Asked by: Catherine West (Labour - Hornsey and Wood Green)
Question to the HM Treasury:
To ask the Chancellor of the Exchequer, for what reason his Department has decided not to cut VAT on domestic energy bills.
Answered by Lucy Frazer - Secretary of State for Culture, Media and Sport
The Government already applies a reduced rate of VAT at 5 per cent on domestic fuel and power such as gas and electricity.
The Government is providing significant financial support of up to £350 to the majority of households, which will cover more than half of the forecast £700 rise in energy bills for the average household. This support is worth £9.1 billion in 2022-23. This is more generous than removing VAT on domestic fuel and power, which would not be targeted because it would also benefit high-income households that do not need support. There would also be no guarantee that suppliers would pass on the discounts to all customers.
While the Government keeps all taxes under review, there are no plans to remove VAT on domestic fuel and power.
Asked by: Catherine West (Labour - Hornsey and Wood Green)
Question to the HM Treasury:
To ask the Chancellor of the Exchequer, what estimate he has made of how much a single household of one person will receive from the Energy Bill Discount Scheme in in 2022-23; and if that household subsequently added another person from financial year 2023-24 onward, how much they would be paying in that year and each subsequent year via the increase in standing charge.
Answered by Helen Whately - Minister of State (Department of Health and Social Care)
All domestic electricity customers in Great Britain will receive a £200 reduction in their electricity costs from this October. This will be delivered via energy suppliers and will be clearly identifiable as a line item on electricity bills. All domestic energy consumers will pay a charge in future years. This will be reflected by Ofgem in the price cap for future years, and sufficient notice will be given to suppliers to price it into fixed and other tariffs.
We expect households will pay this back from 2023 – when energy prices are expected to be lower - through an increase to standing charges on their bills of around £40 per annum over five years. However to be clear, this is not a loan to either suppliers or households.
There will be cases where changes in people’s personal circumstances mean they may not directly be the recipient of the reduction, but still pay charges in future bills, or vice versa.
This approach is fiscally responsible while also helping customers manage the unprecedented increase in energy bills by spreading the increased costs of global prices over time. The policy will provide a significant reduction to bills this year whilst gas prices are at historic highs.
Asked by: Catherine West (Labour - Hornsey and Wood Green)
Question to the HM Treasury:
To ask the Chancellor of the Exchequer, whether a person under the age of 18 who received the Energy Bill Discount Scheme in 2022-23 as part of their family household would be eligible to pay back that loan in the event that that person moved into their own individual household from financial year 2023-24 onward.
Answered by Helen Whately - Minister of State (Department of Health and Social Care)
All domestic electricity customers in Great Britain will receive a £200 reduction in their electricity costs from this October. This will be delivered via energy suppliers and will be clearly identifiable as a line item on electricity bills. All domestic energy consumers will pay a charge in future years. This will be reflected by Ofgem in the price cap for future years, and sufficient notice will be given to suppliers to price it into fixed and other tariffs.
We expect households will pay this back from 2023 – when energy prices are expected to be lower - through an increase to standing charges on their bills of around £40 per annum over five years. However to be clear, this is not a loan to either suppliers or households.
There will be cases where changes in people’s personal circumstances mean they may not directly be the recipient of the reduction, but still pay charges in future bills, or vice versa.
This approach is fiscally responsible while also helping customers manage the unprecedented increase in energy bills by spreading the increased costs of global prices over time. The policy will provide a significant reduction to bills this year whilst gas prices are at historic highs.
Asked by: Catherine West (Labour - Hornsey and Wood Green)
Question to the HM Treasury:
To ask the Chancellor of the Exchequer, what estimate he has made of how much a single household of two people will receive from the Energy Bill Discount Scheme in 2022-23; and if that household subsequently split into two households of one person each from financial year 2023-24, how much they would each pay in (a) 2023-24 and (b) each subsequent year via the standing charge.
Answered by Helen Whately - Minister of State (Department of Health and Social Care)
All domestic electricity customers in Great Britain will receive a £200 reduction in their electricity costs from this October. This will be delivered via energy suppliers and will be clearly identifiable as a line item on electricity bills. All domestic energy consumers will pay a charge in future years. This will be reflected by Ofgem in the price cap for future years, and sufficient notice will be given to suppliers to price it into fixed and other tariffs.
We expect households will pay this back from 2023 – when energy prices are expected to be lower - through an increase to standing charges on their bills of around £40 per annum over five years. However to be clear, this is not a loan to either suppliers or households.
There will be cases where changes in people’s personal circumstances mean they may not directly be the recipient of the reduction, but still pay charges in future bills, or vice versa.
This approach is fiscally responsible while also helping customers manage the unprecedented increase in energy bills by spreading the increased costs of global prices over time. The policy will provide a significant reduction to bills this year whilst gas prices are at historic highs.
Asked by: Catherine West (Labour - Hornsey and Wood Green)
Question to the HM Treasury:
To ask the Chancellor of the Exchequer, if he will make an assessment of the potential merits of changing the repayable loan of £200 to assist households with increased energy prices into a non-repayable grant in the event that energy and gas prices continue to rise in 2023-24.
Answered by Helen Whately - Minister of State (Department of Health and Social Care)
The Government recognises that many households will need support to help deal with the rising cost of energy. Therefore, the Chancellor of the Exchequer announced a package of support worth £9.1bn in 2022-23 on 3 February. This is composed of:
This is in addition to the existing support measures that are helping those most vulnerable to heat their homes over this winter. These include the Warm Home Discount, which is being expanded to 3m people and increased to £150, up to £300 Winter Fuel Payment for all households with at least one member above State Pension age and a £25 per week Cold Weather Payment – plus our £500 million Household Support Fund. We’re also providing £3bn over this Parliament to help more than half a million lower income homes become more energy efficient, saving them £290 per year on average.
The £200 reduction will be paid to all households and recouped over the next 5 years. This approach is fiscally responsible while also helping customers manage the unprecedented increase in energy bills by spreading the increased costs of global prices over time.
The Department for Business, Energy and Industrial Strategy (BEIS) will work closely with industry and consumer groups on how best to deliver this policy, including through a public consultation in the Spring.
Asked by: Catherine West (Labour - Hornsey and Wood Green)
Question to the HM Treasury:
To ask the Chancellor of the Exchequer, if he will provide additional financial support to low income households to help with the rise of water bills from April 2022.
Answered by Helen Whately - Minister of State (Department of Health and Social Care)
The government is providing support worth around £12 billion this financial year and next to help families with the cost of living. This support includes the £500 million Household Support Fund to help vulnerable households with costs for essentials such as energy bills, food, clothing, and utilities over the winter.Water companies will also continue to offer a wide range of support, including bill discounts such as Watersure and social tariffs, adjusting payment plans and helping customers to get advice on benefits and managing debts. Water companies have also increased their customer engagement to inform households of these measures.
Asked by: Catherine West (Labour - Hornsey and Wood Green)
Question to the HM Treasury:
To ask the Chancellor of the Exchequer, what steps he will take to ensure that the £150 one-off council tax rebate will be given directly to renters and not to their landlords, in cases where the tenant pays their council tax through their landlord and not directly.
Answered by Simon Clarke
The Council Tax Energy Rebate will be paid to whoever is responsible for paying the Council Tax bill. It is for tenants and landlords to agree how the rebate is apportioned between them, reflecting their arrangements for both energy bills and council tax. In cases where landlords include just council tax within the rents they charge, and energy bills are paid separately by tenants, the savings from the Council Tax rebate should be passed on to tenants.
Asked by: Catherine West (Labour - Hornsey and Wood Green)
Question to the HM Treasury:
To ask the Chancellor of the Exchequer, how many and what proportion of renters pay their council tax directly, rather than through their landlord.
Answered by Simon Clarke
Local authorities are responsible for administering council tax and determining who is liable. The government does not hold data on the proportion of tenants that pay their council tax directly. Arrangements for paying council tax bills are a matter for tenants and landlords to agree as part of their contractual arrangements.
Asked by: Catherine West (Labour - Hornsey and Wood Green)
Question to the HM Treasury:
To ask the Chancellor of the Exchequer, if he will provide additional financial support to households with prepayment meters in response to the energy price cap increase announced on 3 February 2022.
Answered by Simon Clarke
The Government recognises many households will need support to help deal with the rising cost of energy prices and is providing support worth £9.1bn in 2022-23 including:
o A £200 discount for households delivered via their energy bill this autumn, paid back automatically over the next 5 years, spreading the increased costs of global prices over time in a way that is more manageable for households.
o A £150 non-repayable cash rebate to 80% of households to help with rising costs now, delivered as a payment from government to Local Authorities, for implementation from this April via a payment to all households in Council Tax Bands A-D.
o £144 million of discretionary funding for Local Authorities to support households who need support but are not eligible for the Council Tax reduction.
Domestic energy customers will receive the discount regardless of the type of payment method. The Department for Business, Energy and Industrial Strategy (BEIS) will work closely with industry and consumer groups on how best to deliver this policy, including through a public consultation in the Spring.
We have consulted on expanding the Warm Home Discount by almost a third from 2.2m to 3m vulnerable households and increasing the rebate value to £150 each year.
The Government is also providing £3bn over this Parliament to help more than half a million lower income homes become more energy efficient, saving them £290 per year on average, including through the Social Housing Decarbonisation Fund and Home Upgrade Grant.
Asked by: Catherine West (Labour - Hornsey and Wood Green)
Question to the HM Treasury:
To ask the Chancellor of the Exchequer, if he will increase funding to help households who have outstanding energy and electric debt.
Answered by Simon Clarke
The Government recognises many households will need support to help deal with the rising cost of energy prices and is providing support worth £9.1bn in 2022-23 including:
o A £200 discount for households delivered via their energy bill this autumn, paid back automatically over the next 5 years, spreading the increased costs of global prices over time in a way that is more manageable for households.
o A £150 non-repayable cash rebate to 80% of households to help with rising costs now, delivered as a payment from government to Local Authorities, for implementation from this April via a payment to all households in Council Tax Bands A-D.
o £144 million of discretionary funding for Local Authorities to support households who need support but are not eligible for the Council Tax reduction.
This is on top of wider support for vulnerable households, elderly and low-income people this winter through the Warm Home Discount (which is being expanded by a third to 3m people and increased to £150), up to £300 Winter Fuel Payment and £25 per week Cold Weather Payment, which help ensure those most vulnerable are better able to heat their homes. Our £500m Household Support Fund will also help vulnerable households with the costs of essentials over the winter.
For consumers with existing debt with their energy supplier, the Government will explore how the rebate can lower their bills from October, while supporting their repayment plans, through a public consultation run by the Department for Business Energy and Industrial Strategy (BEIS) in the spring.
The Government is also providing £3bn over this Parliament to help more than half a million lower income homes become more energy efficient, saving them £290 per year on average, including through the Social Housing Decarbonisation Fund and Home Upgrade Grant.