Research reveals impact of fuel poverty
Published by Roisin Rowley-Smith for Riverside in Housing and also in Bill Payments, Care and Support, Communities, Health, Universal Credit
Riverside’s research into the impact of financial and economic changes on households has uncovered increasing vulnerability for people whose disposable income is rapidly decreasing, with fuel costs one of the most expensive outgoings.
The research project – Challenging Times, Changing Lives – is following 18 families, single people and couples over three years to assess how people are coping with austerity measures, including changes to welfare benefits.
Two-thirds of participants struggled with the cost of heating their home. Over half have gas pre-payment meters, with higher tariffs. Throughout the winter the average weekly cost of heating was £25-£30 with the highest gas bill £1,000 for a quarter, despite the fact that over half of the households admitted to restricting use to core times and wearing extra clothing. They also cut down on food to pay for heating.
Riverside researchers carried out the second round of six monthly interviews with households based in Wirral, Southwark, Lambeth, Lewisham and Carlisle, and a mix of people in work, on benefits, retired and with health issues.
Hugh Owen, director of policy and communication at Riverside, said: “People are very reluctant to change from pre-payment meters to a cheaper direct debit tariff. This was also evident in a recent tenant survey, where over half wanted to stay with a pay-as-you-go option.
“While we may encourage tenants away from pre-payment metres and their higher tariffs, the reality for those we've interviewed is that due to escalating costs of fuel, combined with other financial challenges, pre-payment is the only way they feel able to manage money without going in to debt with providers. People also have little confidence in financial institutions, and additional charges they may incur, which is already causing problems with the roll out of Universal Credit.”
The key findings from the second interviews also reveal:
- Nervousness about the introduction of Universal Credit, with a preference for continuing to have rent paid direct to Riverside
- Lack of skills in using the internet to complete Universal Credit applications
- Lack of financial acumen and little confidence in current systems
- The gradual eating away of disposable income due to rising prices especially heating, food and utilities
- Worries about gaining or maintaining employment, especially for those living alone, who feel particularly vulnerable to income changes
The study reveals that tenants have few prospects for long term employment and an increasing uncertainty of keeping current jobs.
Hugh Owen added:
“Thee government sees employment as the answer to people living on benefits and I agree that this is the best long term solution. Many of our tenants are desperate to find secure employment, but opportunities are scarce, especially for those with limited skills or health and care issues. Despite the majority of tenants interviewed seeking employment, very few have managed to secure permanent jobs. And for those who did, the experience was short-lived.”
David Orr, Chief Executive of the National Housing Federation, said: “This important research shows the human impact of the changes to the welfare system. It is beginning to reveal the painful reality of everyday life for people struggling on very low incomes, in areas where jobs are scarce on the ground.
Tracking the lives of individuals across the country for three years, this study is already proving to be a crucial addition to the evidence that welfare cuts and the rising cost of essentials are causing people real hardship.”