Government failing to use green tax money to help ‘fuel poor’
The lion share of money acquired from the government’s green tax charges are being ineptly redistributed to the wrong types of household, data from a prominent think tank disclosed yesterday.
‘Green Taxes’ were implemented by the government in order to aid low income households to deal with the financial demands of rising utility bills, though research has implied that the money gained through them is failing to reach genuine fuel poor houses.
The IPPR study was intended to gauge the effectiveness of green taxes in the country. The green taxes were hoped to be a flagship policy for the current administration.
However, data indicated that over 80% of the £540 million garnered from the policy was being redistributed to the wrong sort of houses, meaning that almost 1.3 million homes were being left unaided with their household heating. This equates to over 50% of the total houses that are currently living in fuel poverty, and has sparked huge levels of criticism aimed at the government due to the failed impact of the policy.
Last week, David Cameron made a statement identifying his intention to ‘roll back’ green taxes, in order to low the costs of consumer energy bills.
The taxes have been blamed by the country’s prominent energy providers as one of the primary reasons for persistent energy price rises. Under current regulations, energy providers have to spend more money in order to improve the energy efficiency of households across the UK. However, energy providers have pointed to these additional costs as a huge factor behind price rises, citing that redistributing the costs to consumer bills was the only way to make the policy financially viable.
However, the taxes will undoubtedly experience a fresh wave of criticism after the IPPR’s research suggested that a monumental £434 million of the total £540 million available for redistribution was being used on low income, energy efficient households, rather than ‘fuel poor’ ones.
‘Fuel poor’ houses are defined as those which have relatively low income occupants, but also have severely poor energy efficiency capabilities, meaning bill prices are at least 10% higher than they should be.
Currently a massive 2.4 million houses are thought to be ‘fuel poor’ across England, with positive action desperately required to try and alleviate the financial burden of rising energy prices on struggling families.
The IPPR has hit out at the government for the way their green tax initiative is currently being conducted, and has called for the procedure to be altered, rather than removed altogether, in order to genuinely aid the ‘fuel poor’ across the country.
Reg Platt, IPPR senior research fellow, said: “The policy has a vital role to play by helping those households who are least able to cope with the increases. But the policy is poorly targeted and over half of households in fuel poverty get nothing.
“Some energy companies with a track record of poor delivery want Eco to be loosened …. This would make a bad situation worse for poor homes, many of whom already have to choose between eating and heating.”
“This would mean that all fuel-poor homes can get support and [most] of the funds would reach fuel-poor homes.”