This is an issue which affects all of us, with well-publicised research by the University of York’s Kate Pickett demonstrating that people living more unequal societies are less healthy, more anxious and more likely to be affected by crime, right across the income scale.
Research published in the Guardian showed that around 80% of Britons now think the income gap is too large, and the message has been taken up by world leaders. According to Barack Obama, income inequality is the "defining challenge of our times", while Pope Francis states that "inequality is the roots of social ills".
One of the ways that inequality manifests itself in Britain is through the “Poverty Premium” – research published by Church Action on Poverty calculated that the average cost of being poor in the UK is an astonishing £1,300 per year. This mainly comes from extra charges or higher prices which disproportionately affect those on the lowest incomes in three key areas: fuel, food and finance.
This post focuses on fuel poverty, which is defined as the situation where a household must spend more than 10% of their income on energy. Fuel poverty currently affects more than one in 10 homes in Britain but is growing rapidly as energy prices have risen 37% over the last four years, eight times faster than average wages (which have grown only 4,4% in the same period). When families are already at the end of their tether money-wise, it comes down to a choice between heating the house or putting food on the table - how is this acceptable in one of the richest countries of the world?
Energy price rises are exacerbated for the poorest families who actually pay the highest prices because many are forced to pay for their energy through prepayment meters (PPMs), which use more expensive tariffs than other means of payment.
It is very difficult to switch from a PPM to a more affordable way of paying. If you owe any money to your energy supplier, it is almost impossible. The system that should enable people to make this switch (the 'Debt Assignment Protocol') is ineffective.
Alongside this, the UK has the worst insulated homes in Europe (the average British house wall loses three times more heat than the average German wall) and the worst energy ratings of all are found within private rented accommodation, with typical energy efficiency rating of D or worse. This causes over 25,000 deaths during cold weather every winter and costs the NHS £1.3bn per year.
What I find particularly sad about all this is that it doesn’t have to be this way! Insulation is not difficult to install, nor particularly expensive but the Government has scrapped the Warm Front funding which targeted poor households and failed to ensure that funds are effectively distributed via the “Energy Company Obligation” where energy firms are required to invest in insulation targeted at the most vulnerable – instead of ensuring that money is well spent, the Conservatives branded this a “green tax” that they would get rid of! The result is that according to the industry's own figures, last year the UK installation rate for insulating homes halved compared with 2012.
We really have not understood the scale of the challenge here: in order to meet our climate change targets, we must address space heating which accounts for 50% of all domestic energy use, which at present is mostly wasted heating the air outside our homes. We must insulate all UK homes to at least grade B, using technology which is well established and used across Europe. And given the scale of the pain being experienced by the poorest, we cannot afford to push more people over the edge with no heating during the coldest months of the year, resulting in hypothermia or worsening of existing health conditions for the elderly. Overall, the UK government and British society as a whole must do better.
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