefits the numbers of fuel poor will be artificially reduced.

• The measures in the statement are also welcome with the exception of New Housing Partnerships that are not supported by UNISON. The statement does however need to build on existing programmes.

• The major weakness is the absence of formal co-ordination of initiatives to ensure no household falls between the different programmes.

• UNISON Scotland recommends the adoption of a comprehensive fuel poverty strategy as set out in the recommendations of the Keeping Scotland Warm initiative jointly sponsored by UNISON. These measures would raise housing standards and strengthen energy efficiency measures in the public and private sector.

• The strategy would recognise the important role of local authorities as housing providers and regulators as well as strengthening the Home Energy Conservation Act.

• UNISON Scotland is highly critical of the role played by the energy regulator Ofgem whose policies have done little to eliminate fuel poverty. The mantra of price competition has done little to help disadvantaged customers.

Introduction

1. This paper constitutes a response from UNISON Scotland to the Scottish Executive Fuel Poverty Statement consultation draft.
2. UNISON is Scotland's largest trade union. It is also the largest trade union representing staff in the Scottish utilities directly involved in providing energy. In addition UNISON Scotland has many members in the NHSiS, local government and the voluntary sector who deal with the consequences of fuel poverty on a daily basis.
3. UNISON has played a significant role in recent years at both Scottish and UK level in the campaign to eradicate fuel poverty. We were joint sponsors of the Keeping Scotland Warm programme, which promoted a domestic energy efficiency policy for Scotland. We have also jointly sponsored a video that highlights the startling facts that surround fuel poverty today in Scotland. We support the revised Keeping Scotland Warm statement "Fuel Poverty Now".
4. These facts include 30% of Scottish households that live in fuel poverty and the nine out of ten homes that fall below current energy efficiency standards. Only a quarter of Scotland's homes are adequately heated.

The Scottish Statement

5. UNISON Scotland welcomes the publication of the Scottish statement and the requirements on the Scottish Executive as set out in s88 of the Housing (Scotland) Act 2001. For far too long the approach to fuel poverty as been dissipated amongst several departments and agencies.
6. UNISON Scotland welcomes the acknowledgement of fuel poverty and the commitment in the Act to ensure, so far as is reasonably practicable, that persons do not live in fuel poverty. We do not support the definition of fuel poor households chosen by the Scottish Executive. By including benefits the definition has the effect of falsely inflating household income and ignores the fact that households have little control over housing costs. UNISON believes that the definition net of housing costs should be used.
7. UNISON Scotland has supported the Scottish Executive's programme of central heating for pensioners and other vulnerable households and the warm deal. This compliments the investment programmes initiated by local authorities and housing associations in their own housing stock.
8. UNISON does not support the New Housing Partnerships initiative. In our submission to the Scottish Executive we highlighted the additional costs and the loss of democratic accountability by handing over control of public housing to financial institutions. We argued that the outstanding debt could be taken over by central government freeing up massive resources from rents to improve housing stock. The additional cost of NHPs could be used more effectively in addressing fuel poverty.
9. Other current programmes are listed in the statement including affordable warmth and the improvement and repairs grant system. However, there are few new proposals and we would wish to see existing programmes strengthened.
10. There is a welcome recognition in the strategy of the impact of wider social policy issues and the need to work in partnership with other agencies. What is missing in this strategy is the formal co-ordination of initiatives to enable the more effective use of resources and to ensure that no household falls between different programmes. In particular there is a need to improve the NHSiS involvement in this issue.

A Comprehensive Fuel Poverty Strategy

11. In 2000 UNISON joined with Energy Action Scotland and Transco to bring together a wide range of experts and interested bodies to produce recommendations to eliminate fuel poverty in Scotland. The statement Keeping Scotland Warm (see attached) has recently been revised and launched at a seminar in Edinburgh on 21 May 2002. The statement sets out a range of proposals that include a role for the Scottish Executive and UK government departments as well as Ofgem and the domestic energy companies.
12. The key elements of Keeping Scotland Warm include:

• Encouraging good practice and improved co-ordination of existing initiatives
• Legislation to raise the standard of new homes
• Strengthening the Home Energy Conservation Act (HECA)
• Statutory energy efficiency measures in the private rented sector
• A new system of energy efficiency grants and heating benefits.
• The impact of the UK Energy Policy Review
• Local housing strategies

Regulation

16. The industry regulator Ofgem has made a series of proposals to increase and extend competition in the energy industry in Scotland. In addition Ofgem seeks to assist the elimination of fuel poverty through its Social Action Plan.

17. In a number of formal and informal responses UNISON Scotland has been highly critical of the role of Ofgem in this area. We do not believe that price competition alone is sufficient to assist those in greatest need and the Social Action Plans have generally been an inadequate response to the problem. Research sponsored by UNISON has demonstrated that privatisation has not been the cause of lower electricity prices.
18. The promotion of competition has inevitably resulted in all the domestic energy companies in Scotland chasing high value customers who can pay by direct debit. This is increasingly at the expense of services to disadvantaged customers. The most recent example of this has been the wholesale closure of High Street shops with their easy access to advice and cash payment systems, firstly by Centrica and more recently by ScottishPower.
19. A survey by the National Right to Fuel Campaign confirms that competition has exacerbated long standing inequalities between certain low income groups and more affluent customers. The activities of doorstep sales staff has been a significant problem and the survey concluded that access to competitive energy markets was associated with access to other related services, particularly financial services.
20. UNISON believes that government support for the mantra of competition needs to be reviewed together with the Ofgem terms of reference and we have spelt out these concerns in more detail in our submission on the UK Energy Policy Review. Without this solutions will always seek to work with "the grain of the market". What is needed is direct intervention and incentives to encourage good practice.

Conclusion

21. UNISON Scotland believes there is much in the consultation draft to be welcomed and we recognise that this is the first government at UK and Scottish level to seriously address this issue. Our main reservations are over the need for a more co-ordinated and comprehensive approach. Without such an approach the elimination of fuel poverty may remain an elusive target.

For Further Information Please Contact:

Matt Smith, Scottish Secretary
UNISONScotland
UNISON House
14, West Campbell Street,
Glasgow G2 6RX
Tel 0141-332 0006 Fax 0141 342 2835
e-mail matt.smith@unison.co.uk

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