Household Energy Debt

Opened the debate

Kenny MacAskill is concerned about the escalating household energy debt in Scotland and across the UK, citing Ofgem's figures that show £3.1 billion of energy debt with a 50% increase over the last year. He notes that in Scotland, fuel poverty affects 31% of households based on the Scottish Government's house condition survey, reaching almost 50% in northern and island areas. MacAskill also highlights specific challenges faced by disabled individuals, older people, and those who rely on energy for life-saving equipment. He mentions average debt figures from Citizens Advice Scotland at around £2,300 per household.

Government Response

I thank the hon. Member for East Lothian (Kenny MacAskill) for securing this debate on such an important issue, which I care deeply about due to personal experience with fuel poverty. Levels of consumer energy debt have risen in recent years, and the Government recognise it as a growing problem affecting consumers' ability to manage bills efficiently or self-ration energy, leading to cold or damp homes or cutting back in other ways. The Minister encourages anyone concerned about keeping up with bills to contact their supplier or organisations like Citizens Advice for support. Energy prices have fallen significantly since last year, by nearly 60%, including a reduction of £238 in April alone. Over the past two years, the Government has provided more than £108 billion in cost-of-living support, averaging £3,800 per UK household, with millions of vulnerable households receiving up to £900 in further payments and an extra £150 for those eligible for disability benefits. Additional measures include a warm home discount providing low-income households with a £150 rebate off their energy bill every winter. The Government have also committed to working closely with Ofgem and energy suppliers, including the establishment of Energy UK's voluntary debt commitment among 14 suppliers to provide immediate assistance for those in debt over winter. The Minister emphasised that prepayment meters should be used only as a last resort and stressed the importance of quality customer service before households fall into debt. Ofgem has strengthened its licensing conditions for involuntary prepayment meter installations, with exemptions for vulnerable individuals like people who are 75 or older. A call for input on standing charges received over 30,000 individual responses, which Ofgem is currently analysing and will publish its response in due course. The Government have announced further support measures including the biggest increase in the national living wage, welfare reforms with benefit payments increasing by 6.7% and pensions by 8.5%, a cut to national insurance by 2%, and an extension of the household support fund until September 2024 with additional £500 million funding. The Minister acknowledges that this is a complex issue requiring ongoing efforts to ensure proper identification of customers in problem debt and providing appropriate support, emphasizing the need for collaboration across Government departments and stakeholders.