From the TUC

Cuts Watch #342: Snowman Huhne cuts Warm Front and jobs

06 Jan 2011, by in Cuts Watch

Nicely buried in winter snow, Energy Secretary Chris Huhne announced on 15 December 2010 that this year’s budget for Warm Front – the Government’s grant scheme in England to help vulnerable households – was “fully allocated”, and cut its budget by £500m (two-thirds). With the media focused on airport chaos, the decision triggered 700 redundancy notices at Newcastle firm Eaga, a leading  contractor for home energy installations.

Huhne said that Warm Front was closed for business until April 2011. Funding for the scheme will be cut to £110m for the next financial year starting from April 2011, compared with £345m 2010/11, and then cut further to £100m from April 2012.

Huhne claimed, “The Coalition intends to tackle the underlying causes of fuel poverty by improving the energy efficiency of homes through our new Green Deal and by requiring energy companies, through the Warm Home Discount scheme, to provide financial support with fuel bills to more of the most vulnerable households.”

However, the Green Deal won’t start until the end of 2012, cold comfort for the 4.5 million households in the UK and unable to keep their homes warm.  Estimates on fuel poverty levels in England from Consumer Focus, reveal how the most vulnerable consumers are being hardest hit by fuel poverty.

Since its inception in June 2000 WF has assisted over 2 million households, across England. On average, each household receiving Warm Front assistance including insulation and heating measures has the potential to save approximately £650 a year on energy bills.

Paul Varley, executive committee director at Eaga, launched an attack on the Government’s decision.  “A 65% to 70% reduction in a budget when the latest statistics say there’s more people in fuel poverty than ever is harsh. We can’t put our head in the sand, we have to do something. The coalition Government has made its choices. They are acutely aware of the decision they have made, but they have to save money.

“It doesn’t provide much comfort to the many people who are struggling to heat their homes at this time of year. But the Government must have thought about that and that’s the choice they have made.”

Eaga has enjoyed rapid growth since it was founded 20 years ago, helped by winning contracts with central government, local councils and utility companies in areas such as home energy-efficiency and the digital switchover programme. Eaga has about 1,400 staff working on Warm Front, of which about half are in Newcastle and Gateshead.

The Warm Front consultation document will cut eligibility to warm Front to around 1.5 million households, or one-third of those now facing fuel poverty. The consultation closes on 9th February 2011.