Gordon Brown is right, the rumoured proposal that the government provide rebates or vouchers to those in ‘fuel poverty’ is simply not sustainable. With an estimated 4.5m homes in fuel poverty by the end of the year, this problem is of a scale that no government can realistically resolve without placing a massive burden on the public purse. Worst still, the problem will still be there in a year’s time, possibly even worse and those recipients will expect the government to step in again.
The government is right, investment needs to be placed into a long term solution, that both encourages and helps people use less energy. This is part education and part investment. It is estimated that home insulation and other energy saving measures can reduce energy bills by as much as a third. However, the government recently reduced the money available to Warm Front by a third, this does not provide much evidence that the government is practicising what it preaches. No doubt Gordon Brown will reverse this decision and then suggest that it is “new money”.
Whilst there are an estimated 4.5m people in fuel poverty, it is worth noting that everyone is suffering, irrespective of whether they have been labeled as such. Those that are not currently in fuel poverty are also having to contend with higher fuel bills, higher food bills and in some cases, higher mortgage costs. Many who are actually working have had to seek part-time jobs. If the government provides subsidies to those in fuel poverty, the truth is, everyone else will have to foot the bill, either through higher taxes or higher fuel bills. The government need to be creative rather than simply shifting the burden, not least because those that are in work have consistently, under this government, been expected to take up the slack and pay for those that are not prepared to look for part-time work.
The government should increase the amount of money available for energy saving measures such as insulation and low energy bulbs. They should persuade, rather than attempt to threaten, the existing energy companies to meet this additional investment on a pound for pound basis. It must be remembered that these energy companies will have to invest billions of pounds over the next 10 years to secure our energy resources for the next generation. They must stop talking about a windfall tax, but instead, use the carbon trading scheme to maximum affect to encourage the investment in UK based energy saving measures rather than those of third world countries.
There is no doubt that the energy companies have taken advantage of the current turmoil to increase their profits and therefore the dividend payments received by their shareholders. The government must provide the regulator with teeth, in order that the regulator can control and approve energy increases. If the regulator is not in place to keep a handle on such matters, then what is it there for? [Can Parliament control Energy Prices]
Another, perhaps more controversial solution, is to allow those in fuel poverty to seek part-time jobs. Yes, I am talking about lone parents, pensioners, the unemployed and the 2.5m in receipt of long term disability payments. There will be some that are genuinely not capable of work, even light work, but the vast majority could do something, stacking shelves, cleaning, washing cars etc. If those in work have to help themselves to keep their heads above water, then why not the unemployed, lone parents, pensioners and long term disabled? Many won’t because they have to declare the money they earn and so, for every pound they earn, they lose it in benefit. So in a way, their view is understandable, given it is a disincentive to help themselves.
Instead of just giving them another handout, which only encourages them to expect a bailout everytime they are in trouble, the government should give them a tax free allowance, that would allow them to earn, for example, up to £150 per month without having to pay tax or national insurance. Yes, we wouldn’t get any tax revenues from these earnings, but neither would the rest of us have to pay out a cash subsidy in full. Better still, it encourages them to stand on their own two feet, to stop looking at the state, or more accurately their working neighbours, friends and relations to subsidise their living expenses. There may be a special case for pensioners, but they, of course, do receive additional fuel allowances and many would work part-time if it were not for the complicated process of paperwork and tax they must endure at the hands of this bureaucracy obsessed government. Those in receipt of ‘tax credits’ could be provided with a special ‘work credit’ that would allow them, or their partner to earn a specified amount of money which would not be subject to tax or national insurance. This could be removed, if necessary, at a leter date as the economy improves.
Any allowances should be very carefully targeted at those that simply cannot help themselves, genuine cases, not the workshy. Those in receipt of benefits would have no excuse not to do what everyone else must do when things are tight, to go and get a part-time job, to help themselves. You reap what you sow.
A creative approache to government always has its critics, because there will always be those that believe it is wrong to expect people to help themselves, or it is just not the way things are done in the UK. Who cares, our greatest leaders have had original thought and a desire to deliver. But, desperate times require desperate measures. A government bereft of original thought, needs to be more radical, a government that believes throwing money rather than opportunity in the direction of the so called poor, needs to look at alternatives.
This government needs to look at its income much the same as the average family. In difficult times, the family will look at ways to economise, ways in which they can generate additional income and ways in which they can reduce or minimise the cost of their borrowings. Government needs to adopt a similar approach. There are countless examples of this government’s waste, excess and abuse of taxpayers money. They need to reign this in now. Government needs to look, not at borrowing their way out of this mess, or just dipping into the pockets of the hardworking taxpayers once again. They must be creative in their thinking, radical in their approach and understand that if it was not for the taxpayers of this country, the poor would be desolate, starving and homeless. But there is a limit to just how much you can redistribute wealth and most taxpayers have had enough.
The pound is low, which makes exports much cheaper, this government should have their best ’salespeople’ lobbying leaders of other countries to buy our products, to improve our exports. It doesn’t matter whether it is the trade department or the ambassador, everyone should be put to work to help this country. Taxpayers funds, as the government has finally discovered, are not the bottomless pit they once believed. Be creative, be bold and stop worrying about your seats at the next election. This government must start to demonstrate respect, not contempt for the ‘have’s’ that have subsidised and supported the ‘have not’s’ and allowed you to spread our money around as if it were your own or an automatic entitlement. Above all, remember, there are 650 of you that have been entrusted with the future of this country, earn that trust by doing your jobs!
A good start would be to suspend or dramatically reduce our overseas aid budget. This could provide up to £5bn to invest in energy saving measures. Charity, as the saying goes, begins at home. This government ignores that at it’s peril.
September 7th, 2008 at 11:48 pm
I was actually insulted by the Government’s suggestion that saving energy is the best way to combat rising fuel bills, in much the same way that I was insulted by Brown’s suggestion that the answer to the credit crunch and rising food costs was to shop more efficiently!
Gas has gone up by 30% this quarter, electricity by 15%. If I could shave those kind of figures off my energy bill I’d be a miracle worker. I already have loft insulation, double glazing, energy saving light bulbs - what’s next? Besides, this year gas has actually gone up 60% and electricity closer to 30%, whatever energy saving measures are taken would be akin to pissing in the wind.
The Government needs to do far more than one off payments or fuel subsidies. It needs to explain why we produce more oil than we use, yet pay so much more than France for oil, when they use 75 times more than they produce. Why we produce more gas than we use, yet pay so much for gas, compared to France, Germany and Spain - who have to import theirs (is it because our energy companies are Spanish, French and German?)
Also if coal is now at a record price, why don’t we start digging it out of the ground again? After all we have masses of it left.
September 8th, 2008 at 7:57 am
Charlie 180: You may an excellent point, I was assuming, perhaps naively, that people on low fixed incomes or those receiving some sort of benefit would not necessarily have efficient central heating, double glazing, insulation and use energy saving bulbs. I completely accept that those that have already invested in energy saving initiatives or have benefited from Warm Front will see the current increases in real terms, i.e. they are not able to do much more to counteract the rises.
You make an excellent point in respect of oil prices and I too would like to see that question answered. Similarly, I would like to know why we still have no gas storage facilities to speak of, leaving us vulnerable to the vagaries of the market. Not discounting the fact that we are also open to commercial or political blackmail from our overseas suppliers. On you last point, I believe they are starting to dig coal again, however, the ‘green lobby’ seem to be kicking up a bit of a fuss about coal fired power stations, which, I suspect, will not encourage too much investment in the extraction process!
September 8th, 2008 at 6:19 pm
The coal issue is something that does annoy me. Little more than a stone’s throw from where I am sitting right now is a disused coal mine, which my members of my family once worked. There’s plenty of coal down there, probably right under my feet, and everyone understood that it was no longer economically viable to keep the mine running, coal was dirt cheap and Johnny Foreigner could dig it out and ship it here for less. Now coal is worth three times more than it was, oil more expensive than ever, I can’t believe the ‘no longer economically viable’ line, not only could we use it again, I am sure that we can sell it again.
The Americans complain about not digging up the huge oil reserves that they still have, I think that we have the same issue with coal.
As for the Greenies, they have been riding a crest of a wave, as things start to get tight and desperate, they will become very unpopular.
I am not surprised about the gas storage, you can’t rely on the Government to plan ahead. When we had a surplus they sold it rather than store it. Now we don’t have enough to sell or store and have to get a top up from Holland.
The Germans though, they import almost all of their gas, yet we pay more than they do for it. I suppose that is privatisation for you, we sell all our energy companies off to foreign owner companies who then use our reserves and our money to subsidise customers in their own, closed, energy markets.
What idiots we are!
October 16th, 2008 at 5:04 pm
I truly agree with your last comment, my gran used to say that “charity begins at home” and we should all consider that, especially in these increasingly difficult times.
December 1st, 2008 at 11:10 pm
OK, lets look at the facts. More than half of those in fuel poverty are pensioners. Most of them have already paid taxes for their whole lives. The national insurance system means they are entitled to a decent pension, they are not charity cases or ‘work shy’. Can I remind you that many of them made huge sacrifices to keep this country free from Hitler and, later, communism? Most of them would be unable to do any sort of properly paid work as they are, by defintion, old! My nan, for example, is 93 and can barely walk or see. Perhaps you have a job in mind for her, such as industrial welding or driving a fork lift? Those pensioners most able to get work (and of course, there are some) are the least likely to be in fuel poverty.
Of the remainder, most will be households containing children. More than half of households in poverty with children contain a working adult, so hardly ‘workshy’. Presumably you think these children should be put to work up chimneys, in coal mines etc. to show they are not ‘workshy’, perhaps alongside the elderly and the disabled. At least that would keep them warm! Alternatively, perhaps their heating sould be turned off so they grow up with terrible health conditions and become a burden on the state. As it has been clearly shown in research that children who live in cold, damp homes suffer seriously reduced educational preformance, how is turning off the heat and light going to help them be the next generation of successful earners?.
In a country that has the fifth largest economy in the world, is it really too much to ask that the elderly, the young and the disabled are able to live in a very modest degree of comfort that most of us take for granted? Do you really think that 4.5 million homes in this country contain ‘those not prepared to look for work’?. I don’t know where you live or who you talk to, but I don’t think this can be the same country as me. If you actually analyse the figues, the number of households who are long-term unemployed (a year or more) is no more than 300,000. I have aways believed that the decency of a society should be measured according to how it treats its weakest members. I’m sorry, but I think you should be ashamed for writing an article as heartless as this.
December 2nd, 2008 at 10:27 am
@ Fuzzy: What a pity you failed to read the posting in full and felt the need to resort to sarcasm to make your point. If you would care to read the posting again, I have made clear that I believe as a society we should distinguish between those that can’t and those that won’t, therefore we can target support to those that most need it, rather than those that believe the world owes them a living.
I know many pensioners who can and do work beyond their retirement age, what they resent most is the fact that the government continues to penalise them in the form of tax. Similarly, those on benefits are not incapable of work, therefore, I have proposed that government should allow them to work, without paying tax, nor losing their benefits, to earn additional money during times of hardship, such as when fuel prices rise to the levels they have.
What disappoints me is people like you that think the state must take care of everything. It is not the state; it is people that are working hard to make a better life for themselves. Without the people you seem to despise or envy, pensions could not be paid at all. Why? Because pensions are paid out of national income, not a pension pot.
Quite where you get your figures on those that are long term unemployed is beyond me? Under this government, to manipulate the unemployment figures, people have been able to claim disability allowances. As a consequence, the number claiming this allowance has risen to 2.5m. Each and every one of these people has to be supported by the rest of us. I have no objection to supporting pensioners, they have, as you say, paid into a national insurance programme that was supposed to provide for their old age. But I also believe there is a limit to the burden that normal taxpayers can take, therefore if a pensioners wants to work rather than face the indignity of having to claim yet another allowance, then they should be allowed to do so.
I would remind you that the massive increase in the tax burden has been on middle income earners, that is people that have worked hard to provide for their families, have children, mortgages, costs of getting to and from work and so on. They have to sacrifice time with their families in order that they can provide. It is also these people that, ironically, have to get part-time jobs when things get tough, so that they can cover the massively increased tax burden they have to contend with. But people like you think that is okay. How narrow minded. Top rate tax payers have not seen an increased burden and those on lower incomes have seen a reduction in their tax burden.
I don’t know anyone that is against offering support for those most in need. But with the best will in the world, you cannot expect people that work hard not to get a little cross when they hear people saying that they won’t get a job because they would be “worst off”. Government treat these people like mugs and people like yourself clearly think that is okay, where is your sense of justice, does it only go one way. Do you so despise people that try and make a better life for themselves and their families; do you so despise the very people that support those that won’t, as well as those that can’t?
When I left school I had two roads I could take, I elected to work hard, not to expect the same state support that many of the people around me did. I have worked very long hours to make something of myself and I will not apologise to you or anyone else for having the pride, motivation and will to do something with myself. What I will say is that I am sick and tired of being hammered by a good for nothing government and the people that support them who believe that someone that has contributed nothing, should have the same standard of living as me. That is utter bollocks.
I am more than willing to contribute towards a health care system for all, to pensioners, the genuine unemployed and people with real disabilities that are unable to work. But don’t you dare expect me to willingly support those that contribute nothing and expect everything. I am sure if you asked your gran, she would probably tell you that you only get out, what you are willing to put in, good old fashioned values. Instead, the message people are given today, is its okay to do nothing, because there will always be other mugs willing for you to sit on your backsides.
I don’t know you from Adam, but I will say this, if you read my post, you will see I have advocated support for those that are in need or are willing to make a contribution. I have said if people are able to do some part-time work, they should be allowed to do so, without affecting their benefits or allowances, because this is preferable than another taxpayer funded handout. When ‘real’ people are short of money, they have to work harder, longer hours, or take a part-time job, when those on benefits need money, they bleat to the government. They may just as well go to their next door neighbour that is working, and take a fiver, because it amounts to the same thing. It isn’t state money, it is money coming from real people, with families, responsibility, obligations and yes, heating bills.
Before you start getting all hot under the collar again, I will repeat what I stated earlier, take it as you will, I suspect there is no convincing you anyway. “I am more than willing to contribute towards a health care system for all, to pensioners, the genuine unemployed and people with real disabilities that are unable to work.”
December 2nd, 2008 at 3:45 pm
I actually have considerable sympathy with some of the points you make about the tax system and the burden on those on middle incomes. However, the debate you seem to want to have is what to do with the long term out of work, which is not the debate I am engaged in on fuel poverty. Let’s assume that one in four of those on Incapacity Benefit could compete for properly paid work in an open market place; that’s 650,000. Add in 300,000 long term unemployed (this is published govenrment data), that’s about one million people, and even if there is only one such per home that’s still less than a quarter of the 4.5 million fuel poor households.
My central point was about the nature of the 4.5 million homes who are in fuel poverty. Let me re-state; more than half are pensioners, most of whom are too poorly or old to do a properly paid job (remember we are not talking about all pensioners, but fuel poor pensioners). Most of the remainder are families with children, of whom we know more than half have an adult in work already (see Households Below Average Income 2006/7). Of those not working, many are disabled or long term sick or single parents of young children. Incidentally, in spite of tabloid rhetoric on this subject, the ability to work test was already stringent and is now being further tightened in the current round of welfare reforms. Whether single parents of pre-school cildren should be made to work is a difficult issue on which I suspect we disagree, but even so, however you count it, I can’t see more than one in four of the fuel poor as able to get part time work. Contrast this with your statement; ‘I am talking about lone parents, pensioners, the unemployed and the 2.5m in receipt of long term disability payments. There will be some that are genuinely not capable of work, even light work, but the vast majority could do something, stacking shelves, cleaning, washing cars etc.’ I feel warmer to you having read your statement of support for the NHS ect. but am unable to find this sentiment in your original article. Nor do i feel that your rhetoric on the tax burden in your reply to my comments adequately addresses the points i made about children, the elderly and the disabled being left in damp, cold homes.
As a final point, I don’t know where you get any idea that I despise or envy those who work hard for a living, I am such myself, and in fact I admire such people. I can’t see any hint of such sentiments in my comments. This always seems to come up when anyone suggests we might treat those in poverty a bit more decently, and it always baffles me. I take your point about my use of sarcasm though, fair comment.
December 2nd, 2008 at 4:45 pm
@ Fuzzy: I suspect that we agree on more points than we differ on, but having personally raised close to £0.5m for two children’s charities one here and one in southern Africa, I do not believe my motives or sincerity in terms of those that need help could be in question. My issue is between those that need and those that want, the government does a very poor job of differentiating between the two and yes, I resent those that could do something for themselves, but elect to take from those less well-off than themselves and well as those able bodied taxpayers.
Resources are finite, therefore the people I focus on are those able bodies people that would seek to take from those that cannot fend for themselves through ill-health, infirmity, illness and so on. We should offer them more help, not less, but we cannot because there are simply too many people abusing the system. It is not about money, so much as how and where it is spent. As a taxpayer, I am entitled to believe that when 55% of my gross income goes to central government that they are investing that money wisely and currently I do not believe that is the case, because it is easier to replace taxes than address the primary cause.
I have lived in real poverty, I know what it is like, but I also see that others that were brighter and smarter than me choose to remain there because it was easier than dragging yourself out of the mire. Similarly, you make the point as to whether single parents of pre-school children should be encouraged to find part-time work. Why not, why should they be any different to the average family that must have two parents working to survive. Remember, if the tax burden wasn’t so high, then maybe one parent could stay at home. This leads to resentment.
I have also argues on my blog that some of the £37bn raised in green taxes should be used to insulate homes of vulnerable people and provide low energy bulbs etc. Equally, I have criticised the government for slashing the Warm Front budget. These would be real investments, not short-term financial hand-outs that have to be means tested every year. I take an active interest in how my tax monies are spent, given every penny taken, is a penny less I can spend on what I choose, be it my family, charity or anything else. If my money is invested wisely and it helps those in need, I will happily have it deducted from my salary, but I will never condone state support for those that are able, but unwilling to do something for themselves.
Therefore, to emphasis, I am not against more support for those in need, I only argue that the money is already there if the government were to determine who is in genuine need and who is swinging the leg.