Government Plan to Reduce Full Poverty
A committee of MPs has revealed plans for a shake up in the way winter fuel payments are dealt out to the elderly. Under the new plans, around 200,000 pensioners on a higher tax rate would see their payments stopped altogether, while others could see the money become taxable.
The government wishes to use the money to help the fuel poor, with the payments taken away or taxed for wealthier individuals, the government would have ?250m free to spend on helping those classified as in ?fuel poverty? – where more than 10% of the household income in spend on bills for gas and electricity. The report from the Environment committee said over five million households experienced this level of poverty in the winter of 2008.
Currently the winter fuel allowance pays ?250 a year to the over 60s and ?400 to the over 80s. Despite paying out over ?2.7bn in payments during winter, the reported suggested that only around 12% of those in receipt of the payment could actually be classed as fuel poor under the government?s own definition.
It called for money gained on taxing the payments to be spent on energy efficient programs for those who are truly in need and said that current energy efficiency programs were disorganised and needed to be merged into a single program.
Leading charity Age Concern called the report a ?wake-up call for the government?.
Energy Expert for Consumer Focus, Jonathan Steam said: ?It is outrageous that there are still more than five million vulnerable households struggling to afford to heat and power their homes. The government’s current energy efficiency schemes are simply not up to scratch. Immediate investment is needed in a radical and coordinated action plan if we are to lift millions of the poorest pensioners, families and disabled people out of fuel poverty and cut carbon emissions.”