I, too, thank the Minister for getting fuel poverty into the Bill. Throughout the Commons proceedings, and the earlier stages of the proceedings in this House, there was considerable criticism that one of the major areas of concern in energy policy—fuel poverty—was not reflected in the Bill. We now have a clear indication of the way the Government are going on this. I also join the noble Lord, Lord Jenkin, and others in thanking the Minister and her officials for trying to explain this somewhat complex position to us last night. The penny may have dropped but I am not sure the shillings have yet on all of it.
Indeed, some of it is not clear and cannot be clear until the Government, in six or eight months’ time, come up with a strategy and the secondary regulations. I understand that. On the other hand, there are some problems with the approach as so-far revealed. The Minister said she wants to display a rigorous and flexible strategy under these provisions. There is a slight danger of being too rigorous and complex on definition and target issues and too flexible and unclear on what the actual strategy will deliver. I will come back to some of those points.
I thank the Government for getting us here. However, we should not ignore the fact that this is, for those of us who have been engaged in fuel poverty and those who suffer from it, quite a sad point. Although most of us have recognised that this has been the situation for some considerable time, we have now explicitly recognised that the statutory ambitions set, with all-party support, in the legislation originated by the noble Baroness, Lady Maddock, and the follow-through of
that, have failed. That has implications for other targets that we set in this area. There is a necessity to be rigorous in not only setting targets but also checking, enforcing, reporting and adapting to any failure to meet those targets, however difficult that might seem.
This is also the point where we have accepted that achieving those statutory targets is not easy. Previous statutory targets talked about the eradication of fuel poverty. We have now abandoned that ambition and substituted reduction, and a reduction that will be made in order of priority. I understand why that is the Government’s position, but in terms of the campaign on fuel poverty it is quite a serious retreat. It might be inevitable. From now, we need to treat it as inevitable and ensure that the new policy, strategy and less ambitious targets are achieved but we should not let this pass without recognising that it is a quite a profound change in our approach.
It is also more of a technologically significant change in the measurement. We debated this and others have commented on it. Some of us had the suspicion when the Treasury, when obliging DECC to look at this area, hoped that the redefinition would define the problem away. Whatever else one may say about Professor Hills, he has definitely reinforced and underlined that fuel poverty is an important and distinct area of policy, one that requires rigorous and effective measures to tackle it. Even with his measurement, which excluded a number of things, we have 2.5 million households in England alone suffering from it. We owe Professor Hills a debt for his report. We are now trying to turn that into some measure of reality.
The first complication it presents is that we now have an English target which measured differently from that in Scotland, Northern Ireland and, probably, Wales. That makes a UK approach to it difficult. Indeed, there was some advance on the basis of the old measurement, which was relatively easily understood, even though it was itself quite complex. It was relatively well established and we were about to adopt it on a pan-European basis. Europe will also have to think again about any co-ordinated approach on this.
Let us accept that the Hills definition will be one of the main measurements. I cannot remember the exact reference, but quite near the beginning of the report that I received yesterday, it says that from now on the Government will establish the figures only on the basis of one of the Hills measurements—namely, the low-income/high-cost measurement. At least for a few years, we need not only to take in the other Hills amendment, relating to the depth of fuel poverty—which in some ways is a useful and more understandable measurement—but to continue to measure it on the old scale. That is the normal approach in a lot of statistical series. Eventually, we may not need that, but for the next five years the credibility of this strategy requires us to look at what we previously defined as fuel poverty, and what our colleagues in devolved Administrations are probably going to go on using as the definition, in order to see how well we are doing. On a purely statistical basis, we ought to retain that.
It is of course also true that many points in Professor Hills’s strategy are not yet fully reflected in the Government’s actions. We will come back to that as
we go on over the next few months. As expressed in the documentation now before us, there is clearly a triangle of effects on fuel poverty: household income, the energy efficiency of the home and the appliances within it, and the price of energy. All three are open to government intervention. The strategy shown by the Government so far focuses very much on intervention on the energy efficiency of homes. I am strongly in favour of such intervention but there is a danger of ignoring the other two sides of the triangle and the forces that define whether fuel poverty is going up or down.
It is important that we find a way of conveying the narrative on all three fronts to the population. Fuel poverty itself, the measurements involved and the nomenclature of the various intervention schemes are complicated enough, and we must find a clear narrative to explain what we are doing on all those fronts. At the moment, as the Commons Select Committee said only a few weeks ago, the Government are unable to convey what they are trying to do and why they are trying to do it when it comes to fuel poverty and energy efficiency interventions.
The new definition, as I say, has some advantages. It probably excludes a number of Members of the House of Lords who are on a reasonable income but live in rather draughty castles. I commend it from that point of view. However, although the Minister may contest this, it does not obviously take us hugely further forward in terms of operationally identifying precisely who those people are. It is pretty sound statistically but, operationally, we have no further clue as to whether such and such a house in such and such a town or village is actually suffering from fuel poverty or not. At one point, as mentioned last night at the briefing, the document refers to assessing the condition of housing at a local level. However, we do not actually have a register of the condition of every house—we only have a broad idea of what the SAP rating of certain kinds of housing is—nor do we have the identification of the household structure and the household income within it. I am not sure that we ever can have that. However, to make this provision work most cost-effectively, we need to see whether local authorities, or other local bodies taking the lead on this, can pin down the priority areas more precisely in terms of streets, houses or type of persons.