Government has made fuel poverty worse, says peer

Former Coal Board chief Lord Ezra criticises plans to scrap scheme that gives grants to the vulnerable

A Liberal Democrat peer will today accuse the Government of worsening the fuel poverty scandal. Lord Ezra, the party's former spokesman for energy matters, will criticise plans to scrap a scheme that gives the vulnerable grants for helping with insulation and heating improvements.

He will ask in the House of Lords what the Government intends to do to help those in fuel poverty. In an exclusive interview with The Independent, Lord Ezra – a former chairman of the National Coal Board – warned that the Government's proposed new Green Deal will actually make things worse for those in fuel poverty.

He also called for an investigation into energy company profits to find out whether they make the right investments to benefit consumers rather than simply lining the pockets of their investors.

Lord Ezra said: "The problem with the Green Deal is that it will leave the energy-poor in the same position they already are in terms of bills. It's a wonderful idea for those that can afford it, but it doesn't help the fuel-poor."

Vulnerable people are currently getting financial help through a Government-funded scheme called Warm Front. It pays up to £3,500 towards the cost of the home improvements or up to £6,000 for homes not connected to mains gas.

That scheme is due to end next year, and Lord Ezra intends to ask in the House of Lords this morning whether the Government has any further measures in mind to deal with fuel poverty. "It's a very important issue," he said. "A fifth of households are in fuel poverty, which means they have to spend on heating 10 per cent or more of their total income.

"The issue has been recognised by governments for many years but the recent spate of fuel prices increases has made it a much more serious problem."

Lord Ezra said a measure within the Green Deal called the Energy Company Obligation, which will compel energy firms to provide free help for those in fuel poverty, will in fact force up energy costs for all. "The cost of that help will have to be recovered through energy bills. It means everyone will have to bear that extra cost, including those in fuel poverty," he said.

He also called for the energy firms to be investigated to ensure they weren't putting shareholders before consumers. "They're utility companies. They should be considering consumers first, in my opinion," he said.

"Energy companies should be investigated to see what extent they use their profits to the benefit of shareholders or to the benefit of consumers through more investment. f they are unduly benefiting their shareholders, that is unreasonable."

He also called into question the Government's commitment to eradicate fuel poverty by 2016. "There's some doubt about whether they can achieve this," Lord Ezra said. "One of the points I will be making when I put my question to the House of Lords is that I will ask the Government whether they still remain committed to this and what is the likelihood of achieving it."