Scottish Fuel Poverty Advisory Panel recommendations - September 2023: Scottish Government response

Scottish Government response to the Scottish Fuel Poverty Advisory Panel recommendations - Ministers letter

Scottish Fuel Poverty Advisory Panel

31 January 2024

Firstly, let me offer my personal thanks to each member of the Scottish Fuel Poverty Advisory Panel for contributing your time and expertise, and helping to lay down the foundational roots of the Panel up to this point. I was pleased to see some of you at the Energy Action Scotland conference at the end November, and for the opportunity to meet with Matt Cole, as Panel Chair, for what I found to be a valuable discussion covering our future direction and strategic focus with fuel poverty. I am grateful for the follow-up correspondence of 14 December on which I have sought to provide you with an update, in line with my response to the Panel’s recommendations.

I welcome the Panel’s recommendations to the Scottish Government on our Fuel Poverty strategy, and the early sight afforded to me. This supported a range of internal discussions at official level, whilst publication of the recommendations in September allowed a further layer of external engagement with stakeholders. As the Panel’s advice noted, its views alone are not a substitute for this wider engagement, which has duly been considered and helped inform my response to you across this extensive and cross-cutting policy remit.

It was indeed helpful when I met with your Chair to hear more on the Panel’s thinking and insights. As discussed at that meeting, I am of the view that our approach has to be an adaptable one – in response to the often volatile, uncertain and complex landscape we are faced with - and I am grateful for the Panel’s insights which will continue to inform future planning priorities. I believe our current strategy is the framework which underpins our foundations to build from, together with our guiding legislative basis, that is the 2019 Fuel Poverty Act. Our strategy, little over two years old, sets out a comprehensive set of 55 actions across 10 priority areas, informed by evidence, including lived experience, and learning from our Covid-19 recovery and climate emergency response, at the time. There will be a continuing need to draw upon the latest evidence and research over the lifespan of the strategy, and to act on new and emerging evidence to help inform future direction towards our statutory targets – with our 2019 Fuel Poverty Act providing us with reporting and review points to do so. Equally, it is important that we continue to progress action and understand the impact towards our long-term ambitions.

I broadly support the 6 priority areas for action from the Panel. There is substantial work in progress with Heat in Buildings, including their recently published monitoring and evaluation framework in November – a key contribution towards reducing fuel poverty rates over the longer-term. Our work to transform our homes and buildings over the next two decades will be directed by a set of guiding principles within the Heat in Buildings strategy, which will ensure that actions to achieve clean heat do not come at the cost of exacerbating fuel poverty levels. This is, and rightly should be, a key area for the Panel to constructively challenge, support, and provide their advice, steer and guidance, within our powers to shape and deliver across Scotland. I’m aware the Panel have recently published their response to the Scottish Government’s consultation on Pension Age Winter Heating Payment, and are considering their response to live consultations around proposed new laws on energy efficiency standards and heating systems, as well as a new social housing net zero standard.

On the back of the 2024/25 Scottish Budget, I held a call on 20 December with all current Fuel Insecurity Fund (FIF) partners to outline the position in relation to future funding. In being faced with one of the most difficult financial climates since devolution, with real terms cuts to our block grant from the UK Government, we have had to make tough decisions. In this context it has not been possible to commit additional funding to the Fuel Insecurity Fund – which received a one-off increase in funding during the height of the energy bills crisis – for 2024-25. I acknowledge the Panel’s initial response to the Budget and the sense of disappointment expressed by members and FIF partners. My officials have since held individual follow-up call with partners, and we will ensure that Panel members are kept fully informed of future developments related to the FIF.

We are taking actions within our limited powers to support households struggling with energy bills, including continued investment in our Winter Heating Payment and Child Winter Heating Payment to provide targeted support at the most critical point in the year. This is on top of our £41m investment in the Scottish Welfare Fund for 2024-25, supporting those in the greatest financial stress. The Scottish Budget commits £6.3 billion in social security benefits and payments in 2024-25 - just over £1 billion more than last year. This includes increasing the Scottish Child payment in line with inflation to £26.70 a week, giving more support to over 323,000 under 16s who receive it. This payment is not available anywhere else in the UK – and it’s available because we’re prioritising lifting children out of poverty.

These can only be mitigation measures. The UK Government has to date failed to take the additional steps that we believe to be necessary; for instance, we have called repeatedly for the introduction of a social tariff, which would provide the right and fair support for some of the most vulnerable people in society. However, it appears that the UK Government has no plans to take such a step, having met with my counterpart Ms Solloway this month.

We discussed further engagement with the UK Government to influence change, and to urge it to use to greater effect the fiscal and policy levers at its disposal. We must continue to press the case for such fundamental actions by collectively presenting a strong evidence base. I note the Committee on Fuel Poverty recently published its 2023 annual report with five main recommendations, supported by a series of more detailed calls to action, including targeting of support and/or the introduction of a social tariff, and stronger NHS links in tackling fuel poverty towards preventing poor health outcomes. I was pleased to hear that you have positive and longstanding links in place with your UKG counterpart, and that there is a growing relationship between the respective advisory bodies.

It is therefore imperative that advice and advocacy remains a cornerstone in supporting fuel poverty. I was encouraged to note the Cabinet Secretary for Social Justice response on the back of the Poverty and Inequality Commission’s second cost of living briefing, highlighting continued investment, strong partnership working and identified areas of best practice for better coordinated support. Consumer Scotland, still a relatively new statutory body for consumer advocacy, will have an increasingly influential and powerful role in helping to create a structure of consumer advice and advocacy services that is streamlined and meets the needs of consumers living within vulnerable circumstances.

You will be aware of the drive on public service reform, realising the benefits through working in partnership, and with the introduction of formal clusters. I see an opportunity for the Panel to be at the forefront in such cross-sector connections, to maximise our strategic impact and delivery of outcomes.

I have witnessed first-hand as chair of the Priority Energy Consumers working group, the value and opportunity of bringing such expertise together in a structured forum, towards collective and tangible progress on fuel poverty, including the Panel’s work with social tariff principles. I am clear on the need and importance in retaining this partnership collaborative, including from our Rural Energy and Non-Domestic Groups on an ad-hoc basis, to harness and support our next steps with the recommendations, as we scope areas in more detail.

For completeness, and as covered when Matt Cole and I met, I have set out as an annex below – the Scottish Government’s response to each of the 15 Panel recommendations, which I hope is constructive and supports an ongoing dialogue and engagement in specific areas.

I look forward to the opportunity to join a forthcoming Panel meeting, where we can pick up some of these key points and collectively discuss next steps.

Yours sincerely,

Gillian Martin MSP

Minister for Energy and the Environment

T: 0300 244 4000

E: scottish.ministers@gov.scot