LABOUR HELPS 130 000 IN COLD CORNWALL

The current cold weather is a good time to recall that the Labour government has done much to help pensioners pay the accompanying high fuel bills, notably with the winter fuel payment introduced by Labour in 1997.

Every household with a person or couple over sixty gets £250 as a winter fuel payment. People of eighty and over get more. Of course, this doesn’t pay the whole fuel bill but it certainly helps; and of course some are more in need than others. Cornwall is far from being the coldest place in Britain in winter but about 131 000 winter fuel payments are made in Cornwall and Scillies (Hansard 27 November 2007, columns 333W-334W). Those payments are for the year 2006/07 and the number will have increased by now – I think my headline figure is an understatement. More needs to be done about the price of fuel and how to make it affordable to those on low incomes, but the fuel payment is a capital practical policy.

The Conservatives have refused to guarantee its continuance should they form a government: Hansard 4 June 2008 column 841. Let me repeat that: the Conservatives have not guaranteed to keep the winter fuel payment.

The elderly in Cornwall have much to thank Labour for. Free bus travel and shorter waiting times in the NHS, state spending on pensioners up 50 percent in real terms since 1997 (Hansard 4 June 2008 column 844), effectively a single pension of £124 a week and £189 a week for a couple (standard minimum guarantee of pension credit), a promise to restore the link between earnings and pensions.

There is still much to do. A scandalously large amount goes unclaimed in benefits and it is urgent to simplify the system and get more necessary money to people who rightfully are entitled to it. The delay in linking pensions and earnings is disappointingly far off: 2012 at the earliest under present government plans. We need a national, rational, and coherent energy policy that minimises gigantic leaps in domestic fuel prices.

Labour has made many mistakes and has not always understood the impact on the poor and vulnerable of their policies such as the abolition of 10p tax rate. Too often poor men’s reasons have not been heard. Its response to its own culpability and to that of the well-heeled for the present economic recession is seriously inadequate. Jerusalem is not yet. Perhaps we never reach Jerusalem. But look what Labour has done that is good. Read the first four paragraphs again. People in Cornwall are being helped, their lives are made better, they and their needs are recognised, not theoretically, not generally, but in minute particulars that count and in that everyday world in which most of us live.

_______________________________________________________________

The original paragraph immediately around the the Arnold and Blake quotations are rewarding reading and I have linked immediately below to accessible online books.

Jerusalem is not yet: Matthew Arnold A French Eton original page 112-113 in the online book

Minute particulars: William Blake Jerusalem original page 55: 60-63 in the prophetic book online (this is not the poem)

Poor men’s reasons are not heard: Thomas Fuller (1654-1734) Gnomologia (Proverb 3897)

WARMER AND CHEAPER IN CORNWALL?

The energy supply statement from Ofgem on 6 October sets out the facts about the differential rates for the various ways of paying for fuel and they do not tell a simple story about unfairness to the poor.

Paying by prepayment meter is about £118 a year more on average than paying by direct debit and paying quarterly by cash or cheque is about £80 a year on average dearer. For more than four million households in rural places, including villages in Cornwall, mains gas is not available and they lack the reduced rates that come with competitive dual fuel tariffs, paying about £55 a year more than if they had access to dual fuel deals. These figures depend on the level of fuel consumption which varies among households.

Of course prepayment and quarterly arrangements cost the companies more to collect and administer than direct debit payments but the differential is greater than that and although the report says the differential in prepayment charges are cost-justified I think the figures suggest a small premium is paid by customers.

It is a commonplace of concern that the poor and the fuel-poor (those who spend more than ten percent of their income on domestic fuel) are using prepayment meters and quarterly payments and are thus paying more for their fuel and energy than the well-heeled paying by direct debits. The Ofgem report is clear that this simple picture is misleading.

Not everyone who pays by the higher rate methods is poor and not everyone who has no access to mains gas is poor, but many are. Not all the poor/fuel-poor pay by the dearer methods but certainly they are concentrated in there; for example the quarterly payment method is the most common payment method among the fuel-poor and just over half of prepayment meter customers are in the bottom two social groups, D and E.

A blanket reduction of the dearer tariffs, removing the unjustified premiums, will help the poor/fuel-poor but also help others on those arrangements. A little has been done but much more is required to target fair, and even subsidised, charges on the poor/fuel-poor. Ofgem is holding a consultation until 1 December 2008 about its report and I hope people and groups in Cornwall will respond and advocate definite help for people who plainly need it: the aim should be to reduce prices for the poor.

The Ofgem report helpfully distinguishes between those who are poor/fuel-poor and vulnerable customers who also include those who are sick or disabled and who also need help in accessing the best financial deals.

These price differentials and barriers should have been tackled definitively so far as they impact upon the poor and vulnerable a long time ago. Better late than never, I suppose. If all goes well next year should be a little warmer and cheaper for many in Cornwall. The Labour government’s winter fuel payment will help people (though it is not targeted on the poor), as will, eventually, lagging; but high prices need more than revised tariffs, winter fuel payments, and lagging, and the government appears unimaginatively unable or unwilling to help.