Warm Home Discount change ‘worth considering’ as hard-working households ‘squeezed’

Warm Home Discount is ‘totally insignificant’ says couple

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The new energy price is set to be announced on February 7, with forecasts suggesting it could lead to energy bills rising by a staggering 50 percent. In light of this, many people are looking to access crucial support payments such as Winter Fuel Payment, Cold Weather Payment and the Warm Home Discount. The latter is a £140 reduction on a claimant’s gas and energy costs which is not paid directly to them but taken off their final bills.

It is primarily claimed by those who are on low income and is available between October and March.

However, considering many households who are not low income are set to face difficulty in paying their energy bills over the next year, experts are weighing in on whether the eligibility threshold for the discount should be altered.

Speaking exclusively to Express.co.uk, Michael O’Brien, Citizen Advice Scotland’s Fair Markets Policy Officer, believes this is an option the Government should be considering.

On changing the eligibility threshold for the Warm Home Discount, Mr O’Brien said: “It’s certainly something worth considering. Energy prices are one of the recognised drivers of recent poverty and the Government should wish to tackle that.

“Citizens Advice Scotland has previously argued that the Warm Home Discount scheme can be better targeted to support households that are in poverty.

“That would particularly involve reaching working-age families because some research we did suggests those are the demographics that miss out most from the scheme.

“There is also uncertainty over the future design of the Warm Home Discount, so some clarification on what that is going to look like will be welcome as well.”

Contextualising the energy bill crisis amid the current rise in the cost of living, Mr O’Brien explained why many families will likely struggle even more in light of recent events.

The energy expert added: “The main factor is the unprecedented rise in the cost of gas in the wholesale market.

“These costs eventually fell on the household energy bills and that’s what we’ve seen in recent months.

“Of course, that’s not happening in isolation. Looking back in autumn, we saw the cut to Universal Credit coming in, then to the (end of the) furlough scheme and inflation starting to creep up to over five percent.”

Research carried out by Citizens Advice Scotland found that 640,000 people in the country find their energy bills unaffordable due to low incomes, new analysis from Citizens Advice Scotland (CAS) has found.

The survey which was conducted by YouGov revealed that 36 percent of adults in Scotland find their energy bills unaffordable.

Furthermore, Mr O’Brien noted how the increase to the energy price cap is another reason why further support should be put in place to help households cope with the pending hike in bills.

He added: “Households have really been squeezed from a number of different directions. You’ll hear people talking as well about the price cap.

“That’s really important as it determines how much suppliers can charge customers on variable tariffs or something that’s known as a default tariff.

“The way the price cap is calculated, also reflects conditions in the wholesale markets. Unfortunately, customers aren’t shielded from that.”

The energy price cap change is set to be announced in February and made policy in April 2022.

Express.co.uk has contacted the Department for Business, Energy and Industrial Strategy for comment.

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