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Fuel Poverty (Target, Definition and Strategy) (Scotland) Bill

Overview

This Bill from the Scottish Government sets out:

  • a new definition of fuel poverty
  • a new target to reduce fuel poverty in Scotland

Fuel poverty is driven by:

  • energy costs
  • household income
  • how energy efficient household appliances and systems are
  • how people use energy in their home

The target is for no more than 5% of Scottish households to be in fuel poverty by 2040.

The Bill will also:

  • define fuel poverty in a way which is more aligned to income
  • require the Scottish Government to publish a fuel poverty strategy, and to report on its progress every 5 years

You can find out more in the Scottish Government document that explains what's included in the Bill.

Why the Bill was created

The previous target that was set in 2001 was not met. It aimed for no fuel poverty by 2016, but over a quarter of households are still in fuel poverty. This is in spite of Scotland being an energy-rich country.

A number of issues – mainly rising energy costs – have meant that fuel poverty levels have been increasing.

The new definition of fuel poverty means that it is much more to do with people’s incomes and cost of living, rather than the size of their home.

People living in fuel poverty are at greater risk of health problems like:

  • respiratory and cardiovascular illnesses
  • poor infant weight gain
  • more frequent and severe asthmatic symptoms
  • increased depression and anxiety

You can find out more in the Scottish Government document that explains what's included in the Bill.


The Bill at different stages

'Bills' are proposed laws. Members of the Scottish Parliament (MSPs) discuss them to decide if they should become law.

Here are the different versions of the Bill:

The Bill as introduced

Fuel Poverty (Target, Definition and Strategy) (Scotland) Bill

The Scottish Government sends the Bill and the related documents to the Scottish Parliament.

Bill is at ScottishParliament.SC.Feature.BillComponents.Models.BillStageModel?.DefaultBillStage?.Stage_Name stage.

Stage 2 – Changes to detail

Fuel Poverty (Target, Definition and Strategy) (Scotland) Bill with Stage 2 changes

Second version of the proposed law with changes from Members of Scottish Parliament (MSPs).

Bill is at ScottishParliament.SC.Feature.BillComponents.Models.BillStageModel?.DefaultBillStage?.Stage_Name stage.

Where do laws come from?

The Scottish Parliament can make decisions about many things like:

  • agriculture and fisheries
  • education and training
  • environment
  • health and social services
  • housing
  • justice and policing
  • local Government
  • some aspects of tax and social security

These are 'devolved matters'.

Laws that are decided by the Scottish Parliament come from:

Government Bills

These are Bills that have been introduced by the Scottish Government. They are sometimes called 'Executive Bills'.

Most of the laws that the Scottish Parliament looks at are Government Bills.

Hybrid Bills

These Bills are suggested by the Scottish Government.

As well as having an impact on a general law, they could also have an impact on organisations' or the public's private interests.

The first Hybrid Bill was the Forth Crossing Bill.

Members' Bill

These are Bills suggested by MSPs. Every MSP can try to get 2 laws passed in the time between elections. This 5-year period is called a 'parliamentary session'.

To do this, they need other MSPs from different political parties to support their Bills.

Committee Bills

These are Bills suggested by a group of MSPs called a committee.

These are Public Bills because they will change general law.

Private Bills

These are Bills suggested by a person, group or company. They usually:

  • add to an existing law
  • change an existing law

A committee would be created to work on a Private Bill.

Introduced

The Scottish Government sends the Bill and related documents to the Parliament.

Fuel Poverty (Target, Definition and Strategy) (Scotland) Bill as introduced

Related information from the Scottish Government on the Bill

Scottish Parliament research on the Bill 

Stage 1 - General principles

Committees examine the Bill. Then MSPs vote on whether it should continue to Stage 2.

Have your say

The deadline for sharing your views on this Bill has passed. Read the views that were given.

Who examined the Bill

Each Bill is examined by a 'lead committee'. This is the committee that has the subject of the Bill in its remit.

It looks at everything to do with the Bill.

Other committees may look at certain parts of the Bill if it covers subjects they deal with.

Who spoke to the lead committee about the Bill

Video Thumbnail Preview PNG

First meeting transcript

The Convener

Before we begin item 3, I put on the record my thanks to all those people who came to meet us at Lochee community hub in Dundee to talk about their experiences of fuel poverty. Alongside hearing from experts such as the witnesses we have before us today, we also hear from those who have lived experience. We are grateful that so many people took the time to come to meet us on Monday.

Today is the first day of stage 1 of the Fuel Poverty (Target, Definition and Strategy) (Scotland) Bill, and we will be taking evidence on the bill from now until the end of December before reporting to Parliament early in the new year.

I welcome today’s witnesses: Elizabeth Leighton, director of the Existing Homes Alliance Scotland; Craig Salter, a policy officer at Citizens Advice Scotland; Linda Corbett, an energy adviser at East Ayrshire citizens advice bureau; Norman Kerr, director of Energy Action Scotland; and Dion Alexander, the chairman of the Highlands and Islands housing associations affordable warmth group. I thank you all for your submissions. We go straight to questions.

What is your view on the main drivers of fuel poverty and the degree to which each driver contributes to overall fuel poverty rates and levels?

Norman Kerr (Energy Action Scotland)

We have mainly talked about three drivers. We have only really started to consider the fourth driver within the past year or two. The extent to which how energy is used in the home is a contributory factor has not been well measured or defined, although we know that behaviour change can reduce bills by around 10 per cent if people amend how they use appliances or set their heating. It is a contributory factor.

The measurement of energy efficiency across Scotland has been drawn from the Scottish house condition survey. We have seen energy efficiency levels rise over a period of time.

Scottish Government statistics have shown that increasing income has a better outcome than increasing energy efficiency in the shorter term. However, given that fuel prices continue to increase, we need to—pardon the pun—insulate homes against rising costs. The more energy efficient the home, the less energy it will use.

The Convener

You are allowed to make one pun per visit.

Norman Kerr

Good. I declare that as my pun.

It is a complex interaction and, just because we sort one element, that does not mean that the others will fall into line.

Craig Salter (Citizens Advice Scotland)

I second what Norrie Kerr has just said. I will give a bit of insight into the impact of behaviour change. In the past year, we have carried out a lot of research into the support needs of people who are in fuel poverty, particularly the forms of support that people who rely on electric heating require. We know that there are high levels of fuel poverty among people who have electric heating because of high costs.

One of the things that we see in that research is that how a lot of people use their heating has a big impact on their heating bills. We see a lot of people who have storage heating but do not necessarily know how to use it, and a lot of people who have time-of-use tariffs and dynamically teleswitched tariffs and meters that they do not necessarily understand, so they use their heating at the wrong times. That perhaps tells us that behaviour change is complex and can apply differently in different circumstances. It is definitely an area in which we need to get more evidence, but it has a big impact on certain groups.

Elizabeth Leighton (Existing Homes Alliance Scotland)

We welcome the fact that the strategy is looking at all four drivers of fuel poverty. We particularly welcome the Government’s commitment to removing poor energy performance as a driver of fuel poverty. Doing that is within the powers of the Scottish Government and it is high time that poor energy performance is removed as a reason for fuel poverty. We can do that; there is no technical reason why it is not possible. It is a matter of investment, planning and, as we know, working on behaviour change to maximise the impact of whatever measures are put in place.

At the same time, we recognise that work has to be done across all the drivers of fuel poverty, which is why we have argued that any progress reports, measurements and targets should reflect the four drivers and should report on outcomes across the board.

The Convener

Before I bring anyone else in, I want to mention something that you talked about. The Scottish Government has limited powers in areas such as fuel prices and household income. Is it wise to set a fuel poverty target when we do not have control of all the drivers?

Elizabeth Leighton

The Scottish Government can push the boundaries of its powers, which have grown in the past few years. It has more powers in social security and it is exploring how it can affect energy prices through supporting community energy or a publicly owned energy company. There are areas—even reserved areas—where we can push the boundaries. The Government can set those targets, and ambitious targets drive innovation and investment and provide certainty for the supply chain to invest, which can help to drive down prices in the longer run. We believe that ambitious targets are achievable.

The one thing that I thought that I had to say today is that we have to be sure that this bill will mean that this is the last generation that will live in fuel poverty. If we cannot walk away from this session confident that that is what we are setting out to achieve with the bill, we will have failed.

Linda Corbett (East Ayrshire Citizens Advice Bureau)

I would like to talk about fuel prices. At Citizens Advice Scotland we very much welcome the cap on the charges for prepayment customers and the safeguard tariff that is being rolled out, particularly for those on the priority services register. However, I think that it falls short of the mark, when it could actually be a very useful tool to help to pull people out of fuel poverty. At the moment, when someone is on the priority services register, it is because of vulnerabilities in relation to health conditions. However, we are doing a disservice to those who are financially vulnerable but who do not necessarily have health conditions by not allowing them to be included in the register which, as I said, opens up access to the safeguard tariff. There is definitely work to be done on our understanding and definition of vulnerability. We should look not only at health and age but at how quickly people can move from one state of vulnerability to another, and at how that can compound their experience of fuel poverty.

Norman Kerr

I want to mention a couple of things. The Scottish Government is now taking more powers over social security and—although it does not control energy price—over the energy company obligation and through that, over the warm home discount scheme. The Scottish Government administers, and could change, that scheme. For example, it might want to lift the level that is applied in a remote and rural area and reduce it in an urban area, so that the same amount of money is spent. There can be a recognition that, in certain parts of Scotland, it is more difficult to heat your home.

The second thing that I want to mention is not particularly new. The social security powers in the mid-1980s acknowledged the needs that are associated with certain house types. Some members may be familiar with bits of Glasgow and, in particular, with the Barrowfield estate, which was designated as a hard-to-heat estate; everyone on that estate received an uplift per week over the winter season through their social security payments. Therefore, there is a recognition that additional payments can be made using social security powers to mitigate fuel prices in winter.

The Scottish Government may not have access to all the drivers, but it has access to some that would certainly mitigate fuel costs in particular.

Dion Alexander (Highlands and Islands Housing Associations Affordable Warmth Group)

I have one specific response on the wisdom of fuel poverty targets. In our submission, we say that it would be helpful to continue to measure extreme fuel poverty. At the moment, there is basic fuel poverty which, under the old definition, is having to spend 10 per cent of income to keep your home warm, as you know. Extreme fuel poverty is having to spend twice that or more. In our submission, we ask that extreme fuel poverty should continue to be measured, because it will provide a guide to what is going on in the elimination of the worst forms of fuel poverty. We say very firmly that extreme fuel poverty is intolerable in a civilised society and that it should be eradicated as quickly as possible—within five years.

As for the main target on fuel poverty, we completely take the point that not all the drivers are within the powers of the Scottish Government. Nevertheless, we think that it should be possible to reduce the level to about 5 per cent. You are always going to have people popping in and out of fuel poverty, no matter where you get to, so 5 per cent is not an unreasonable figure for basic fuel poverty.

10:15  

To go back to the main drivers of fuel poverty, I imagine that we will discuss in more detail the question that we have raised in the rural and remote rural context about the level of disposable income and why the definition of fuel poverty needs to reflect that properly through the minimum income standard, which we support. A driver of fuel poverty is the lack of trusted local support in some areas, particularly remote rural areas. It is quite revealing to look at the map that the Scottish Government produced of the home energy efficiency programmes for Scotland area-based schemes—HEEPS ABS—successes and otherwise for 2015-16, for example. That shows some surprising gaps in areas where we would have expected there to have been high activity.

To say that there is a lack of trusted local support does not mean that the support is not excellent where it exists or that there are not good, helpful national services. However, what works best in solving the problems in remote rural areas is having people available to go into the homes of people who would not otherwise think that they deserved any help at all, such as the old lady who lives in a croft house at the end of a lane somewhere. I hear many such examples in which that availability has made a difference.

That begs a question about the lack of reliable funding to maintain trusted support. People are looking around for funding in a hand-to-mouth way—there is a lot of that going on. An effective new fuel poverty strategy should look seriously at the public funding commitment to ensure that the proper outreach is provided in areas in which it is most needed.

Graham Simpson (Central Scotland) (Con)

Before I get to the questions that I wanted to ask, I want to ask Linda Corbett a follow-up question. She mentioned the safeguard tariff. As the convener said, three of us visited Dundee this week. We met a lot of people who prepay their electricity and gas, and we heard about issues relating to that. What is the safeguard tariff?

Linda Corbett

It is a tariff that is set for credit customers. Prepay is slightly different. With prepay, there is a cap on the maximum amount that can be charged per unit of gas and electricity. The safeguard tariff is essentially the same, but it is for people on a credit meter as opposed to a prepay meter.

Graham Simpson

That is useful.

I have a couple of linked questions about the bill, so the witnesses can answer them in a linked way. What do you think of the 5 per cent target? Should the target be more ambitious? That target has to be achieved by 2040, which is 22 years away. I think that all of you said in your written evidence that that is not ambitious enough. The two issues are linked. What do you think about the 5 per cent target and the date of 2040?

Elizabeth Leighton

In our evidence, we came out very strongly in favour of a much more ambitious target. As I said earlier, the bill should ensure that the generation that is now living in fuel poverty is the last. We have called for the date to be moved forward to 2032. That aligns with work that is being done in relation to the Climate Change (Emissions Reduction Targets) (Scotland) Bill and the climate change plan. We have also called for the target to be zero per cent—to eradicate fuel poverty as far as is reasonably practicable. We acknowledge that there are people who move in and out of fuel poverty and that we might not be able to get that down to absolute zero. There will be particular times when that is not possible, but we think that that is a reasonable position and that that is an achievable and credible target for us to strive for.

I support what Di Alexander said. Levels of extreme fuel poverty should continue to be measured. We may be able to look for examples from the Child Poverty (Scotland) Act 2017, which talks about “persistent poverty”. The risk is that, if we allow for 5 per cent, those people will be the most difficult, hardest and most expensive to reach, and they will just be left behind. We cannot be in a position where we say that it is okay for that 5 per cent to continue to live in fuel poverty in 2040—surely that is unacceptable.

Craig Salter

I agree with what Elizabeth Leighton just said. We understand the logic of the 5 per cent target. As Dion Alexander said, there is a transient element to fuel poverty. However, if that is the target to be met, there has to be a commitment to an ambition to continue or even step up work to reduce the percentage of households in fuel poverty to zero. If that 5 per cent of households are hard to reach or have a greater support need, more resource has to be put towards supporting them.

We agree that the 2040 target date is too far in the future. It would mean a reduction of 1 per cent per year, which does not reflect the progress that we have seen in recent years and it is 22 years in the future. We, too, would support a target date of 2032. That would bring the fuel poverty target in line with some of the ambitions that have been set out around energy efficiency, such as improving the energy efficiency of social housing and improving general energy efficiency standards.

As discussed, there are four drivers of fuel poverty. If we have a target, for all intents and purposes, to remove poor energy efficiency as a driver of fuel poverty by around 2032 and then, eight years later, there is a target to completely eradicate fuel poverty, we risk an undue focus—as there has been in the past, to an extent—on energy efficiency alone, so that the other drivers of fuel poverty are left until later.

As has been pointed out already, all the drivers of fuel poverty interact. They all have a significant impact and, as a result, they all need to be addressed together. If we are saying that we can achieve improvements in energy efficiency by 2032, work should be on-going alongside that to address the other drivers too. In that regard, 2032 is an achievable target.

Norman Kerr

In 2016, the level of fuel poverty was at 27 per cent. If you apply the proposed new definition, it comes down to 24 per cent, so there is a 3 per cent drop by changing the definition. If we start with that 24 per cent figure and we aim to meet the 5 per cent target for 2042, a further 19 per cent of people need to be brought out of fuel poverty. If we keep to a 20-year programme that starts in 2020, that is less than a 1 per cent improvement every year.

That is certainly not ambitious. That target could be achieved through business as usual, if we continue to change how we measure people who are in fuel poverty. The Scottish house condition survey has already changed its methodology three times—in 2011, 2014 and 2016. We continue to change the methodology and each time we have seen fuel poverty figures drop. Our worry is that changes will continue to be made that do not actually mean anything, other than that we are not providing enough support to homes. We could manage down the apparent levels of fuel poverty by continuing to change the definition and manipulating the data we collect.

Linda Corbett

I will reflect on some of the comments from the other panel members. I agree with the 5 per cent target and with the 2032 target, again with a secondary target stretching to 2040. That is because I would like fuel poverty strategies to be embedded and not simply removed once a target is reached—it must be an on-going thing, particularly for rural and outlying areas, where there are small communities that learn from each other. Behaviours are a learned thing and we would like to see fuel poverty strategies enter education. We want to look at how we can support young people to understand energy efficiency and how to behave in an energy efficient way so that, rather than needing to remove them from fuel poverty in the future, we can avoid their getting into fuel poverty in the first place. I welcome the 2040 target, but there should be a bit more ambition. As Craig Salter and Norrie Kerr said, 2032 would probably be more realistic.

Norrie Kerr talked about the 19 per cent figure. By the time that we come to 2020, a reduction of a lot more than 19 per cent will be needed. The 24 per cent fuel poverty figure has been skewed by the massive fluctuations in energy prices, and particularly the drop around the time that the house condition survey was done. Obviously, we have had massive increases since then, particularly in standing charges, so I expect that there will be a bit more work to do than dealing with 19 per cent.

Dion Alexander

We, too, support a programme of 14 years, which matches the one that the Parliament instigated in 2001-02 and which terminated in 2016. We see no good reason for the period to be any longer than that. I have referred to extreme fuel poverty and the good grounds that exist for there being a target on that as well, and for eliminating it pronto.

With my Highlands and Islands hat on, I make the point that the Scottish house condition survey statistics for local authorities show that, under the existing, or so-called old, definition, 50 per cent—a half—of all households in the Highlands and Islands are in fuel poverty. There has to be a concerted attempt to recognise the places that have the highest levels of fuel poverty and the difficulties that have been faced in eliminating fuel poverty in those areas. In effect, the figures have been flatlining for years in those areas, which suggests that a new and better approach is needed to ensure that the target is reached there.

Norman Kerr

Mr Simpson asked about the safeguard tariff. We need to bear it in mind that that is a temporary measure. Our worry about the safeguard tariff and the prepayment tariff caps is that those will in some way amend household behaviour in the wrong direction. In other words, people will think that the Government is protecting them by applying a cap, and they will be less likely to switch supplier, to shop around for a better deal or to change their payment method. The safeguard tariff is a short-term measure and even Ofgem—the Office of Gas and Electricity Markets—admits that it is not sure of the impact on switching rates. If we want people to find better deals and lower prices, we have to recognise that any tariff cap can be only a temporary measure and we must continue to support householders to view their energy bills and consider how to reduce them rather than simply sit back and think that they are protected, when they may be paying far too much.

Graham Simpson

I want to go back to the 2040 target. It is a long way away but, in the policy memorandum, the Government says that achieving it

“will require the use of cost-effective low carbon heating”.

As you all know, most homes do not have that, so to roll it out nationwide would be a massive project, which I presume is why the Government has picked 2040. Under those circumstances, is that date not reasonable? I can see that Mr Kerr is itching to come in. You have all said that it should be 2032. Either that is plucked out of thin air or it is based on something. Perhaps you can explain where you got the date of 2032 from and why the Government is wrong, given that it will take an awful lot of work to get low-carbon heating in all homes.

The Convener

Before the witnesses respond, I ask them to keep their answers a bit shorter, because we have a lot to get through and we have only an hour to get through it.

10:30  
Norman Kerr

We do not necessarily need to put low-carbon heat and fuel poverty together. A low-carbon heat source will not in itself solve fuel poverty. The electricity grid in Scotland is now mainly low carbon. We will have our gas grid for many years to come and we will not replace it, although we are looking at technologies that reduce the amount of carbon in the gas mix, such as biofuels and a range of other mixes, including hydrogen. However, simply giving someone low-carbon heat does not take away the fact that they are fuel poor. It may actually contribute to their fuel poverty if there is a significant additional cost of the technology that is applied to gain that low-carbon heat, such as completely stripping out the gas grid and moving to electricity alone for heating.

We need to scale up the ambition. We could all say that 2040 sounds absolutely fine, but that would not give a step change in productivity levels or in the number of homes that are tackled each year. In all honesty, it condemns another generation to live in fuel poverty. The 2032 target is based on what we can reasonably expect in a number of parliamentary sessions and with an increase in the budget. I am sorry that my answer is exceptionally longer than you had hoped for, convener, but, if we maintain the budget at its current levels, that is what we will get. Some time ago, Energy Action Scotland talked about a need for £200 million a year. That is a very old figure, but we have never achieved that level of expenditure. We are way behind and we need to raise our game significantly.

The Convener

We will move on. Alexander Stewart has a question.

Alexander Stewart (Mid Scotland and Fife) (Con)

There has been lots of discussion of the new definition of fuel poverty, and it has been mentioned this morning. What is your view on the new definition? Is it an improvement? If so, why? If it is not an improvement, why not?

Dion Alexander

It is a bit like a curate’s egg, in that it is good in parts. We welcome the fact that we have a fuel poverty bill, and we are more than happy to have a re-examination of the definition, because the definition logically underpins the work that flows from it to give the evidence base to show what is happening across the board in relation to fuel poverty. It will therefore enable the proper evidence-based development of policies and programmes to address the problems and all but eliminate fuel poverty in a way that previous fuel poverty strategies have failed to do.

We welcome the fact that the minimum income standard is being used to underpin and inform the evidence-based understanding of poverty and the amount of disposable income that people have. However, for us in the Highlands—many other organisations have made exactly the same point—it falls down badly and radically undermines the whole approach, by not using all the available minimum income standard evidence.

As you are aware, evidence has been gathered for remote rural Scotland on exactly the same basis as for the minimum income standard UK data. It was first gathered in 2013 and refreshed in 2016. We are saying, “Please, please use this evidence.” The independent panel of academics that came up with the new fuel poverty definition recognised that there was a particular problem in remote rural areas of Scotland and suggested an uplift, in the same way, for example, that we have a London uplift on the MIS UK data when it is used to inform the living wage. We are asking people to do the same thing for remote rural Scotland, because we know from the MIS remote rural Scotland data that, depending on their household type and location, families in remote rural areas need between 10 and 35 per cent more income to achieve the same basic level of income as those in households elsewhere. That has to be a fundamental contributor to fuel poverty; it is not the only contributor, but it must be recognised in any definition if that definition is to have credibility and serve the purpose for which it is designed.

Craig Salter

Di Alexander is absolutely right. We support the new definition, with the proviso that the minimum income standard for remote rural areas must be included. Our research has backed up a lot of what organisations such as Highlands and Islands Enterprise have come out with, which is that, as Di Alexander says, incomes that are 10 to 40 per cent higher are required.

Last year, CAS commissioned qualitative research on the support needs of households that were defined as being fuel poor. One of the interesting things that came out of that was that the groups that self-identified as having a significant need for fuel poverty support corresponded quite closely with the groups that were more likely to be defined as fuel poor under the Scottish Government’s impact assessment, based on the new definition. There was one exception to that, which was households in rural areas. Households in remote rural areas, in particular, said that they needed all sorts of advice and financial support. The fact that that was the one group that did not correspond with what was in the impact assessment suggests that that is the one area where there is a need for fundamental change.

Alexander Stewart

You believe that if that change is not made to the definition, it will be flawed because it will not include people in remote rural locations.

Craig Salter

I think so, yes.

Kenneth Gibson (Cunninghame North) (SNP)

I have so many questions that I will not have time to ask them all. I represent more than 6,000 island constituents and I support the position on the minimum income standard. Does the panel believe that when we look to tackle fuel poverty there should be additional emphasis on island and rural communities to bring them down, if you like, to the average proportion of people that suffer from fuel poverty? Some local authorities might have 10 or 15 per cent fuel poverty, but in Highland and remote authorities it might be 30 or 40 per cent. Should there initially be a specific focus on putting additional resources into those areas to reduce the level of fuel poverty at least to the Scottish average? Would the panel support such a measure?

Linda Corbett

In East Ayrshire, we are not remote rural, but we certainly have some rural areas, and we see particular difficulties with access to support services. One of the main difficulties for people in rural areas is access to finances in order to travel; another is access to transport to make the journey to reach the support services. Such people often end up living in isolation. They look to neighbours, friends and family for support, but those people tend to be in exactly the same position. We need something in the strategy that identifies that people in those groups potentially need extra support.

Kenneth Gibson

Elizabeth Leighton and others on the panel said that the Scottish Government needs to be more ambitious, but the Scottish Government does not have much control over income, pensions being an obvious example.

Even if the Scottish Government set up its own energy company and sold fuel at cost, we would still be subject to world prices. How realistic is it to reduce fuel poverty year on year? The previous strategy was not successful, and despite its best efforts the Scottish Government is buffeted by external factors.

The panel members have all said that the Scottish Government is aiming to reduce fuel poverty by only 1 per cent a year. However, if we reduce the number of people in fuel poverty from 600,000 to 140,000, that will be a 77 per cent reduction. That is more like 4 per cent per year.

Elizabeth Leighton

On the ambition, although I commend the Scottish Government and this Parliament for having such a strong commitment to the eradication of fuel poverty and for having had, over the years, a series of programmes to address the issue, which have mainly addressed energy efficiency, I argue that we should learn from the lessons of the past and consider why fuel poverty has not reduced as much as it should have done.

Let us learn from programme evaluation, which has not been done until fairly recently. Let us look at how forming the types of partnership that the strategy envisages could make programmes more effective, and let us consider greater investment—yes, it comes down to numbers in the budget—not just in delivering measures but in before and after care, in helping people to understand how to manage their energy more effectively, by switching and so on. If we seriously want to eradicate fuel poverty, it will require greater investment.

As Norrie Kerr said, we have to up our game. It requires a step change. If we are going along with a business-as-usual budget and a business-as-usual strategy, we will have business-as-usual results. The whole point of the bill and the strategy, following the work of the Scottish rural fuel poverty task force and the Scottish fuel poverty strategic working group, is to change our approach, building on what we have been doing and improving.

Kenneth Gibson

The submission from the Existing Homes Alliance was excellent, as are all the submissions. You said:

“We ... note the positive results from research undertaken by the Energy Agency and NHS Ayrshire and Arran”—

that is my area—

“where preliminary analysis of the health impacts of the area-based solid wall insulation schemes suggests lower hospital admission rates for respiratory and cardiovascular related conditions in these areas compared with a control group of postcodes who had not yet participated in the scheme.”

Have you had discussions with the Scottish ministers about, for example, the possibility of switching national health service resources into fuel poverty reduction? You have proposed a budget increase from £110 million to £234 million a year, which looks quite ambitious on the face of it, but we might save the NHS money by investing in fuel poverty. I know that Norrie Kerr has talked about that over the years. Have you discussed the issue with ministers and had a positive response? Is it being considered?

Elizabeth Leighton

It is certainly something that we have raised, in that we have asked whether we should be looking more globally at the budget. Fuel poverty should not just come under housing; we need to consider more broadly where the other benefits come from and who else should be investing in reducing fuel poverty. It goes beyond health, of course, to economy, because of all the jobs that could be created and sustained if we had an ambitious programme, just on the energy efficiency side of things.

You are right, in that we are starting to see hard evidence of the health benefits. NHS Ayrshire and Arran has been a leader, working with the Energy Agency, in demonstrating that. We need more of that evaluation to be done, so that we have the evidence and can cost the benefits to the NHS. Previous research has indicated that there could be savings to the NHS of up to £80 million a year—let alone the health and wellbeing benefits to individuals.

That is why we were so disappointed by the financial memorandum, which fails to look at the cost of reaching the target, whether we are talking about a target to have 5 per cent of households in fuel poverty by 2040 or a target of true eradication. What is the cost, and how will we meet it, through public investment and private investment, and by bringing in other Government policies and portfolios? We are disappointed that the Finance and Constitution Committee is apparently not going to report on the financial memorandum, although that is one of the questions that we think it should look at—not just the amount of the budget, but where it comes from.

10:45  
Kenneth Gibson

My final question—I thank the convener for his indulgence—is also for Elizabeth Leighton. I am sorry that I am focusing on one individual, but I want to discuss a point that is made in the Existing Homes Alliance Scotland submission. It says:

“the Scottish Government has stated in the Draft Fuel Poverty Strategy that it will develop ‘...if appropriate, a wider Energy Efficient Scotland Bill for later in this Parliament, and this would be the vehicle for any further legislative changes needed to support Energy Efficient Scotland, beyond the fuel poverty provisions contained in the Fuel Poverty (Target, Definition and Strategy) (Scotland) Bill’.”

Do you feel that the bill represents a missed opportunity and that it should be much more rounded? Other members of the panel may wish to comment on that, too. Instead of our looking to have another bill a year or two from now, should everything be contained in one bill? If possible, would you like additional provisions in the bill that we are discussing?

Elizabeth Leighton

The bill’s genesis was as a warm homes bill. It was about warm, low-carbon, affordable homes for everybody in Scotland, so we were disappointed when a decision was taken to make it focus only on fuel poverty. We welcome the focus, but it is limited. The opportunity has been missed to support it by providing a complementary statutory underpinning for the energy efficient Scotland programme, which is very much needed in order to provide ambition to deliver on the removal of poor energy performance as a driver of fuel poverty.

We know that there is consideration of a possible energy efficient Scotland bill. Perhaps we will hear more about that on Thursday, when, I believe, the minister will make a statement to Parliament. It will be positive if there is a firm commitment to such a bill and information on what it will contain. Failing that, the bill that we are discussing provides a perfect opportunity to take the matter forward in a timely fashion and in a way that supports achievement of the targets.

Andy Wightman (Lothian) (Green)

On that point, we have written evidence from the energy poverty research initiative and Common Weal, which says that they are

“disappointed that the Scottish Government has chosen to ignore the consensus at the expert workshop”

in 2017

“that the finalisation of the new definition should be postponed for two to three years to allow the development and inclusion of a robust Scottish definition of vulnerability in the new definition of fuel poverty.”

We have some conflicting evidence, but we will need to deal with that.

Dion Alexander said that the definition should underpin everything that will flow from it. It should be the evidence base for, I presume, the strategy, the implementation and delivery against the target. I have a general question about how we go about measuring fuel poverty. Information comes from the Scottish house condition survey and there is a modelling exercise that, as far as I can see, measures fuel poverty by local authority area. We have a map in the Scottish Parliament information centre briefing that shows that.

Dion Alexander has asked for an uplift to the minimum income standard in relation to remote rural Scotland, and he mentions in his submission a better alignment with the urban/rural classification. First, how well can the current measurements of fuel poverty align with the geography of Scotland? Secondly, if the bill is passed as it stands, will it help us to prioritise and to plan where and how we are going to spend money?

Dion Alexander

Does it align with the geography of Scotland? It could do better, particularly in relation to the way that information is gathered according to the Scottish Government’s sixfold urban/rural classification system. In effect, categories 1 and 2 are the cities, categories 3 and 4 are towns and categories 5 and 6 are rural settlements—that is to say, settlements of 3,000 people or fewer. Category 5 settlements are within half an hour’s drive time from a major conurbation and category 6 is remote rural areas that are more than half an hour’s drive time from a major conurbation.

Information is gathered to an extent on those two rural categories but, often—as has been the case in relation to fuel poverty—it is globalised, as it were, and presented as being to do with rural areas in general rather than with category 5 and category 6. It is aggregated. We are saying that, henceforth, all information should be gathered so that we can see clearly what is happening in category 5 and in category 6—in other words, in accessible rural areas and remote rural areas. It is commonly recognised, not least by the panel of academics who came up with the new definition, that remote rural areas are where the greatest problems are.

My colleagues have already made the point that we need a much better understanding of outcomes. A lot of assumptions are made on the basis of inputs—that is to say, people assume that energy efficiency inputs will necessarily equate to affordable warmth outcomes. However, that is not the case. Experience shows that, too often, an energy efficiency input does not necessarily mean that the person who is living in the house ends up achieving warmth at a price that they can afford, so they still have a problem.

To complement the much better understanding of what is going on in remote rural Scotland as well as accessible rural Scotland, we need an improved understanding of the outcomes. I hope that the new fuel poverty strategy will take that question seriously so that we can have a much better understanding of what works and what does not work. One of the major weaknesses of the fuel poverty strategy is that it has not looked nearly closely enough at real outcomes in terms of affordable warmth.

Forgive me, but I have forgotten the second part of your question.

Andy Wightman

Others can answer the second part of my question, too, if they like. If I am a policy maker in the Scottish Government in five years’ time and I want to eradicate fuel poverty on Skye, will I be in a better position to do that after this bill is enacted than I am today?

Dion Alexander

You will not be, unless you really think hard about it from the perspective of the people who need the help and work out what kind of help works best for them. The experience of the Highlands and Islands—I have come across the issue in other places, but that is the place that I know best—shows that what works best is tackling the problem on the front line by having skilled and trusted fuel poverty alleviation people based in the community, such as those in the Lochalsh and Skye Housing Association’s energy advice service, so that they can find people and ensure that nobody is missed out.

They do that by building trust, using word of mouth and by going into someone’s house and looking at all the things that are causing that household to have difficulty, which can involve the fact that the fabric of the property needs improving; that more insulation is needed; that the heating system needs changing; that there is a problem with the electricity tariff, which is a feature of remote rural areas, as they are, essentially, off the gas grid; or that they are not using the system as well as they could be. The fuel poverty alleviation people can provide the handholding support that someone might need, particularly if they are elderly and independent-minded or if they simply do not understand what the system can offer them.

Where such a service can provide a mix of technical advice and a form of support that is almost like social work—I do not mean that in a demeaning way, but it is a fact that some people need a lot of handholding—that works extremely well. That is the way to get to grips with the problem. That requires resourcing and revenue funding to ensure that that effective outreach takes place.

Andy Wightman

In effect, you are saying that the bill will not make a difference to that; it is about how we implement things on the ground.

Dion Alexander

That is right. Clearly, there is—

The Convener

Keep it short, Mr Alexander.

Dion Alexander

Sorry, convener.

Andy Wightman

That is fine. Just on—

The Convener

Mr Kerr wants to come in.

Norman Kerr

Mr Wightman talked about measurement. The Scottish house condition survey uses BREDEM 2012—Building Research Establishment domestic energy model 2012—which has a number of anomalies. For example, in calculating fuel costs, it uses a Scottish average for oil, although oil prices in remote and rural areas are very different from inner-city oil prices. I suggest that, if we are going to use the house condition survey as our main touchstone, we must amend BREDEM to take into account a number of issues.

Another issue is that, as Mr Wightman rightly said, the survey results are by local authority area, which is difficult in a huge area such as the Highlands. However, using proxies—we will always use proxies—we can apply additional work that will get good figures down to ward level in certain areas.

The bill itself will not make it easier to target resources to fuel-poor households. When the minister talked about introducing the bill, he was looking for a doorstep tool, so that someone on the doorstep of a household could make an assessment of its fuel poverty. Given the complexity of the definition, that doorstep tool is nigh on impossible. It would have to take into account a person’s income and fuel costs and then work out the MIS. Therefore, a doorstep tool for an individual house is a non-starter, but we can amend BREDEM and we can do additional work that will move the information down to ward level, which would be more useful for local authorities.

Andy Wightman

I would be grateful if Mr Kerr could write to the committee with further thoughts on what that work would involve. That would be useful.

Norman Kerr

Certainly, I will do that.

Craig Salter

I agree with that point, but there is also something to be said around how the definition is used in budgeting. Obviously, if we have a more accurate definition, that could play a role in aligning fuel poverty budgets. How do we do that more effectively with the new definition compared to the old one? There is nothing in the bill that would make that easier. One solution could be a more in-depth requirement, either for a third party or for ministers, to report on the impact of each individual driver of fuel poverty, as well as the impact of measures to address those drivers individually, so that we can understand where the money needs to be spent. If we see that energy prices are holding back progress, we will know that money needs to go to innovation on that. That is a more general point, but a more accurate and detailed definition can play a role in budgeting.

Andy Wightman

We will come back to reporting and accountability, so I will leave it there.

The Convener

Liam McArthur has a couple of questions on that.

Liam McArthur (Orkney Islands) (LD)

As someone with the dubious honour of representing the part of the country with the highest levels of fuel poverty—Orkney—that is of particular interest. I congratulate the panel on the distinction of gathering such compelling evidence that the Government saw fit to issue its retaliation first, with an explanatory note. Even in that note, the Government appears to accept that the combined impact of the new definition and targets will be a greater reduction in the fuel poverty rate in urban areas when compared to rural areas.

The committee has heard concerns from everyone about the absence of the rural MIS, which goes against the advice of the rural fuel poverty task force and the independent expert panel, and against the wishes of pretty much every organisation that is involved in housing and fuel poverty across the Highlands and Islands. From the note, that decision appears to be based on the potential costs of including a rural MIS and the delays in implementing the system. What is the panel’s response to those two concerns, which the Government appears to be using to justify its position on the issue?

11:00  
Dion Alexander

The figure that is quoted in the paper is a cost of £0.5 million over four years. From my conversations with Professor Donald Hirsch of Loughborough University, who is the key person responsible for gathering minimum income standard data and who led the work on the MIS for remote rural Scotland, I think that he is surprised that it would need to cost that much, but I respectfully suggest that the only way in which the committee can bottom that out is to invite Professor Hirsch to give evidence and discuss the matter.

That raises the question as to whether it would be money well spent. Our view is that it would.

Norman Kerr

On the figure of £0.5 million over four years, if we amend BREDEM—there is a reference to the need to amend BREDEM—that will not be free, but that has not been costed. I think that the figure has been given to demonstrate why we should not apply a remote rural uplift, rather than why we should. In the great scheme of things, £0.5 million over four years is a drop in the ocean to get more accurate reporting that will enable us to dedicate resources to a particular area. I am sorry, but I think that the figure is a smokescreen.

Liam McArthur

In his written submission to the committee, Professor Hirsch said:

“Were this matter of a remote rural variation to be reconsidered in the course of the Bill, I can confirm that ongoing measurement of such a variation would be feasible with a modest amount of ongoing research to keep it up to date.”

He does not quantify that, but what he says suggests the order of magnitude that we are talking about.

Mr Salter talked about budgeting. Do you agree that, if we do not get the criteria right, we will not direct resources in the most efficient way?

Craig Salter

I absolutely agree. I cannot comment on the figure that the Scottish Government has put on that but, as Norrie Kerr and I both said, if we start from the wrong point, we will not be able to budget effectively and we will not get the outcomes that the bill tries to achieve.

I absolutely agree that it would be money well spent, if it ultimately meant that fuel poverty support got to the people who are in greatest need, in particular those who have, historically, found it harder to access support.

Liam McArthur

We have touched on the cost, but what about the delay? Do you envisage a delay, given what you have said about the need to crack on and have more ambitious targets?

Craig Salter

I have not seen any great detail from the Scottish Government about exactly what the delay would be and what would cause it. As far as I am aware, and as Di Alexander said, a lot of the work has already been done. There is Professor Hirsch’s work, and Highlands and Islands Enterprise has done extensive research on the matter.

Such exceptions or uplifts are already applied in other parts of the country, such as London. It appears to me that the problem should not be insurmountable. As Norrie Kerr rightly pointed out, in the Scottish house condition survey, methodologies are revised and applied retroactively so, even if there were a short delay, there is no reason why a remote rural uplift should not then be applied once the information is ready. A delay is not a reason not to do it.

Alex Rowley

What are the panel’s views on the principle of having a fuel poverty strategy and the timetable for producing it, given that it will probably come out in 2019, after the bill has been passed? What do you think of the draft fuel poverty strategy that was published alongside the bill?

The Convener

Please make your answers as brief as possible.

Norman Kerr

I will make a start. The strategy needs to be in place—the question is whether lessons have been learned from the previous schemes that will impact on it. The strategy is more focused on removing poor energy efficiency as the main driver, and we would like to see a lot more built into it for support services such as Citizens Advice Scotland that are doing the handholding. It is important that we have a strategy, but I do not think that it is wide enough. It is very narrowly focused.

Dion Alexander

In our submission, we spell out what we would like to see included in the preparation of the fuel poverty strategy. A lot of work has already been done on this by both the strategic working group, for which Elizabeth Leighton provided the secretariat, and the rural fuel poverty task force, which the Scottish Government convened and which I chaired. There is a lot of information available.

That said, a useful way of ensuring that the strategy delivers for remote rural Scotland is to island proof it, as per the requirements of the Islands (Scotland) Act 2018, which is all but in place now—I think that it has a few small stages still to go through. As I understand it, the minister, Kevin Stewart, has indicated that he is happy for the bill and the strategy to be island proofed as soon as possible, and I urge the committee to support that view, because that would be useful in making sure that the bill and the strategy do what they are required to do in practice.

Elizabeth Leighton

I have a couple of points. First, on the consultation requirements, we welcome the specific reference to getting the views of

“those with lived experience of fuel poverty”.

We think that that is positive, but their views should be gathered in order to report on progress, too. The consultation should be more co-designed instead of being a passive request for some input, with feedback wrapped in. Indeed, we have made extensive comments on that aspect.

Secondly, with regard to the content—and this goes back to my previous comments about business as usual—does the strategy contain specific policies or programmes that are different from those that we have now? We should build on what we have now, which has been successful, but if we are to make the step change towards accelerated progress, the strategy should contain new programmes and policies that use certain levers such as regulation or incentives or look at how explicit links are being made with other strategies such as the child poverty strategy or public health strategies. Those things should be evidenced in the fuel poverty strategy, so that we know that this will be mainstreamed across all of Scotland and not follow the current pepper-pot approach, which means that, if you are lucky, you might have funding for a year-long project to provide the kinds of services—the handholding and so on—that others have talked about. If you are not lucky, you do not have anything. We would like to see the strategy developed so that it moves on from where we are today.

Linda Corbett

On the consultation requirements and the reference to the “lived experience”, we would very much like front-line workers to be consulted, too, as it might give a good indication of the trigger points for when consumers approach a trusted intermediary, which includes organisations such as Energy Action Scotland, Home Energy Scotland, the Energy Saving Trust and, obviously, Citizens Advice Scotland. There is already a vast wealth of knowledge, and I am quite sure that many front-line workers in those organisations will be more than happy to pipe up and talk about their experience, too.

Craig Salter

I agree. There is also a lot of scope and a lot of options for setting out in more detail how the

“lived experience of fuel poverty”

is measured. As Linda Corbett has said, it is very important to speak to front-line workers, and quite a lot of work has already been done through the Scottish household survey. That could be expanded on to get more fuel poverty data.

The strategy sets out a commitment to addressing all four drivers of fuel poverty but, as I have said before, we need a lot more detail on how that will be done. We have talked a lot today about some of the limitations on Scottish Government powers; because of that, the strategy needs a lot more detail on what it will do to bring down energy prices and increase incomes.

We also had some thoughts on the vulnerability criteria. The academic review panel recommended that there should be on-going work to define vulnerability and produce a set of criteria that would include things such as health and disability as indicators of vulnerability. There would be benefit in the strategy if there was a clear commitment to establishing something like a permanent panel of public health experts to review the criteria on an on-going basis. Vulnerability is a complex issue that changes a lot over time for society and individuals, and its definition should be reviewed regularly.

On the vulnerability criteria, the strategy assumes 75 as the age at which people require an enhanced heating regime, but that is potentially too high. Vulnerability is not just a health issue. After retirement age, people become more financially vulnerable and spend more time at home, and the same goes for people with children under five. At least until the first stage of work is undertaken to set out the vulnerability criteria, it would be beneficial to include households with children under five and to bring the assumed age for requiring an enhanced heating regime in line with the pension age.

Andy Wightman

Elizabeth Leighton correctly identified that the financial memorandum merely reflects the costs of implementing the bill—for example, the costs of printing a strategy, the time that it takes to write it and so on. You have highlighted other bills such as the Climate Change (Emissions Reduction Targets) (Scotland) Bill that contain more detailed costs for achieving the targets. It would be unreasonable to expect that we can assess the full costs of achieving the target, but what can reasonably be done to assess the broad costs of eradicating fuel poverty either though the bill as it stands or in any amended target that we might have?

Elizabeth Leighton

In our evidence, we suggested that some projections could be made about the costs and gave some examples of research on energy efficiency that has been carried out over the past few years by Consumer Focus—which is now Consumer Futures. Its estimate of the cost of alleviating fuel poverty is an example of how such projections can be made in order to indicate what it would cost to achieve, for example, the energy efficient Scotland accelerated targets for fuel-poor homes.

Those figures indicated that at least double the current annual budget for energy efficiency and fuel poverty programmes has to be made available. I stress that phrase “at least”, because the research looked at only one driver and is a little bit dated. If public health officials were spoken to and front-line workers consulted, it would be possible to project how we could address the other drivers, too. I would not say, therefore, that it would be unreasonable to do a projection—an estimate—of the costs as has been done for the climate change plan and the climate change bill. Importantly, the wider benefits of action on climate change were also looked at, and the same could be done for fuel poverty.

The arguments have been well rehearsed about the benefits for health, wellbeing, jobs, the economy and improved energy security as well as, of course, the energy savings, which go into people’s pockets and get spent in the local economy. Again, there has been research in all those areas, and it could be documented to evidence why investment in this area is well worth our while. You could look again at other Government budgets that could contribute to this effort.

11:15  
Dion Alexander

Some time ago now, the Highlands and Islands housing associations affordable warmth group drew up a proposal for what we called an “energy carer” based model of delivery, which I have described in my previous answers. Although the Scottish Government never formally responded, the proposal was picked up and advocated for by the Scottish Government’s rural fuel poverty task force, so there is work out there that goes into detail on what it would cost to deliver the kind of personalised outreach service that would be required to tackle the problems in the Highlands and Islands.

Andy Wightman

Another matter that we have skipped over is monitoring. The Climate Change Act 2008 established the Committee on Climate Change, which produces reports and is an independent, statutory adviser to Government. Section 6 of this bill says that periodic reports are to be prepared by Scottish ministers and laid before Parliament. I think that, in your evidence, you have all said something about the need for enhanced reporting and scrutiny to help future parliamentarians and policy makers assess whether we are on track; Craig Salter, for example, has talked about reporting on each of the individual drivers. I know that we have your written evidence, but it would be useful to hear any brief comments that you might have about how important you think that might be.

Dion Alexander

Monitoring is very important, and it is also very important that the major reviews are done sooner rather than later; there could be one five years from now, or if you started counting from 2019, there would be major reports in 2024 and 2029. I reiterate that annual interim reports are required in order to keep proper tabs on what is really happening and try to avoid repeating the problem with the previous fuel poverty strategy, when we were always looking back to find that things were not really improving very much and it appeared as though not enough effective action was being taken to alter the direction of travel.

Craig Salter

It would be beneficial if a third-party organisation had the statutory role of monitoring and producing frequent reports on the progress that was being made on each of the four drivers of fuel poverty. I say “each of the four drivers”, but I mean each of the recognised drivers, as they could change over time. That would give a more robust level of scrutiny, similar to that of the Committee on Climate Change.

There would also be a benefit from ministers being required to respond to the reports in Parliament and on each of the drivers of fuel poverty. It is important and beneficial to have a statutory requirement at least to measure and look at each driver to ensure that we do not focus only on one aspect of fuel poverty. Even if it ends up that not every driver can be tackled to the same extent, we need to understand why that is and where the sticking points are.

Norman Kerr

Very briefly, the Home Energy Conservation Act 1995, which came into force in 1996, requires local authorities to report every two years on progress towards their statutory targets. That was to allow scrutiny of progress and, if needed, to allow the target to be amended and guidance to be given on change. A review every five years seems far too long to allow for significant change or for guidance to be given. If we do it every five years, and then take a year to publish, that will run into six years, so the information will already be five years behind. The house condition survey used to be carried out every five years, but now it models every year and becomes statistically valid every three years, although the figures are put out every year. There is a precedent for gathering that information and reporting to Parliament.

Elizabeth Leighton

We have argued that the fuel poverty advisory panel should be established on a statutory basis so that it is independent, goes beyond one Administration, can respond to reports and can provide advice to Parliament. Annual reporting, which would involve shorter reports than five-yearly ones, provides an opportunity to consider whether any corrective action should be taken if progress is not sufficient and whether the approach is adequately resourced. This is not just about the strategy and having nice ideas and plans; it is about considering whether that strategy is adequately resourced to deliver what it says it is going to do. That is what is being done with the child poverty and climate change legislation.

Graham Simpson

I want to go back to the strategy, which is set out in part 3 of the bill. In considering the Planning (Scotland) Bill, the committee agreed to an amendment on enhanced parliamentary scrutiny of the national planning framework. Should that also apply to the fuel poverty strategy? In other words, should the Parliament have a greater role in the strategy so that it is not just left to ministers to publish it, show us it and then move on?

Dion Alexander

To give the briefest of answers, I say yes.

The Convener

I see that there is unanimity. I wish that all the questions had been like that.

Andy Wightman

I have a small final question. The bits at the end of bills, which might seem to be boring, are often the most interesting. Section 13 is on commencement, while section 14 tells us what the act will be called once it is enacted. Section 13 says:

“This section”—

that is, the commencement section—

“and section 14 come into force on the day after Royal Assent.”

In other words, when the Queen signs the bill and it becomes an act, all that we will have is a name and the fact that that name comes into force on that day—and nothing else. We will have to wait for ministers to commence everything else in what will then be an act, including section 3, which some of you have talked about the need to commence. Should we strengthen the commencement provisions so that we have a timetable for doing that rather than just leave it to ministers?

I see that no one has a view. It does not matter.

The Convener

I see that Dion Alexander has a view. You spoiled it, Mr Alexander—it was going so well. [Laughter.]

Dion Alexander

I could not agree more that a timetable is needed. Indeed, the same point was made in many of the responses to the fuel poverty consultation document earlier in the year rather than the submissions to the committee. We need milestones and a much clearer way of understanding what is planned, and we need that sooner rather than later.

Andy Wightman

To be fair, the bill contains the milestones, but the trigger point or the point when the clock starts ticking for virtually the whole bill is in the gift of ministers. Should we set some of those dates in the bill? Perhaps it should say, for example, that some provisions shall be triggered a year after royal assent.

Elizabeth Leighton

You have taken the words out of my mouth. We have suggested 12 months from the date of royal assent, which we think would be reasonable, given that we already have a draft strategy. A 12-month timetable would ensure that the bill did not languish. I do not think that the Scottish Government intends that to happen, but such a timetable would give assurance that the momentum will be maintained.

The Convener

Graham Simpson wants to come in with a final point.

Graham Simpson

It is actually a final question. The bill is an incredibly flimsy document. If we did not have it, would anyone lose out?

Norman Kerr

The simple answer to that is yes, because we would have nothing that said what we want to do. We would have an energy efficiency programme that trundled on to no end, and we would simply continue to provide people with some help without knowing how effective it was. The bill will help to bring that into focus. We on this side of the table all disagree with the 2040 date, but the bill lays out what we intend to achieve. If we do not have that, there will be no focus for future work or programmes.

The Convener

Does anyone have any final comments?

Linda Corbett

I have prepared two case studies of people in fuel poverty, which I will leave with the committee. The first involves a person with whom we worked closely to bring them out of fuel poverty—she was in a local authority property and had plenty of options—while the second is about a lady who has worked very hard to be energy efficient. Although she engaged with two separate programmes—warmer homes Scotland for external wall insulation and, historically, the green deal, although I know that that is reserved to Westminster—she is now, despite that work, in fuel poverty. I have no strategies left to pull her out of it other than give it time and hope for a change of circumstances. The point of including that relates to the 5 per cent target, and the fact that there are some people who just cannot move out of fuel poverty. I will leave those case studies with the committee for members’ perusal.

The Convener

I appreciate that very much—that is very kind of you.

Elizabeth Leighton

On the question whether the bill will make any difference, we certainly welcome it, although we have said that it needs a lot more in it and that it is only half a bill. We have given a starter list of amendments that can be made or areas where the bill can be supplemented so that we can put in place the relevant powers and commitments to allow us to move on from where we are. That would remove barriers and create opportunities to be more ambitious in eradicating fuel poverty across all the drivers. The list is not complete, but it gives examples of where the bill could make a difference if it were amended.

The Convener

On that note, I thank our witnesses for their time and their useful answers. I suspend the meeting briefly to allow the witnesses to leave.

11:27 Meeting suspended.  11:31 On resuming—  
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Second meeting transcript

The Convener (James Dornan)

Good morning, and welcome to the 34th meeting in 2018 of the Local Government and Communities Committee. I remind everyone present to turn off their mobile phones. As meeting papers are provided in digital format, members may use their tablets during the meeting.

Agenda item 1 is evidence taking on the Fuel Poverty (Target, Definition and Strategy) (Scotland) Bill at stage 1. This is our third day of evidence on the bill, and we will hear from two panels of witnesses. We will have one further evidence session on the bill before the end of December, which will be with the Minister for Local Government, Housing and Planning, and we will report to Parliament on the bill early in the new year.

I welcome to the meeting our first panel: Dr Keith Baker, who is a co-founder of the energy poverty research initiative, and Professor Donald Hirsch, who is director of the centre for research in social policy at Loughborough University. I thank you for your submissions. We will go straight to questions from members, starting with Graham Simpson.

Graham Simpson (Central Scotland) (Con)

I have some questions for Dr Baker, but if Professor Hirsch wants to jump in, he should feel free to do so.

Dr Baker, what do you mean by a “folk-first approach” to tackling fuel poverty? What is wrong with the Government’s current approach?

Dr Keith Baker (Glasgow Caledonian University)

I blame my colleague Dr Ron Mould for coming up with that phrase, but it is just a nice, catchy way of saying that until now—and under the current proposals and measures—fuel poverty policies have been driven largely by technical solutions. That includes the use of energy performance certificates, which we argue are, as currently produced, flawed as drivers of tackling fuel poverty. We fundamentally do not believe that the proposals as they stand, with EPCs as a driver, will have anywhere near the desired effect.

In our work, we are reconceptualising fuel poverty to show how the current Scottish definition—that is, the Boardman-based definition—can be reconciled with a wider conceptualisation of vulnerability. That approach was supported by the expert panel workshop on 1 August last year. We feel—we say this as building scientists—that the whole problem should be turned on its head, with human factors such as vulnerability being seen as drivers of fuel poverty and tackled primarily. That might well lead us to recommend technical solutions, but we are suggesting that a much more holistic approach to the way in which we deal with householders be considered.

Does that make sense?

Graham Simpson

I think that it kind of does. It actually leads to my second question, which is about the reference to—in fact, almost a criticism of—the fabric-first approach in your submission. I must admit that I did not quite follow your argument, but I will come on to why that was, if you can respond to my first point and explain what you mean by that phrase.

Dr Baker

At the moment, we use a very limited number of measures—predominantly income and technical performance—to decide what we need to put into houses when we go and see householders. What we are saying and showing is that, although there are groups of householders in fuel poverty for whom the building is the main problem and who can therefore be treated in that way, we have found that, in most cases—particularly in rural and island areas, which I am sure we will come on to—the real drivers are actually human factors such as the vulnerability of householders and their ability to understand the information and to manage their future energy circumstances. It is behavioural and contextual stuff.

We can treat houses—as a building scientist, I have been doing that for decades. I can go into a household and say what technical measures need to be introduced, but the occupants need to be engaged and have to understand what needs to be done. We also need the technical measures to be correct, and I argue that EPCs themselves are not a driver in that respect. In a policy paper that I am bringing out with Common Weal on 18 December, I propose an alternative approach to the development of EPCs, but that is probably a bit tangential to what the committee is considering at the moment.

Graham Simpson

It is not, really. The committee has looked at the issue before, and I would certainly be interested in seeing that paper.

Dr Baker

The key driver in it is the modelled data that we use. This relates to the fuel poverty problem and the energy efficiency problem. At the moment, almost all policy making relies on using modelled data from, for example, the home energy efficiency database, which we argue is incredibly poor and is probably detrimental to solving the fuel poverty problem. We have accessed and used real and accurate household data—technical, household composition and household characteristics data—from local authorities, housing associations and other such trusted intermediaries that have the authority to process that data, to show that the rural energy spend and the urban-rural energy spend gap is significantly greater. When we normalise all the other variables and underlying factors, it is clear that it is the human, social, behavioural and environmental problems that are driving that big gap rather than the technical issues.

Graham Simpson

What if we treat someone’s house and make it as energy efficient as possible? Let us say that the ultimate goal is the passive house standard. Surely if something is built to that standard, we could almost eliminate fuel poverty. Would you disagree with that?

Dr Baker

It depends on what we measure and how we measure it. At the moment, if we improve a dwelling, the improvements will be directed by what comes out of an energy performance certificate, or a standard assessment procedure. There are huge volumes of evidence going back several decades that show that the accuracy of EPCs for selecting and driving those improvements is not good—they are hugely inaccurate. There are studies that say that SAP and EPCs are unfit for that purpose.

It is great to install technical measures, but it is important to ensure that they are installed on a proper technical basis, which we are currently not doing. Another issue is that among vulnerable lower-income householders, those measures will not deliver the savings that we expect, because we do not have the correct baseline for those householders. We are not dealing with things such as self-limiters, or people who switch their heating off. The Office of Gas and Electricity Markets has admitted that it does not have that data, so we do not know what numbers are out there.

Graham Simpson

Let me put it in layman’s terms. If we make a house as energy efficient as possible and it is really well insulated and airtight, there is no need to put the heating on. If we build a new house to the passive house standard, we do not actually need radiators, so that would slash fuel bills. If we slash fuel bills, we cut fuel poverty.

Dr Baker

As a building scientist, I would not say that the passive house standard is the only route to go down. The passive house standard has its uses in Scotland—in certain areas and certain places—but there is also the natural design approach. That is the school of building science that I am from, and that approach is maybe more appropriate in Scotland. That is a matter for building standards, and building standards have improved.

However, we are not necessarily going to take that approach because of the other factors that are involved. That is our view, as building scientists, having looked at the evidence. We do not want to stand around and say, “Please don’t give money to our field and don’t support what we do,” but we are saying that the interventions that have been done are largely not as successful, particularly among poorer and more vulnerable householders, as the modelled data would suggest. When we go and look at those households in real life and get measured data, we do not get the savings that we would expect. That is partly due to things such as the rebound effect and the prebound effect in relation to how householders use energy.

If a nice middle-class household gets insulation installed, it will get close to the expected savings. However, once we go beyond that standard household archetype, the uncertainty and variation become highly significant, so we cannot make assumptions about savings.

The other point to mention is on the way in which householders change behaviour before and after intervention. We make the assumption that, just because we put energy efficiency measures into a household, people will necessarily start to behave in ways that make the household more resilient to fuel poverty. However, that is based on an assumption rather than any evidence.

Graham Simpson

You are using a lot of jargon.

Dr Baker

Sorry.

Graham Simpson

I am not very clear whether you are in favour of taking energy efficiency measures or not. Not one member of the committee would deny that people have to be educated on how to use systems in their homes, but do you not agree that we have to make the home as energy efficient as we possibly can?

Dr Baker

Yes—we have to make the home efficient and educate people. We are in favour of energy efficiency measures, but we do not believe, and our analysis supports this view, that the energy efficiency proposals under the bill—using EPCs as a driver and bringing all households up to band C or D—will have the projected and desired effect on reducing fuel poverty levels because of the uncertainty about how those measures are likely to affect household energy consumption and spend, particularly by poorer and more vulnerable householders and those in the Highlands and Islands.

It is a simple case of the data becoming a lot more uncertain. A nice middle-class household living in the centre of Edinburgh that starts to insulate can probably achieve the savings and benefits that the models suggest. However, once we get away from a standard household—an archetype—the inaccuracy becomes significant.

The approach will work, and we can and should be driving energy efficiency in households in which it will have those effects. However, for the majority of fuel-poor householders, it is clear that the real problems are their incomes and their ability to manage their lifestyles and understand their energy bills.

We have a paper coming out next year about a study in Renfrewshire, which shows that more than two thirds of more than 7,000 interventions that were carried out by the local authority and the housing association largely involved showing poor and vulnerable householders how to use their central heating systems.

It is great that we are making technical improvements—assuming that we are getting them right; that is another question—but we have shown that we will get much more benefit for those who are most in need by tackling the whole house. That is also supported by the work of Christine Liddell, who was on the review panel.

Households might need insulation, as well, but what they really need is somebody to show them how to use their boiler and other simple energy-saving measures. Perhaps we can give them an energy meter and say that they should try using the kettle to boil just one cup of water or whatever for a couple of weeks and appreciate how much that saves on their energy bills.

If those householders are told that they can save £10 on their energy bill this week or £100 in the future, they will take the £10 now—we know that from basic human psychology. It is about building in that resilience. Technical solutions will certainly reduce energy use and put that buffer zone in, but they will not necessarily develop that resilience in households. That human approach is needed.

Kenneth Gibson (Cunninghame North) (SNP)

You mentioned the rebound effect. You are suggesting that, when a poor household has their house insulated, they may feel that they can put the heating on, whereas they maybe did not put it on quite as much previously. Is that what you mean?

Dr Baker

Yes. The rebound effect will occur in other ways, as well. The classic middle-class example is the person who saves money on their energy bills and then takes an extra flight. However, we do not know what a poor or vulnerable householder will do. We could be dealing with someone who has not had their heating on significantly for years. Will they choose to adopt a very high heating-energy regime? They could be up to their eyes in debt. A classic example of what we deal with is somebody who is so far in debt that, when they get heating improvements, they decide to have their house at 26°C because that feels comfortable, and they will service the debt whenever.

Kenneth Gibson

I do not know many people who would want their house at 26°C. We have taken a lot of evidence that says that, if a house is much warmer, it reduces respiratory and other illnesses, for example. If people feel able to keep their house warmer, even if the energy consumption does not decline, it is much more efficiently and effectively used, and the person is warmer and feels healthier. Surely that is a benefit in itself.

I understand what you are saying about behavioural changes, but we have very mobile households now, particularly in the private rented sector. If houses are insulated, bills will still be lower. People have to move around. If someone moves into a house, does that mean that someone should go in and explain all the implications that you explain to people?

Dr Baker

Yes.

Kenneth Gibson

Surely technical measures are core to that.

Dr Baker

They are, but you have to recognise that there are different types of technical measures. Boiler replacement is among the most common, and that will need somebody to go in for some of the householders whom we are talking about. Organisations such as Govanhill Housing Association will do that. Govanhill Housing Association works with the charity South Seeds. It covers a lot of people from the Romanian community. It will go in, set people up, and show them how to use their heating systems from the start. A lot of housing associations will do that. However, as you have said, that will largely not capture the private rented sector. It will capture housing associations, but we know that the energy performance of housing association properties is generally higher than that of the rest of the housing stock anyway. It will not capture owner-occupiers unless they seek that help.

I am just trying to remember where you were going with the other part of the question.

10:00  
Kenneth Gibson

Let us move on to something else. You say that the new targets represent a significant step backwards. You say that the Scottish Government’s ambition of reducing the number of households in fuel poverty from 600,000 to 140,000 by 2040 is a backward step. Why is it a backward step?

I would also like to hear from Professor Hirsch, because he has been very quiet so far.

Dr Baker

The original target was to eliminate fuel poverty as far as practicable by November 2016. We would accept that, within that, probably 3 per cent of households that were captured by that definition were fuel poor, based on the problem with the definition. The large, rich household can be classed as fuel poor because it has a large area to heat and a relatively low income; the little old lady in the castle in the Highlands would be a very stereotypical example.

We have gone from the question of eliminating fuel poverty under the current definition by 2016 to a question of using energy efficiency as the main driver for reducing fuel poverty significantly by 2032. If you are adding 16 or more years to where we were, that is effectively a reset.

Kenneth Gibson

When the Lib-Lab Executive set the target, I do not think that it realised that fuel prices were going to go up by 155 per cent while incomes would go up by 38 per cent over the piece. Clearly, that has had a serious impact.

The committee has often discussed how we do not have control of energy prices or, indeed, income levers. Given that, do you not think that it is pretty ambitious of the Scottish Government, working under those constraints, to still be determined to reduce the number of people who are in fuel poverty?

Dr Baker

Given the timescale for the implementation of the proposals—2032 to 2040—there is absolutely no guarantee that that will not happen again, or happen again more than once.

Kenneth Gibson

We do not think that there is such a guarantee. However, there is a determination and all political parties are committed to it, but external shocks can sometimes derail things. We cannot insulate the country from such things, certainly not with the devolved powers that we have.

Dr Baker

No, but the latest Scottish house condition survey’s initial key findings from 2017 show that there has already been a substantial rise. The increase in fuel poverty is being seen largely among households using electricity, households using liquefied petroleum gas, and households using oil. We have therefore seen a statistically significant increase during the past year.

Obviously, we have not had a big oil spike or a big gas spike, but that sort of thing could be on the cards because it has happened before.

Professor Donald Hirsch (Loughborough University)

I have not looked in the round at whether the target is more or less ambitious. Having looked at some of the committee’s deliberations and what witnesses have been saying, I would say that a key issue is whether you accept that a significant level of fuel poverty will remain over the long term and whether that creates a disincentive to deal with certain aspects of the problem.

A lot of the debate has been about the remote rural issue. On a purely numbers-based or target-based perspective, the risk is that there is no incentive to make progress in sparsely populated areas where interventions do not have the same economies of scale as they would have if you were refitting an urban terrace—

Kenneth Gibson

May I just interrupt you there?

Professor Hirsch

That would be the particular thing that you would want to be careful about.

Kenneth Gibson

I am sure that we will go on to talk about that. I wanted to hear your opinion on the matters that we have discussed so far.

The committee is going to Stornoway tomorrow. I am sure that all committee members are keen to ensure that rural areas are not left out, that it is not just a numbers game and that every community in Scotland has the opportunity to address fuel poverty. We will impress that upon the Scottish Government. We have to discuss the mechanisms of that, but we are taking evidence on the issue tomorrow and Friday.

Professor Hirsch

I accept that.

Kenneth Gibson

What is your response to the issues that we have discussed so far?

Professor Hirsch

The earlier question was a technical one that is not within my area of expertise.

Annabelle Ewing (Cowdenbeath) (SNP)

Good morning, gentlemen. I will pick up on some of Dr Baker's comments, because I remain a bit confused. If you do not think that the Scottish Government should proceed with, in your words, a fabric-first approach, where would you rank the need to tackle fabric issues? From my perspective as the MSP for the Cowdenbeath constituency, everything else is theoretical for constituents who live in damp houses; they want that problem solved first and foremost as they do not want to live in damp houses. I am not clear about what you are saying or how it would help my constituents in the short term.

Dr Baker

There are two issues here: the practical issue of how to identify and tackle matters in the field, and the issue of the data that we use. We recommend improvements based on modelled data, but I should warn you that anyone who says that modelled data is good probably has a vested interest in producing it. We can direct improvements, as the academic panel recommended, by making more and better use of real data that is available. That in itself would drive better technical solutions. We certainly see technical solutions as part of the process, but we have to get data on householders and use the time to get better technical data as well, so that we can assess what improvements are most suitable for the individual.

I have just done a bit of work on householders who are in fuel poverty and who have dementia, for example. Someone might not want to put in their gold standard measures for that sort of householder, because they might not have the capacity to use them optimally. It is therefore about appropriate solutions as well.

We recommend improvements based on modelled data and project savings from modelled interventions, but they will not necessarily deliver the benefits that the models would show. In some cases, they might be higher, but we need to be as accurate as possible. If we tell somebody that, by putting in whatever intervention, they will save X amount of money and then they do not, that will have a negative effect. At the same time, if we tell them that they will get Y amount of savings and they end up with more, they will be less incentivised to adopt further behavioural measures. The paper that we have coming out expands on that.

If we are going to recommend technical interventions, they have to be right and the benefits that we say each household will accrue have to be predicted reasonably accurately; otherwise, there will be negative consequences one way or the other. We can improve how we do that by putting the householders first and saying, for example, that they might need help with their bills or they might need an energy meter in the house to monitor their energy consumption over the next couple of months; that would give us a much better idea of the technical measures, the social measures and, possibly, the income support measures that that household will need so that we can treat them as a whole. We start with the people, but we do not exclude those technical solutions. However, by putting the people first, we end up with better technical solutions and cost effectiveness.

Annabelle Ewing

I remain a bit confused. Someone who is living in a damp house wants that problem to be solved in the short term. Everything else—such as work on behaviour or managing household income—would flow from that, notwithstanding the fact that we do not control the key levers in that regard, as Kenny Gibson said.

I am a very practical person and would not want to live in a damp house, so I do not find it acceptable to see anybody else living in a damp house. Dampness is a technical issue that can be sorted, then things can come in off the back of that. The other issues do not exclude tackling at source the first, fundamental problem. With respect, I am not convinced by what you have said. I agree that we should use the most relevant, appropriate and up-to-date data, but if a housing officer in Fife goes into a house and sees dampness, that needs to be sorted.

Dr Baker

But even with technical solutions, thinking that the dampness is the only problem that needs to be solved—and limiting the treatment to that—might cause other problems.

I will give you a classic example from a study that we did a few years ago of a household containing a single-parent woman in a flat in Glasgow. The flat had a damp problem but also an insulation problem. Her child had asthma and she was told by the local authority that she needed to keep her windows closed to save on energy bills, and that extra insulation or whatever would be put in when the local authority got round to it. At the same time, however, her general practitioner was saying that if her kid had asthma, she needed to keep the windows open. That high-rise flat could be insulated, but that would not happen overnight; it could take months if not a year or two, depending on contracts. However, as you said, you want to get that person the best solutions first. There may therefore be other ways in which that person could be supported as part of a more holistic intervention.

We have to be careful not to create other technical or social problems in tackling a damp or high-energy problem; we have to put in the right solutions.

Annabelle Ewing

I think that everyone would wish to see the right solutions. With respect, the issues that you talked about are not mutually exclusive. It is a question of working out the first problem to be tackled and taking things from there. If a home is damp, to me, that would require treating the dampness issue first; management and holistic approaches and so forth would follow thereafter. I am afraid, therefore, that I beg to disagree.

The Convener

Thank you for making your position clear, Annabelle. I will come in at this point, then I will take questions from Andy Wightman and Alex Rowley.

You talked about a holistic approach, Dr Baker, but surely the bill is already facing up to that in saying that education has to be a key component. I am sure that what you say makes sense theoretically and without the theory we do not get the practice—everybody has to agree with that. However, surely the way that you seem to be undermining the fabric-first approach with your folk-first approach—I accept that that was not your name for it—does not help. Others have already said that and my colleague, Alex Rowley, last week gave the example of a woman who got the interventions and went from spending 25 per cent of her income on bills to 5 per cent, which also helped her child with his chest problems and stopped him being admitted to hospital.

Although I accept your point that some things cause another and that people have a responsibility to make sure that knock-on effects are dealt with, surely the first priority has to be that, if a house is in bad physical condition and a family is staying in it and suffering, you go in there and intervene. Members of the committee who were in Dundee and other places have seen examples of that and how, on the back of that, other services would be in there, too. Surely that is the right way forward.

Dr Baker

First, I stress that I am not an academic sat in an ivory tower.

The Convener

That is not what I am suggesting at all.

Dr Baker

I am not saying that you are, but a lot of the work that we do is with housing associations, community groups and local authorities in people’s homes. I do not just sit out here and collect the data; I work with people who go into people’s homes.

I will take a step back from what you first said and use the example of a community project. The first thing that you can do is get somebody into a person’s household straight away—that could be at odd hours—and give them the reassurance that their problem will be solved. One problem that we have at the moment is the relative lack of support for and investment in face-to-face and in-home delivery. It might be that someone walks into somebody’s household late at night or early in the morning and a problem is dealt with straight away——I could probably find an example of that.

Giving that bit of reassurance that help is on its way might lead to some early technical interventions, but the whole household can also be looked at while they are there and, if more intervention is needed down the line, a plan can be set out and the person can be engaged from the moment that that first contact is made. They can say, “I’m going to do this for you now, but I’ll come back in a couple of days, or you can come into our office, and we will sort out your energy bills and maybe look at a longer-term plan to replace your glazing or make more significant improvements.” A key issue is that we do not pass people from pillar to post and refer them from one service to another all the time, because they will drop out.

The Convener

I do not think that there is a person here who would disagree with that; it is eminently sensible. However, the very early outcome of that has to be that the problem in the house is dealt with. We must deal with whatever the practical issue is—making the house warmer or dealing with the damp—and all the other things will flow from that first meeting.

There are already people doing that, and I accept that there may have to be an enlargement of that field, but I do not think that it is helpful almost to denigrate the fabric-first approach, when there is no doubt that we cannot improve people’s living standards without, in many cases, improving the fabric of their houses.

10:15  
Dr Baker

That is fine if the fabric interventions that are delivered end up delivering the savings that the models say that they will, and which the person is told that they will.

To throw the question back at you, if you are treating mould, what do you do? Do you go in, as I have just done with a flat, and spray a bit of mould spray around, which kills the mould temporarily? Or is the solution not just spraying the mould, but telling the person that their walls need to be stripped back? That cannot be done overnight. You might be dealing with a mould problem and you might think that a mould problem is quick and easy to solve, but—

The Convener

I will use a politician’s answer. This session is not about questions to me; we are here to ask you questions. However, I will answer. We have already said that the whole situation has to be dealt with in the round, but we must deal with the problem that is causing the child’s asthma or whatever the case may be. We must look and see if there is a knock-on effect that will still cause the child problems. That has to be dealt with.

I will let Kenny Gibson in briefly.

Kenneth Gibson

In work done in partnership with the Energy Agency, NHS Ayrshire and Arran has shown that

“in areas where wall insulation has been installed there is a reduction in hospital admissions and GP visits.”

The committee has discussed the submission that the Energy Agency made. Does Dr Baker not agree with that?

Dr Baker

Absolutely.

Kenneth Gibson

That is with all else being equal, regardless of the other issues that we have talked about. The submission suggested that that measure alone has had an impact in reducing the number of hospital admissions and GP visits. Therefore, fabric first works—not entirely, but to an extent.

Dr Baker

It will lead to a reduction, but in most cases it will not lead to a change in the end point of that person’s health condition. I was one of the authors of the built environment report that supported the Scottish Government’s climate change plan—RPP3. The report said that there would be a reduction in GP appointments, but that, in most cases, a fabric-first intervention pushes back the trigger point when somebody will seek help from their GP. The classic situation is that an elderly person goes from their nice, warm living room to the bathroom, has a heart palpitation, then goes to see their GP. If their whole house is insulated, the point at which they consult their GP will be pushed back. That could mean that they make several fewer visits and there would be savings as a result. We have not yet done the maths on what those savings are to the national health service; that needs to be done. That is one of the things that supports our argument. If we could get proper data on those figures and savings, we could use that as a justification for more in-home advice and support. That would drive technical solutions, but it would also put householders first.

Andy Wightman (Lothian) (Green)

I will direct some questions at Professor Hirsch. The bill that we are scrutinising sets a target and gives a definition, and it makes provision for a fuel poverty strategy and some reporting. Dr Baker, early on in your evidence, you talked about the inadequacies of the EPC ratings. The bill does not make any provision on that. To be clear, the references that you made were just about delivery, which will be dealt with through the strategy and all the rest of it.

The definition of fuel poverty is now more complex. The first thing that I want to clarify is that the definition is used along with the Scottish household survey and other statistics to come up with a national figure of the proportion of the population that is living in fuel poverty. We had the latest data yesterday.

To what extent could the definition be used when designing delivery programmes? As I understand the bill, the purpose of the definition is to provide headline statistics for the country. Would you agree that how Glasgow City Council, Argyll and Bute Council or any other authority goes about reducing fuel poverty—and deciding where to target its approach—is a separate question?

Dr Baker

Yes, I would.

Professor Hirsch

In itself, the definition could not be used in that way, because it is a heterogeneous problem: there are different drivers in different areas. The way in which the definition is designed and the incentives that that produces could influence the emphasis that is put on different interventions. For that reason, how you phrase your definition matters.

Andy Wightman

Dr Hirsch, you are critical of modelled data. What is the fundamental problem with that? Is it a problem regarding getting an accurate assessment of the proportion of people who live in fuel poverty, or is it a problem in relation to ensuring that the programmes that are designed to reduce fuel poverty are well designed?

Professor Hirsch

I am not quite sure what you meant when you said that I am “critical of modelled data.”

Andy Wightman

I am sorry—I meant Dr Baker.

Dr Baker

The simple answer is both. It has become quite clear—particularly from our work, but also from the Scottish house condition survey stats—that there is a question about whether we need a remote rural adjustment in the definition. Is the condition of fuel poverty in rural areas and, in particular, remote rural areas significantly different from its condition in urban areas? It is very clear that the answer to that is yes. What we do about that is up to the committee and those working on the bill, but we—I think that Donald Hirsch would agree—have argued for a need for a rural adjustment, and the new SHCS stats show that the increase in fuel poverty over the past year has been proportionally higher in rural areas.

With regard to delivering the measures, we currently recommend measures for households based on a model, an assessment procedure and EPCs that, in many cases, particularly for traditional or remote rural properties in Scotland, are inaccurate. The further the deviation from a standard new-build two-bedroom or three-bedroom semi, the more inaccurate the predictions or model results become. Sometimes, there will be higher than expected savings and, sometimes, the savings will be significantly lower than expected, potentially with orders of magnitude of difference. Much greater accuracy is needed in order not to have negative consequences, so that you can drive better energy efficiency behaviours and, at the same time, know that if you say that people are going to get X amount of savings, the savings will be delivered.

Andy Wightman

Professor Hirsch, thank you for your evidence on the minimum income standard, which was short and concise. You are currently responsible for producing a minimum income standard for the whole of the United Kingdom, with a London weighting. Geographically, that is all that you do, which is a big job. Do you just produce two measures or are there any others?

Professor Hirsch

First, I should declare an interest, as this debate will be about whether there should be a remote rural measure—

Andy Wightman

We will come on to that in a minute.

Professor Hirsch

I should just say at the outset that, in so far as that measure comes into it, we might have an interest, as we might be asked to calculate part of it.

We now regularly do the UK version, which, as the bill is drafted, is the version from which the Scottish Government would regularly take data. It would not require any extra work from us, although we have been in touch with the Scottish Government about how that data would be mined. We regularly do a London version, and in 2013, we did a remote rural Scotland version of it, which had some updating in 2016.

The calculations in the independent review panel’s proposed measure used a crude estimate that was based on the work that we have already done on remote rural Scotland. The panel used that to come up with its estimates of what the results would be if you had that element. The method is there, the work has been done and it could be regularly updated. The issue about whether any extra research would be required is about whether one updates something that has already been done in those areas.

Andy Wightman

That is helpful. Why did you do the remote rural Scotland version in 2013? Was that for the fuel poverty definition review panel? No, it did not exist then.

Professor Hirsch

No. Highlands and Island Enterprise, in partnership with quite a number of organisations, including local authorities in the area and other groups, such as the rural and islands housing association forum, funded us to do a study, not solely because of the fuel situation, but because of the perception that there are a range of additional costs in remote rural Scotland.

Andy Wightman

That was helpful.

In your submission, you say that you can see

“no conclusive argument against taking up the expert panel’s recommendation”

to produce a remote rural variation. The minister has told us that that is not necessary and would be quite expensive.

Professor Hirsch

I saw the note that the Government provided and I have talked to the Government. As to whether it would be quite expensive to produce a remote rural variation, I can only tell the committee what it would cost us to do. It would involve making sure—not every year, but on a regular cycle—that the estimate of additional, non-fuel costs in the areas concerned kept in touch with reality and that, when a premium was applied to the UK MIS, that was adjusted whenever the UK MIS changed, because the starting point would be different. There are light-touch ways of doing that—it could be done in more or less detail, depending on how many areas were looked at. Some additional qualitative research of the kind that we did, which involved talking to people in those areas about the extra costs, would be required, as well as some regular, fairly routine updating of prices.

My broad estimate is that, if we were to do it, it would cost between £50,000 and £100,000 a year. I do not know why the Government has said that it would cost £0.5 million over four years rather than five—in our view, that would be a maximum. Is that a lot of money? I read that the Government spends around £100 million addressing fuel poverty, and £50,000 to £100,000 is not very much in comparison with that. I reckon that the Government spends about £2 million on the Scottish house condition survey. If you want to make sure that you target things properly, you need to spend a small amount on gathering knowledge. I do not believe that the amount involved would be large.

The other suggestion is that a remote rural variation would not make much difference. The independent review panel estimated that in remote rural Scotland, according to its measure, which included the adjustment that we are discussing, the fuel poverty rate would be 40 per cent. The Scottish Government’s technical annex estimates the fuel poverty rate in those areas as being 28 per cent. I do not think that that is a negligible difference.

There are all sorts of technicalities to do with how those measures are compared, but the underlying point is that if, as our evidence suggested, it can cost 25 to 40 per cent more to live in such an area, why would having a threshold that was that much higher not make a difference to the number of people who we say are in fuel poverty? A large percentage of the population would be in the band between those two thresholds, so I am a bit confused by the notion that having a higher threshold would not make a difference. It is true that there are some people who are on pretty decent incomes who spend more than 10 per cent of their income on fuel, and I strongly agree that those people should not be considered to be in fuel poverty. Just because someone spends a certain percentage of their income on fuel, that does not mean that they do not have enough left to cover their expenses.

The important thing to consider, which is why I think that there is a case for a remote rural variation, is that in the areas where fuel costs are high, so are other costs. In the past, it has been said that fuel poverty is a problem because people spend a lot on fuel. In asking how much people have left after their expenditure on fuel and whether that is adequate, it is extremely important to take into account those additional costs, because that is part of what is making things difficult for those households.

We have done work in different areas. We did a project in rural England, and we found that there were some differences in costs, but they were quite small. People can still get to the main supermarkets, they do not have to travel vast distances to get to work and they do not need to pay for extra delivery charges. That is not always the case in remote and rural Scotland. From the research that we have done, Scotland is unique in the UK in producing those extra costs. London produces extra costs, but a lot of them relate to housing, and the measure takes account of that. However, in Scotland there are extra costs across the board. We found that Scotland was the only part of the UK that was really different from our main urban model.

10:30  
Andy Wightman

That is helpful. Is there a case for having a Scottish MIS, or is the distinction between Scotland and England much less important than the remote point?

Professor Hirsch

That issue has come up. For that reason, in our routine work this year, we made sure that we did some of our research in Scotland as well as in England, in order to see whether our hypothesis, which was based partly on earlier work, was valid. We thought that most parts of the UK, particularly urban parts, were pretty much the same in terms of how people define minimum costs. We looked at pricing at national chain stores and so on, which would be accessible to somebody in Falkirk but not to somebody in Stornoway. When we did that research, it was striking that we found that there was pretty close to zero difference.

On the living wage, which is also based on our research, I am aware that there is a standard that people have been applying across the UK. It would be very confusing to start dividing that up. Of course, the living wage is used a lot in Scotland. If we felt that we had not looked at the issues in Scotland or that the situation in Scotland was very different because people do things differently and have different ideas about living standards, it would be really important not to just have some kind of English version. However, as I said, we have now done work across the UK that suggests that that is not the case.

Andy Wightman

As I understand it, the data that we have on rates of fuel poverty is gathered nationwide through the Scottish household survey and other statistics, and it is then broken down by local authority and published. On the assumption that we were to agree that we need a remote rural variation—I know that we are still to take a view on that—would it be better to present the statistics based on the six-fold urban rural classification than those based on the administrative boundaries of local authorities?

Professor Hirsch

It would be good to do both. Particularly if you are trying to develop strategies, using the six-fold classification is really helpful, because it talks about area types, which are likely to have some commonalities in terms of approaches. A lot of local authorities are mainly within one of the six-fold classification categories.

I want to raise an issue that has come to my attention since I wrote my submission, having reflected on some of the things that have been said. The six-fold classification has two categories that we think, from our research, have significantly higher costs. One category—category 6—is called remote rural, which is remote and rural settlements with a population of fewer than 3,000 people and which are more than half an hour’s drive from a larger town. The other is category 4—remote small towns—which is settlements of between 3,000 and 10,000 people and which are also at least half an hour’s drive from a larger place.

In fact, what we called remote rural Scotland included towns such as Thurso, Stornoway and Lerwick. I suspect that the review panel’s initial calculations looked only at category 6, but I would submit that there is just as much of a case for including category 4. It is all part of the same work, and we have made the calculations in that respect. Whether a person lives in Thurso or in a village outside it, most of the same costs apply, because those who live in the town still have to travel quite far to get to work or have no access to a supermarket and therefore have to pay higher prices. Indeed, in the case of the islands, for someone who lives in, say, Lerwick, there are large delivery charges and a lot of goods cost more.

I mention that caveat, because if the legislation were to be amended to include the term “remote rural”, it could be interpreted literally as covering only category 6, which has that label. As for what would be advisable and logical in that respect, I think that the legislation should cover both category 4, which is remote small towns, and category 6, which is remote rural areas.

Andy Wightman

Thank you. That was extremely helpful.

I will conclude with a couple of brief questions. Dr Baker, you mention in your submission an expert workshop held in Glasgow in August 2017, at which there was consensus with regard to postponing the new definition for two or three years. Is there a written record of that workshop that you can provide?

Dr Baker

I do not have a written record, but it was organised by, I think, the communities analytical services division of the Scottish Government, and I would expect it to have such a record. The expert panel had a presentation, and the workshop itself was made up largely of academics. One of the stakeholder organisations was represented by someone from its delivery body, but they contributed very little.

The consensus in that room was overwhelming. Even the chair of the panel of civil servants said, “I am amazed that I’ve got you lot in this room, and you’re all agreeing with what the panel’s saying.” I totally endorse the findings of the panel’s report, which was excellent; I just wish that the Scottish Government had taken more cognisance of it.

I know that Professor Donald Hirsch cannot comment on the value of his work, because he might be contracting for it, but as far as I am concerned, if it is a question of giving him £100,000 a year to do some work on rural areas—and we have already accepted that we do not have any evaluation of the savings that can be made from general practitioner visits and so on in those areas—and if that cost-benefit analysis comes out in favour of savings to the economy, it is an easy win. If £100,000 of work a year saves £200,000 across the Highlands and Islands, I say, “Give the man his money.”

Andy Wightman

That was a helpful endorsement.

The Convener

I hope that you do not think that your job is to act as Professor Hirsch’s agent. [Laughter.]

Dr Baker

I am not taking any money out of this.

Andy Wightman

Finally, Dr Baker, you say in your submission that you

“have consistently criticised the Scottish Government for involving delivery bodies in the design of energy efficiency and fuel poverty schemes”.

Again, that is strictly outwith the bill’s remit; it says nothing about who should do that. We will come on to questions about the strategy, scrutiny, monitoring and so on, but can you tell us briefly why you think that that is a bad idea and whether, to date, it has had adverse consequences?

Dr Baker

I should say first of all that I was the lead author of the review of the Scottish Government’s energy assistance package. That report was heavily debated—shall we say?—and I argue that some of its more controversial findings were redacted, although they have been revisited in later work.

At the moment, there are organisations such as Energy Saving Trust and Warmworks Scotland, which is a collaboration between the trust, Changeworks and Everwarm. The trust delivers home energy Scotland, the national home energy helpline and online service, which does its job in improving energy efficiency in certain groups of households—although we argue that that is rather small—and it also manages and delivers the home energy efficiency database, which contains modelled data. We should not forget that although EST and Changeworks are not-for-profit organisations, they are still a step away from being public bodies. Having worked for a not-for-profit company before, I know that a company being not for profit does not mean that it is not trying to increase its internal financial capital to sustain itself in the long term.

Obviously, any organisation that delivers a service is going to lobby for more money—

Andy Wightman

You were making a general point that there are vested interests at stake and that we have to be alert to them.

Dr Baker

Absolutely.

Andy Wightman

That is fine—there is no difference on that. Have there been any adverse consequences of paying heed too closely to the advice of such bodies?

Dr Baker

Yes. There are two main adverse consequences. First, we have technical solutions, and the policy around that is driven by model data. I do not have a vested interest in promoting real data—it does not cost me anything. I may or may not be contracting in the future, but the work that we have already done has been totally independent. It costs money to develop and maintain a model. It also costs money to develop and maintain databases of real data, but that is largely done by local authorities and housing associations as part of their work anyway.

Secondly, there is significant investment in home energy Scotland, which amounts to about two thirds of the overall budget. We are not saying that home energy Scotland should go away—it delivers a service and useful advice to those who can access information by phone and online. However, that is not a large number of the fuel-poor householders. We are about to publish a new paper that shows exactly that point. There are barriers: people do not like talking over the phone and they have difficulty understanding complex problems over the phone. In many cases, all that is needed is for someone to show people how to use their heating system properly and that cannot be done over the phone. So why is there a significant bias in funding towards a body that does it over the phone and online?

I should note that the EST and Changeworks carry out home visits, but the vast majority of the work is done by local authorities, housing associations and charities. The way in which we tackle fuel poverty on the ground is very much in line with what we have been saying. When I have been presenting our work, people have come up to me and said, “That is what we do in practice.” That may be so, but that is not what policy is driving.

Kenneth Gibson

I want to ask about the urban and rural classifications. Do you think that they need to be more flexible? You talked about Lerwick, Stornoway and Thurso, for example. I represent two major island communities of about 6,000 people in total. Do you think that all Scotland’s islands need to be included in any MIS remote rural classification?

Professor Hirsch

That is a very important question and one that I have been reflecting on. The original work tried to give a qualitative description of different areas of Scotland. It was very important to say, for example, that someone on the Mainland of Shetland does not face such high costs as someone who lives on another island and who has to take a ferry to work. There are a lot of subtleties like that. We specified four main area types and then 10 other kinds. That complexity makes such research potentially quite expensive, although not in the order of the money that is being spent on the problem.

If our main objective is to measure fuel poverty in general terms and to see whether it is higher in certain regions of Scotland, it becomes less important for every case to be accurately measured against the exact area that it is in. Indeed, the review panel took an average and applied that. When we are considering numbers in remote rural Scotland, they will get smaller and smaller the more remote you get, because there are fewer people living there. It is very important to make those distinctions if we want to understand and address the problems of particular areas, but we do not need that fine-grained detail if we are just trying to see which way things are going and discover the overall number of people in remote rural Scotland who are in fuel poverty.

There is an issue about islands and particularly whether to include the nearer islands, which one would have to consider. There is a starting point, which is the figures that we produced in 2013 and the percentage extra that it costs to live in certain areas. It is wrong to argue that one could not make a calculation right away, because that could be the starting point. However, to update and refine it there would have to be a one-off exercise to examine which specific areas would count, because one would need to know whether to count every person in the survey. The simple way to do that would be by using the sixfold classifications. That might be a good enough. However, there are arguments for including, excluding or adapting certain areas, too.

Kenneth Gibson

Yes. On the mainland, you can argue till the cows come home about what is remote, how big a remote settlement is and what is rural—there are classifications for that already—but an island is an island. Less than 2 per cent of Scotland’s population live on islands and incomes there generally tend to be lower and costs tend to be higher. If we go down the road of a minimum income standard for remote and rural areas, I would have thought that all Scotland’s islands would be included, unless you go to the nth degree in examining every single island to determine which islands have higher—

10:45  
Professor Hirsch

I think that I am right in saying that they would all be in category 4 or 6, because they are all at least half an hour away from towns of more than 10,000 people. They would be covered in that classification.

Kenneth Gibson

Good. There will clearly be more difference between any island in Scotland and the mainland than between Glasgow and Liverpool or Bristol.

Professor Hirsch

In that respect, the initial estimate was crude. It was a starting point that just took an average for the whole of remote and rural areas and set a percentage uplift. You would want to be more nuanced than that. You would want to have at least one category for islands, one for the Highlands and maybe one for remote southern Scotland. Those could be the three main categories. I very much agree with you that islands are different in type for many reasons such as costs.

Dr Baker

I agree. Given the changes that climate change could bring about over the next 20 to 40 years, let us be aware that a very rural settlement could become isolated because of rises in sea level. I am thinking in particular of Dumfries and Galloway and the south-west coast.

On the question of what is an island, as part of our work we reclassified Skye as a rural area because there is a bridge there. The work that we were doing was looking at fuel coming over the bridge—biomass. You have to be careful about what is within the bounds of what it is reasonable to do with policy at the moment. However, I broadly agree with everything that Donald Hirsch said.

Kenneth Gibson

You are right to hit on Galloway, because people sometimes forget that there are places in Ayrshire, Galloway and the Borders that are remote and rural, too—remote and rural areas are not just in the Highlands and Islands.

Alexander Stewart (Mid Scotland and Fife) (Con)

Good morning, gentlemen. I want to ask about how energy performance certificates have featured. They have been quite prominent in the draft fuel poverty strategy and in the “Energy Efficient Scotland” route map. The Scottish Government believes in the certificates and has given them validity because it sees them as an opportunity to measure and provide efficiency within homes. Dr Baker, you have been quite critical of that process. Will you expand on how you see it?

Dr Baker

I will give you a bit of technical policy background. EPCs have been required by the European Union since August 2007. How they are produced is covered under the energy performance of buildings directive. A couple of years ago, Scotland had a choice as to which method and model it would use. There was a consultation on that, to which we responded.

EPCs are generated using a standard assessment procedure, which uses the Buildings Research Establishment domestic energy model 12—I forget the exact sub-version of it, so one of my colleagues watching this probably wants to kick me.

Even though BREDEM has improved over the years, that improvement has been incremental. It was never useful for Scotland in the first place. The original empirical work on the model was done on about 30 semi-detached two-bedroom or three-bedroom properties in Milton Keynes. The further you deviate from standard building archetypes, by which I largely mean standard English building archetypes, the more inaccurate those assessments get—the assessments are of how much energy a building is using and how much it will or will not save under any intervention. The inaccuracies are significant in Scotland; they are exacerbated by traditional build, old build, non-standard building types and the fact that not as much work was done on Scottish properties. By the time you get to an old farmhouse somewhere outside Inverness, you can throw the thing out the window—you genuinely do not know.

It is not just me who is saying that. For years and years, building scientists have said that we can use the models but there are limitations. At this stage, we certainly would not recommend the use of EPCs as a policy driver in the way they are currently being used. The paper that I mention in my written submission is embargoed for the time being, but I will ensure that the committee gets a copy of it when it comes out on 18 December. We have looked at the issue and said that, under the guidance, the EPBD encourages more use of real data. For example, an EPC could state that the building was occupied by a young family household for the last three years and what the average energy consumption was. As a broad assessment, that is the sort of measure that we might recommend.

For a lot of measures, such as installing renewable energy technology, somebody would have to go back in to do a site assessment anyway, so why are we putting it into the EPC that that would give X amount of savings? There should be quite a broad range and it should say that, by the way, somebody needs to come back and have a look.

We can do this. Obviously, with smart technologies coming in, we will be able to get a much better handle on the issue. I am quite critical of the smart meter programme, but smart technology in general is great as a means of getting real and accurate data back to the suppliers and the Government. We are entering a stage when more and more data will come online. We will even be able to get hold of things such as internal temperature data. However, there is a danger that those technologies will benefit the middle class and those who can afford them and who are aware of them first. We need to ensure that good technology gets into homes, and by good, I do not mean the smart meters that are being rolled out at the moment; I mean Google kit or kit developed by proper data managers. I will not recommend any particular technology, but something such as Nest will be better than the subsidised equipment that people can get at the moment.

New York is now subsidising better technologies for households. We could do that for those who need those technologies. The cost would not be substantial, and we would get better data to produce EPCs. Given that the bill looks towards 2040, that could be phased in—there is no reason why we must have everything in place tomorrow. If we know that smart kit is coming online more, we can make more and better use of it.

We do not make enough use of the energy data that local authorities already collect or the household data that housing associations collect, or of the organisations that have the data protection clearance to manage that information. We could start using fairly sensitive information such as health information. We need to consider how we can link in the NHS. We will be proposing—I forget whether it is in the paper that I mentioned or another one—a national energy service along the lines of the NHS. That would be a public energy service that would have the authority to collate and maintain data in a secure environment. That is critical, because the last thing that we want is personal health data being hacked. It has to be behind the sort of public firewall that local authorities and the Government sit behind.

Alexander Stewart

That detail is vital and, as you said, it is being used much better in some locations. Some local authorities are doing that much better than others. There is not consistency across the piece, which is where the difficulty comes, because we are not comparing like with like. Organisations are putting in measures to support households, but it may be validated using data that is not correct, which means that people do not get the best opportunity to manage energy efficiency in their house. What more do we need to do to ensure that people get that opportunity?

Dr Baker

We have developed a study on that although, admittedly, it used data from housing associations and local authorities that were using the data better in the first place. I would defer to my colleague Ron Mould, who now works for the City of Edinburgh Council, on how we do that better, but we need to take the best examples. We need to provide support and get the local authorities together.

Alexander Stewart

So it is about using best practice.

Dr Baker

Yes, and the Scottish Government has to lead on that. It needs to work with the local authorities and housing associations to put in place a data collection framework or some sort of common framework. We have shown that we can do it cost effectively and, give or take a little, at the same cost as the SHCS, so why are we not doing it? That gets back to the question of vested interests.

Graham Simpson

I have a follow-up question on EPCs. Is it possible to develop a Scottish EPC rather than use the UK-wide model?

Dr Baker

Yes, and it is totally within the Scottish Government’s powers to do that. However, the model that we are proposing could actually apply to England and Wales anyway. Nothing in my head says that there is a specific need for Scottish EPCs. There is a need in relation to the models that underlie EPCs, if we are going to continue to use them, although we will argue that, with the exception of new build for the first year or two, we probably do not need modelling at all.

There is a question about whether to spend vast amounts of money on producing a Scottish building model. That would be exorbitantly costly, so why bother? Why do we not just take a step back, look at the requirements of the EPBD and how we can use more of that real data as part of meeting them? We have looked at the EPBD and found that not only does it allow for that, it actually encourages it in the guidance. There is quite a broad scope as to what can be done, and all of it is totally within the Scottish Government’s devolved powers.

I think that that is a yes. We could go a different way and it might be great.

Graham Simpson

I think that it is a yes. If we accept that EPCs are not fit for purpose, we could do something better here.

Dr Baker

We could have an EPC that is different in Scotland.

Graham Simpson

So that is a yes.

Dr Baker

Yes—definitely.

The Convener

I am glad that we clarified that.

Thank you very much for coming and for contributing to our scrutiny of the bill. I suspend the meeting briefly to allow the witnesses to change over.

10:56 Meeting suspended.  11:00 On resuming—  
The Convener

For our second panel, I welcome Liz Marquis, who is the director of the Energy Agency; Lawrie Morgan-Klein, who is the public affairs officer with StepChange Debt Charity Scotland; and, from Argyll and Bute Council housing service, Alasdair Calder, who is its home energy efficiency officer, and Bill Halliday, who is the team lead for housing operations. I thank you all for your submissions. We will go straight to questions from members. Andy, do you want to go first?

Andy Wightman

I was not planning to, convener, but I am happy to go first.

Kenneth Gibson

I will go first if you like.

Andy Wightman

That is okay.

The fuel poverty bill contains a new target, a new definition, a strategy and reporting provisions. Is the new definition better than the old one and will it ultimately deliver better outcomes in the programmes that we design to reduce fuel poverty?

Alasdair Calder (Argyll and Bute Council)

The new fuel poverty definition will be a lot more complicated to convey to householders. It will be a lot more difficult for front-line advisers to provide that test of fuel poverty in their line of work.

The new definition has the benefit that householders who have a large income and high energy costs will no longer be seen as fuel poor. That is a positive. However, there are definite issues in relation to the rural factor and other elements that are not addressed in the new definition. That is a massive concern for us.

Andy Wightman

Before others come in, I will just pick up on that response. You say in your submission:

“the new definition is extremely difficult to explain to householders”,

which

“will make it difficult for advisors on the front line.”

You have just made that point again. However, to pursue my line of questioning in previous sessions, my understanding is that the new definition is not designed for front-line advisers, for speaking to people on the doorstep or for engaging people in a local authority area; it is designed to give us a national figure for the percentage of people living in fuel poverty.

Alasdair Calder

In delivering programmes, we will still have to use the definition to establish who is fuel poor and who is not.

Andy Wightman

Do you do that at the moment with the current definition?

Alasdair Calder

For our home energy efficiency programmes for Scotland area-based schemes—HEEPS ABS—we currently use a proxy of council tax bands A to C and, for rural and island areas, we use EPC band E and below.

Andy Wightman

Will you continue to use a proxy with the new definition?

Alasdair Calder

That will depend on whether we can make any real improvement in targeting of fuel-poor households but, for the time being, we will continue to use the proxy.

Andy Wightman

If, under the current definition, which is relatively straightforward, you are using proxies to design programmes, under a more complex definition, it is hard to see how you would—

Alasdair Calder

We are using the proxy of council tax bands A to C under Scottish Government guidance.

Andy Wightman

I understand that. That is helpful.

Would other panel members like to comment on the original question?

Liz Marquis (Energy Agency)

In principle, it is a good idea to redefine the fuel poor, but I concur with what Norrie Kerr said at the 21 November committee meeting, which was that the definition has been redesigned several times in the past 10 years and, every time that happens, the number of people defined as being in fuel poverty goes down. In some ways, it is good to have a new definition, and it takes out some people who live in larger homes, but we need to keep in mind that there are still huge numbers of people in fuel poverty.

One of the schemes that we run in Dumfries and Galloway is a fuel poverty assistance scheme. We use a proxy, but it is very easy to use a proxy when we can explain the way that the Scottish Government defines fuel poverty. The more complications there are, the more difficult it will become to explain to the public why one person is able to get a new boiler—or external wall insulation, which is even more obvious—and their next-door neighbour cannot, because they are not included in the definition.

It is also important to remember that there are still a lot of people in extreme fuel poverty. We must not lose sight of that in the definition.

Andy Wightman

You say that it would be difficult to explain what is happening in that situation but, at the moment, you are not using the existing definition. The question of who gets and does not get support is determined by the guidance and the Scottish Government, is it not? Will the new definition change that fundamentally?

Liz Marquis

Under the area-based schemes and the energy efficient Scotland schemes, we use the proxy. However, we have another scheme in Dumfries and Galloway, which I would like to talk about later, which is specifically designed to be almost an emergency help system—it was set up under a fuel poverty banner by the council. In relation to that scheme, it is easy to use the current definition and just say that, if someone uses more than 10 per cent of their income on their fuel bills, we can help them.

Andy Wightman

So you are using the actual definition directly and deliberately.

Liz Marquis

Yes, and the process is quick and easy.

Lawrie Morgan-Klein (StepChange Debt Charity)

We have a concern about the arbitrary nature of a definition—these things are always like that. We sampled around 2,000 or 2,200 of our clients in the G prefix postcode areas and found that, of the 465 clients who did not meet the new definition, about 83 were marginally outside it, which means that they were spending between 9 per cent and 10 per cent of their adjusted net income on their fuel costs. They were definitely in financial distress and were almost certainly rationing energy and suffering the ill effects of fuel poverty. It seems to be a bit self-defeating to define fuel poverty in a way that misses out people who are in such situations.

We are also concerned about how arrears are reckoned in the definition. For example, one client in our sample who did not meet the definition had £5,000 of energy arrears. Hopefully, their solution involved spending a sufficient amount to cover their on-going fuel costs, but I would be surprised if they were not managing that below what was a comfortable level in order to pay off their arrears.

The other issue concerns a situation in which somebody is making a token payment towards their arrears—say, £1 a month—rather than paying a higher level along with their existing heating. That might disguise the full extent of their arrears.

Andy Wightman

You provide some good examples of relevant situations, but I come back to the fact that the definition of fuel poverty in the bill is to enable the Government to arrive at a national picture of the proportion of people living in fuel poverty. That means that examples concerning people who are in arrears or who live on an island that now has fewer ferry services are neither here nor there, because those circumstances cannot be captured by the definition.

Are you saying that it is important to design the delivery programmes to ensure that we are not too rigid about who gets support?

Lawrie Morgan-Klein

There is an element of trying to ensure that the system is not too rigid. However, also, a national picture should surely not be blurry. I do not think that the intention of establishing a national picture can be to miss out people who are experiencing fuel poverty.

Andy Wightman

You make a good point about arrears. Of course, in any sampling—what we are talking about is derived from a sample—arrears would be a small factor. However, I absolutely take the point that people who are in arrears might not be considered to be in fuel poverty according to the definition, which means that there are questions to be asked about that.

I have a question about raising the vulnerability threshold in the definition from 60 to 75. Is that a good idea?

Bill Halliday (Argyll and Bute Council)

It is not a particularly good idea. I am not sure how susceptibility to the ill effects of cold depends simply on age—it is more complicated than that. Issues of health and poverty are involved, too, and age is also a factor. Older people tend to be at home more and need higher heating regimes. The bill will define people who need a higher heating regime. To an extent, if they need a higher heating regime, that suggests that they are vulnerable to the ill effects of cold. That should be the vulnerability factor, rather than just age. Also, 75 seems to be slightly high, in terms of age. Between the ages of 60 and 75, a person’s health can go one way or the other, and 75 is too arbitrary and too high.

The Convener

You seem to be suggesting that the issue lies not with the rise in the age, but in the use of age in the definition. Would you just remove age all together?

Bill Halliday

If someone is vulnerable to cold and the ill effects of cold—

The Convener

That is already dealt with later on, is it not?

Bill Halliday

Yes. It depends on what vulnerability is going to be used for. If it is to be a passport to schemes and benefits, using age is too imprecise, because people who are susceptible to the ill effects of cold will be missed out. It needs to be far broader than just age.

Andy Wightman

Again, some of that relates to how one designs the implementation of schemes and targets resources.

Finally, I have a general question. Is it your view that, were the bill to be enacted, we would be able to spend the proposed hundreds of millions of pounds on reducing fuel poverty more efficiently? Alternatively, would it make very little difference to any current inefficiencies in spending that might exist?

Bill Halliday

Alasdair Calder referred to that earlier. If you are trying to identify people who are in fuel poverty in order to help them, such as a Mr and Mrs Smith who live at 21 High Street, the best way to do that is for Mr and Mrs Smith to recognise that they are in fuel poverty and to contact the relevant authorities to ask for help, rather than the authorities having to seek people out. The more complicated the definition is, the less likely it is that people will recognise themselves as being in fuel poverty and will then seek the help that we want to give them to get them out of it.

Liz Marquis

There will always be people moving in and out of fuel poverty, so it is important that we address the properties. If we can get the property improvement levels up, in the long term, we will reduce fuel poverty. However, there is a difficulty if you target the individual. You will improve a property for the long term, but we have to recognise there will always be people who move in and out of fuel poverty through personal circumstances or health. At the moment, a lot of schemes target the property but use the proxy system for those in poverty, but there are also the national schemes, which are more focused on the humans. Trying to get those two approaches to match is difficult when we are working on the ground. It is much cheaper to do whole areas, because the measures can be taken at a price that is much better value, whereas it is much more expensive to do individual properties all over the place.

Therefore, we need the mix of targeting properties and targeting people. We have that at the moment, and I encourage the retention of that, rather than going entirely for the human end and not focusing on the properties.

Graham Simpson

My question follows on from that. I do not know whether the witnesses were here for the earlier session, but there was quite a bit of questioning of Dr Baker and his at-times somewhat confusing views on a fabric-first approach. Is it worth having a fabric-first approach, which means dealing with the property and making it more energy efficient?

Liz Marquis

I would say absolutely definitely that we should do the property. We were here in time to hear the discussion of energy performance certificates. I have more faith in those, but we might get on to that later.

11:15  
Lawrie Morgan-Klein

We deal with our clients in a different way, because our experience with them is when they are in a problem-debt situation, which can be an acute crisis and can often involve a lot of different agencies in supporting someone. From our perspective, there should perhaps be more of a folk-first approach, but the two should not be mutually exclusive.

We want to get someone on to a firm financial footing and get in place a payment arrangement for their arrears. To stop arrears accruing in the future, it might be necessary to deal with the fabric, even though we have to look at income maximisation and welfare advice for that person.

It is probably a bit of both, but we lean more towards looking at somebody’s individual circumstances and how support can be best provided to them.

Alasdair Calder

I echo what Liz Marquis said. We should be looking at properties as a whole, and considering not just energy efficiency but property maintenance and repairs, too.

Kenneth Gibson

We ran out of time with the previous panel, but I want to put one or two points to this panel.

The issue of fabric or folk is crucial and I take on board that we really have to do both. We want to improve the house and, at the same time, give advice to people on maximising their income and changing behaviour to use their heating efficiently.

I noticed some interesting information in Liz Marquis’s submission. You said:

“Alongside anecdotal reports of improvements to existing health conditions, such as COPD and asthma, and reports of improved mood following insulation, pre- and post-health questionnaires have also indicated increases in both physical and mental health scores for those who also perceived their home to be much warmer following ... insulation”.

You went on to say that

“94% agreed the appearance of their home had been improved”,

that there were

“Average fuel bill savings of around £250 per year”,

which is equivalent to 23 per cent, and that the

“Fuel poverty rate was 45% pre-insulation and had fallen to 27% postinsulation”.

There is still an issue after insulation, but it is improved.

Basically, you refute what Dr Baker said about a rebound effect. He was trying to say that people get their house insulated but then just put all the radiators on, so they are no better off. You are smiling, so I take it that you do not agree with that viewpoint.

Liz Marquis

It depends on the property—

Kenneth Gibson

And the individual.

Liz Marquis

Yes, and the individual. The health studies that we are working on are on the back of the area-based schemes, where the properties tend to be difficult to heat in the first place. They are suitable for external wall insulation, which means that the heat escapes really quickly out of the external fabric of the house, and they are area based, so a lot are being done in one area. People are very positive about how much their area is improved, which affects their mental health. For example, they are happy for people to drop them off because they are proud of where they live, whereas, before, they did not want people to know where they lived.

I think that you quoted the part of the submission that said that 94 per cent of respondents agreed that the overall condition of their home had been improved. The few people who are not positive about it tend to be those where only part of the property has been done, or who are in an area where an area-based approach has not been used. That happens more in Dumfries and Galloway because of the nature of the schemes there, which are mostly individual homes. That is why not everybody is convinced.

There are several case studies on the back of a report, which I can send round afterwards. In some, there was a reduction in gas consumption of 60 per cent and, in others, it was 40 per cent. That highlights that people are varied and live at such different temperatures. For example, there was the elderly retired lady on her own living at an average temperature of 14.7°C over a three-week period. All our temperature and humidity measurements are done over three weeks. The graphs show a week only, because it gets too complicated, but they are extrapolated from the three-week graph. Once that lady’s external wall insulation was done, she was living at 15.7°C, and she thought that she had won a watch because she found it so hot. Probably, most of us have living rooms that are 21°C so we would find that really cold, but she thought that it was great and that her health had improved.

We are also looking at whether there is an impact on children’s attainment levels. People have told us that, instead of everybody in a cold house living in one room, which at least is warm because everybody is in it—the dog, the telly, the food and the kids who are trying to do their homework—as soon as the house is insulated, they can use more rooms in a whole house. The children can then do their homework in a separate room, which must have a major impact.

With regard to the health benefits, people say that their arthritis improves and we see improvements in chronic obstructive pulmonary disease and mental health very quickly. More analysis is being completed by NHS Ayrshire and Arran on how much we can define the impact of health by taking out the other compounding factors. We are nervous about getting too involved in that, because taking money from a health budget and putting it into energy efficiency might be quite controversial, even if we save money by doing it. However, for the whole Scottish budget, it must have a major impact. We can perhaps also show the impact on children’s attainment. We need to think of energy efficiency as a vital part of our fabric and the world that we live in. Nobody should live in really cold, damp homes.

The Convener

Your point about homework was interesting. I was previously the convener of the Education and Skills Committee, and one thing that came across time and again was that kids cannot do their homework so well because there is no place for them to go. Thank you for that.

Alex Rowley (Mid Scotland and Fife) (Lab)

I will come in on the back of some of those issues. Earlier, people had a go at Dr Baker, but I know where he is coming from with regard to the folk-first approach.

I do not know whether our witnesses have seen the evidence from last week’s committee meeting, when Kenny Gibson said that ever since he has been in Parliament, it has wanted to tackle fuel poverty—it has been a goal of the Scottish Parliament since it was established. We can get a bit down, thinking that we have not really succeeded. There is no doubt, however, that despite the doom and gloom, the reality is that since energy efficiency ratings were introduced, council and housing association housing has improved significantly.

Given that, my first question is this: do you think that we need to look at the issue sector by sector? For example, should we look at having energy efficiency standards for the private rented sector?

My second question is about the folk-first approach that Dr Baker spoke about. This week, I met a project in Fife called the cosy kingdom home energy advice service, which combines free home energy advice and debt advice. In order to tackle fuel poverty, does our strategy need to target more resources through such organisations? Cosy kingdom does home visits and goes out and speaks to people.

My third point is about damp houses, which people spoke about earlier. Individuals saying that their house is damp but the council calls it condensation comes up time and again. I had an email exchange this morning with a lady in Kelty who has a young child. She says that the wallpaper keeps coming off the walls because of the problem, but the council says that it is condensation. Cosy kingdom’s advice is that when people hang wet towels over radiators in winter, the water seeps into the walls, so there is an issue about behaviour, as well.

If we are to succeed in tackling fuel poverty and not give up because energy prices will go up, what do we need to do? The Scottish Government’s financial memorandum says that there is no new money. Do we finally need more money to go in? Has the strategy got to be from the ground, rather than central?

Liz Marquis

There was an awful lot in those questions. I will try to cover a few of the issues.

On the energy performance certificates, in our health study we have been looking at about 340 mixed properties across the whole of Ayrshire and Dumfries and Galloway. A 23 per cent energy saving was calculated from the annual fuel costs that were reported in the energy performance certificates. That study assumes the standard heating regime, so it is not actual savings—it is an average among the households. By comparison, for the properties that we have monitored, the average energy saving based on actual use is similar—it is 22 per cent. In the mixed-housing area in which we have been working, the EPCs are remarkably good.

A large number of people also report a great reduction in condensation as a result of insulation. We do not specifically ask about it; we ask what the improvements have been. Previously, there has been a worry that making houses too airtight might cause an increase in condensation. However, even if external walls are done perfectly and windows are improved, a house is generally still not airtight: there will still be airflow.

The important point is that, as well as there being national schemes, schemes that can be delivered through local agencies should incorporate all the help and advice. The scheme that we are running in Dumfries and Galloway is very much designed around pulling together all the national and local schemes, so that the main benefit is to the householder. We should be looking at that as well as at the property. The money for the two-year programme comes from the council’s tackling poverty strategy, and the intention is to make homes more energy efficient, to boost household incomes and to improve the quality and standard of living. A member of staff from the Energy Agency is based in Dumfries, and we work with all partners to deliver the programme as effectively as possible. We provide brilliant customer service that is centred on human beings.

We are now at the end of year 1 of the two-year period. There is £75,000 to spend per annum, and we have achieved 116 measures in 140 homes. Out of the 30 contractors that we have used so far, 28 have been based within a 20-mile radius of the households, which are in very rural Dumfries and Galloway.

The other key point is that, because we use local contractors, we ensure that we pay their bills quickly—they are paid within seven days of completion of work. We want those contractors to keep wanting to work with us on delivering the schemes. It is a question of everything being in the right category, and of believing that we should focus on the issue.

The average time for getting measures in place is about three weeks from first contact. In the most recent case, it took 14 days for a boiler to be replaced, but that involved someone who needed a mental health support worker with him, so planning the work took slightly longer. There are lots of really good schemes that deliver locally, especially in rural areas where people have to rely on smaller local organisations to do the work.

I am sorry—I will stop talking now.

Bill Halliday

Alex Rowley mentioned the private rented sector. The short answer is yes—we need standards in that sector. It is a difficult nut to crack. Some of my housing association colleagues have difficulties with tenement blocks with mixed ownership, in which there will be owner occupiers and private renters in beside registered social landlords’ tenants, who have to meet the energy efficiency standard for social housing. There are landlords and owners who are not interested in doing such works.

We have had some success with housing association partners utilising the area-based money that is available to do external wall insulation, and Argyll and Bute Council still has a small amount from our private sector housing grant. We have done external fabric repairs to walls and roofs, which have been remarkably successful and have completely transformed properties in terms of their internal energy performance and their external appearance, but such projects are few and far between.

I agree that standards need to be set for the private rented sector. When someone is letting a property, the property should meet the repairing standard. It is up to the Scottish Government to determine what energy standard should come into the repairing standard, but a property should certainly meet a standard on energy performance before it is let to a tenant.

11:30  
Alasdair Calder

On energy efficiency standards in general, we need to bear it in mind that in some rural areas it will be difficult to attain an appropriate EPC rating. We went to a property on the isle of Gigha that was EPC band G01: even after we had installed internal wall insulation, through the HEEPS ABS programme, the property’s rating only went up to G19. That was after significant investment. Rural areas are really discounted, and we need to keep that in mind.

Liz Marquis talked about local delivery partners. Argyll and Bute Council has the Argyll and Bute energy efficiency forum, which brings together local energy agencies, energy trusts and folk who have an interest in fuel poverty, to share best practice and make best use of the resources that are available. I encourage other local authorities to look at what Argyll and Bute is doing.

Lawrie Morgan-Klein

I agree with the point about the private rented sector. In the sample of clients that we identified as meeting the definition, 29 per cent were renting privately—that proportion was marginally ahead of the proportion who were renting from housing associations. The lowest proportion was made up of people with mortgages or who owned their properties outright.

I met the cosy kingdom energy advice service at an event a few months ago: that team does really good work. There are great examples of partnership working, which Liz Marquis talked about, to intervene on multiple different issues.

That takes me back to my point about how viewing the issue in terms of fabric versus folk is far too polarising. There are opportunities to do both. If, during a conversation with someone about improving their home, it emerges that the person has health issues, they can be signposted to an intervention that is much more comprehensive and, ultimately, more successful.

Alex Rowley

Government intervention on energy standards for council and social landlord housing has worked and been successful. There is policy at national level. However, the more I look at the issue and hear about work that your groups are doing, the more I think that we might need regional strategies that take account of variations across the country. For example, there are areas where we need to consider off-grid properties. Should we, if we are serious about reaching the targets, develop more regional strategies, as opposed to having a single strategy for Scotland?

Liz Marquis

We could do that to some extent, but I also appreciate the same standards applying across the board. There is no reason why someone who is in private rented accommodation should be living in a worse property than someone in social housing. The Dumfries and Galloway project is open to every type of housing occupation.

In the energy efficient Scotland programme’s area-based schemes, we are not now able to help private landlords. In principle, I completely agree with that, but in practice it makes things really complicated and can prevent schemes from going ahead. Help for three householders in a block of four can be held up because we cannot help the one private landlord—and it is the people in those properties who are really badly off. I want the Scottish Government to be clear about building standards across the board, so that all domestic properties can be brought up to standard.

Alasdair Calder

I echo what Liz Marquis said about the private rented sector. Argyll and Bute has a high proportion of empty homes, and the only assistance for which they qualify is the equity loan that is currently available, which might not always be a feasible option. We encourage consideration of energy efficiency standards for empty homes and making grant assistance available for such homes.

The Convener

The Scottish Government has set a target of no more than 5 per cent of households being in fuel poverty by 2040, rather than having a zero per cent target. Is a target necessary and, if so, why?

It looks as if Liz Marquis will start the answers again.

Liz Marquis

I just have an expressive face when I am thinking.

A target focuses minds. We do not want to see anybody living in fuel poverty, but the reality—as we have discussed—is that people often slip into it because of personal circumstances, even when the house is not too bad.

I would like to say that we should have nobody in fuel poverty, but that is not a realistic option from where we are at the moment—especially not over the next 10 to 15 years. We need a target, but perhaps it should be no more than 2.5 per cent, rather than 5 per cent. If the target is to do what is practically possible, a 5 per cent target gives too much leeway and space.

Bill Halliday

I go along with that. The target should be that everybody lives in a warm and dry home that they can afford to heat properly. We need a target to focus the mind. With five-yearly reviews, we can adjust and adapt the target as we go along. We definitely need a target to aim for, and having everybody in warm and dry homes by 2040 is not overly ambitious.

Alasdair Calder

I would echo what Bill Halliday has said.

My only other comment would be that I am concerned that by 2040 the households in that 5 per cent fuel-poor households would be disproportionately in rural areas, given the amount that are off the gas grid and the nature of the housing stock.

There are also issues to do with houses being in conservation areas or being listed buildings, because energy efficiency improvements are generally more costly or difficult to implement in such cases.

The Convener

I am sure that my colleague Kenny Gibson will want to come on to that point shortly.

Lawrie Morgan-Klein

I agree about the 5 per cent. The worry is that all the easy stuff gets done and those who are in the most acute difficulty are left in the 5 per cent, with people saying that the target has been met successfully, so let’s have a party.

StepChange’s figures show that electricity arrears is the second-fastest growing debt type—such arrears have gone up by about 37 per cent between 2013 and 2017. Those arrears have also increased faster in Scotland. In 2013, 11 per cent of the clients whom we saw had electricity arrears; that has gone up to 15 per cent. Over the UK, the change has been far less steep—from 13 to 14 per cent. It is a growing problem in Scotland, so we welcome there being a target to tackle it. The timeline to 2040 feels distant, considering that we have seen a 4 per cent increase in clients who are struggling with energy costs, so that is a concern.

The Convener

You say that you have concern about a 2040 target. Do you see the rationale behind it?

Lawrie Morgan-Klein

Obviously, we see that there is realism there. Such things take time, but with a 4 per cent increase in fuel poverty in five years, there is a danger that doing things at that pace will mean that all that we are doing is standing still.

The Convener

Does anyone else have a comment on either the 2040 target or the 5 per cent part of the target?

Liz Marquis

It seems a long way to 2040.

The Convener

It does when you are my age.

Liz Marquis

It would mean only a 1 per cent increase every year, which is not moving very fast.

The Convener

I suspect that Kenny Gibson will come in on that point.

Liz Marquis

My feeling is that the target date needs to be much sooner.

We welcome energy being part of the national infrastructure programme: that is brilliant. However, spending is really needed—spending to get properties warmer is preventative spend. In South Ayrshire and East Ayrshire, we are trying to ascertain whether, in areas where work has been done, there has been a reduction in the police having to follow up social issues. The research needs two or three years, but we think that there is probably a reduction in antisocial behaviour. When we look at the effects of energy efficiency spending on areas including health, education, social behaviour and the strength of communities and local businesses, we see that it makes sense to spend more money on energy efficiency in order to improve other aspects of our society.

The Convener

That was a good plug for getting more money for your sector.

Bill Halliday

We have to be careful. We had the Home Energy Conservation Act 1995, and then we had the 2016 target, which was missed by a long way. This will be a long and slow process, and we have to recognise that we will not achieve change overnight. We can step up improvements to energy efficiency in housing, but tackling fuel poverty and dealing with income levels and fuel costs will take a lot longer.

There is still resistance to switching to lower tariffs, and it will take a long time to change householders’ attitudes. I am a little uncomfortable about bringing behaviour into the discussion, because there is a tendency to sound as though we are saying that people make themselves fuel poor, and I do not believe for a minute that anyone does that. However, there is no doubt that behavioural changes are required. That will take time and resources. I am talking about the old-fashioned resource of feet on the ground—people going out to talk to people and coach them through a process.

I tend to disagree with Liz Marquis about 2040. I do not think that it is very far away—although it might be in other ways.

The Convener

You are younger than me.

You mentioned fuel prices and income levels—two issues in which this Parliament does not have levers. That perhaps makes 2040 a more rational target, given that we cannot be sure what will happen and we might not have the ability to deal with whatever happens. Do you agree?

Bill Halliday

I tend to agree. However, with five-yearly reviews the target can be adjusted as we go along. No doubt, technological changes will improve what can be delivered and will have an impact. I do not know what is coming down the line. Something might create a step change such that Parliament would want to bring forward the target.

However, from where I am sitting today, I think that 2040 is realistic—I have to say “Sorry” to Liz Marquis. If the target is brought forward too far, we risk missing it, as we did in relation to the 1995 act and as happened with the 2016 target. For at least half the time between the setting of the target and 2016, people knew that the target would be missed. We were probably just waiting for that year to pass to find out what would come next.

Alex Rowley

Is there a danger that we are trying to tackle too much and that our approach is so broad that we will end up missing the lot? We talked about warm homes. Most people would not think it overambitious to plan to have watertight warm houses in Scotland. Should we be starting to break down what we are doing instead of combining the issues? I am told that there are 72 suppliers out there, although I think that a couple went bust last week. Is that a separate issue? We cannot control energy prices—we do not have the power to do that—but, surely, it is not too ambitious to say that everyone in Scotland should have a warm watertight house with a heating facility. Is it too ambitious to say that?

Bill Halliday

In some ways, no, but in other ways, yes. We know from the HECA experience and the fact that the 2016 target was not met that it is ambitious and difficult to achieve. Wearing another of my hats, I add that it is proving quite difficult in Scotland to have houses—particularly tenement houses—that are dry and not unstable, never mind anything else. The condition of a lot of our housing stock is quite poor.

11:45  
Liz Marquis

I would be careful about limiting the approach any further. One of our worries about the bill is that it has been narrowed. Previously, it was a warm homes bill, but it has become a fuel poverty bill. We are keen for it to be as wide as possible so that we can target properties of all types through it.

The Convener

Do you accept that it will work in tandem with other legislation that goes through the Parliament?

Liz Marquis

Yes.

Kenneth Gibson

My understanding is that it is one of three bills. We also have the Climate Change (Emissions Reduction Targets) (Scotland) Bill, and a warm homes bill will be introduced in the current session of Parliament. They will tackle all the issues and will complement one another.

On the point about ambition, I think that, at a time of stagnant wages, political uncertainty with Brexit and fuel prices rising by more than inflation, to try to reduce the number of households in fuel poverty by a net 23,000 a year for 20 consecutive years is ambitious. It does not represent a 1 per cent annual decrease; from 600,000 to 140,000 is more like a 4 per cent annual decrease, which I think is ambitious.

I want to ask you about rurality, which has been mentioned a couple of times. Argyll and Bute Council’s submission is quite hard hitting. It is a really good submission. It says:

“given that this is a blanket target which is Scotland wide; there is the potential that householders in remote and rural areas will be disproportionately represented in the residual 5%”.

You have touched on that issue. You go on to say:

“Despite the known additional costs associated with remote and rural areas, there is still no allowance for this in the fuel poverty bill”.

What measures should be implemented to ensure that we do not have the situation that Mr Morgan-Klein mentioned, whereby the low-hanging fruit are dealt with first in order to meet targets and we end up with the people in the deepest fuel poverty and the most difficult hard-to-heat houses being left to the end of the process?

Alasdair Calder

I think I mentioned that the rural factor is not really addressed in the bill. Using the MIS, which is a UK-based approach, does not really make sense for us. We could look at developing a Scottish minimum income standard with a rural element. Alternatively, if the way forward is to continue to use the UK-wide MIS, I suggest that we consider having, instead of a 90 per cent measurement against fuel poverty to account for rural areas, a 110 or 120 per cent measurement to take account of areas where there are higher energy costs for things such as oil and electric heating. I do not believe that that would substantially change the position for folk who heat their homes using gas, which is substantially cheaper. That might be a way of capturing the rural issue.

Kenneth Gibson

Okay. Professor Hirsch, who gave evidence before you, said that there is not really any difference between urban Scotland and urban England, excluding London, so there is no real necessity to have a Scottish MIS. However, there is an argument for a rural MIS, whether or not the committee and the Government agree on that. I would say that it should be a remote, rural and island MIS. Would all of Argyll and Bute be included in that or would you define it more strictly? How would you define it? With the best will in the world, we might all be in favour of that but I do not know, because the committee has not discussed the matter yet.

How should we grapple with that and deliver it? It is one thing to say that we should have it, but how can we get down to the nitty-gritty and tackle the really difficult hard-to-heat houses in rural Scotland and, indeed, other parts of Scotland?

Alasdair Calder

We have a remote rural and island uplift of £9,000 through the HEEPS ABS programme. That amount is based on the eightfold definition of rurality, which works quite well in some but not all instances. Campbeltown is a really good example in that regard. It is a band 5 area but it is extremely rural, in my opinion. It is very difficult to get contractors to work there, and there are supply chain issues linked to its rurality. It is a difficult issue, if I am honest, but the eightfold definition, with a few tweaks, would work favourably in identifying rural properties.

Kenneth Gibson

Mr Halliday comes from the same local authority. Do you have anything to add?

Bill Halliday

No, not particularly. I agree with everything that Alasdair has said. Argyll and Bute, which goes from Helensburgh to Tiree, has about 200 small communities. There is no ferry journey to get to Kintyre, but, given the time that it takes to get down the peninsula, it is remote.

Kenneth Gibson

The ferry runs about three times a week in the summer.

Bill Halliday

It runs much less often than that for those who live in Helensburgh, which is on the boundaries of the urban conurbation of the west-central belt. Some towns have gas, but it is not from the grid; it is transported in.

Kenneth Gibson

It is Calor gas.

Bill Halliday

There are 23 inhabited islands, which adds another layer of difficulty.

I would use the factors that Ali Calder mentioned. That would produce a reasonable outcome for us.

Kenneth Gibson

Do you want to add anything, Liz? This is a key issue for remote rural and island areas.

Liz Marquis

Yes, it is a major issue for south-west Scotland, particularly down in Dumfries and Galloway and the more rural areas of the Ayrshires. It depends on what you are trying to do. If you are installing boilers, as in Dumfries and Galloway, you can use local contractors. If you are trying to install external wall insulation, you need to use the bigger companies, which are based in the central belt. There is a real problem, depending on what issue you are trying to solve. External wall insulation is the most difficult type of installation to provide.

Kenneth Gibson

We have an all-Scotland target of no more than 5 per cent of households being in fuel poverty. Should the target of 5 per cent be set for each local authority? Should each local authority be incentivised to ensure that the more difficult properties are tackled first? How do we get round the low-hanging fruit issue that Mr Morgan-Klein and others have mentioned? That is the nub of what we are trying to do. It is about not just reducing the number of households in poverty but not leaving a situation in which 95 per cent of homes are heated well and the other 5 per cent are horrendous.

Liz Marquis

I have no solution. It is a real issue.

Bill Halliday

It is possible that the target could be set by local authority area. We have nine distinct housing market areas in our local housing strategy, and we could operate the target at that level—we could say that the 5 per cent target applied in each housing market area. There is the potential to apply the target at lower levels, on an area basis.

Kenneth Gibson

You would need an incentive, because councils are not exactly awash with money. If there were five houses for each of which the measures would cost £5,000 and there were another five houses for each of which the measures would cost £15,000, more people could be helped by fixing the cheaper homes. Therefore, you might want a subsidy or additional resources to make up the £10,000 difference in that example.

Bill Halliday

Resources are always important. One of our housing market areas is Tiree and Coll, where there are difficult house types and there is the issue of—

Kenneth Gibson

Getting the workforce over there.

Bill Halliday

There is the issue of getting the workforce over there, the supply chain issue and the difficulty of the location. That all adds up to its being an extremely difficult area to deal with, for which extra resources will be needed.

At the same time, if we addressed the whole of Argyll and Bute, we would not want our 5 per cent to be disproportionately located on our islands or in remote rural areas. Whatever the challenge is nationally, we should face that challenge locally to make sure that we have a good distribution of all the schemes that we operate.

Liz Marquis

The area-based schemes that we are talking about have some flexibility. That is really important—everything should not be too rigid; there should be a bit of flexibility. The project in Dumfries and Galloway that I have been talking about comes out of the council’s budgets for tackling poverty in the area.

There are creative ways of doing things inexpensively that help lots of people. We should try to combine that creativity with quite rigid rules about what we should be doing and achieving in the long term.

Andy Wightman

I have a couple of questions on slightly different topics. One member of the panel talked about extreme fuel poverty, and, at the committee meeting on 21 November, I think it was Di Alexander who advocated a separate target for its eradication. Extreme fuel poverty is based on fuel taking up a minimum of 20 per cent of a household’s income. What are the panel’s views?

Liz Marquis

I am positive about Di Alexander’s comments. It makes sense to have a separate target to avoid the risk that the harder-to-reach properties and people vanish from the schemes.

Lawrie Morgan-Klein

We would welcome that target as well. We see acute cases in which people who are vulnerable and in real financial difficulty face extensive arrears and challenges in heating their homes. Such a target would be of interest.

Bill Halliday

We started off by saying that targets focus the mind. It is important that we focus on the difficult cases, so I agree with the rest of the panel.

Andy Wightman

On scrutiny and monitoring, section 6 of the bill makes provision for the Scottish ministers to prepare a report. However, there are no provisions for independent scrutiny or monitoring such as are included in other bills that the Parliament has passed. For example, the Climate Change (Scotland) Act 2009 provides for independent scrutiny by the Scottish Committee on Climate Change, and the Child Poverty (Scotland) Act 2017 provides for independent scrutiny by the Poverty and Inequality Commission.

Given that we do not know whether we will reach whatever target is set—obviously, as it is in the future—would it be useful to have an honest appraisal of the extent to which we are meeting it and what would need to change in order for us to meet it? Does the panel have views on how we could have advanced scrutiny and monitoring provisions in the bill?

Bill Halliday

I agree with what you say, but I do not know how it could be achieved.

Andy Wightman

One suggestion is to involve an independent body.

Bill Halliday

Yes, if an independent body reviewed and monitored the target and made recommendations, that would be good.

Andy Wightman

It is fair to say that you have not given much thought to the proposal. If you want to come back to the committee on the issue, please feel free to do so.

Bill Halliday

Okay.

Andy Wightman

My final question is on a small technical point. As panel members probably know, when the Parliament passes legislation, it gets royal assent but does not come into force until it is commenced. The commencement provisions in section 13 say only that sections 13 and 14, which is the short title, will

“come into force on the day after Royal Assent”.

In other words, nothing will happen other than the piece of paper becoming law. Nothing will start until ministers decide that it will start. None of the sections will come into force until ministers decide that they will.

Do you have views on whether we should seek to amend the bill to ensure that some of its provisions come into effect on defined dates? If panel members have not given much thought to that point, you would be welcome to write to the committee.

Alasdair Calder

I have not given much thought to it, so I will write to the committee.

Andy Wightman

That is fine.

Liz Marquis

May I add something about independent monitoring? All the councils report on the area-based schemes on a quarterly basis, detailing how much work has been done and how much money has been spent, and some of the other schemes are reported on regularly to the Scottish Government. It is essential that there is an independent monitoring organisation that can evaluate and be clear about what is happening. That work may be done by a part of Government or it could be provided in another way, but that organisation needs to be there to ensure that we are delivering what we should.

The reports should go to that body at least annually and to the Government on a five-year basis, if not more often. If there is a fall in output or delivery, there should be ways of addressing that. That is essential. We can have great ideas but, unless the reporting is done correctly and in a valid way, we may not be making any difference to people’s lives.

12:00  
Andy Wightman

You are talking about examples of reporting on programmes—

Liz Marquis

Yes.

Andy Wightman

But the bill is not about programmes. Clearly, that is for the Government to decide.

Liz Marquis

Sorry.

Andy Wightman

The bill sets out a definition and a target, and it provides for five-yearly reporting by the Government. All that I am asking is whether there should be independent scrutiny of the extent to which we are meeting the target, what might need to change in order for us to do that and, if new technology came along that produced a step change, the extent to which that technology would allow the target to be brought forward. I am asking about independent scrutiny of the bill’s provisions, not the programmes that are delivered.

Liz Marquis

I think that there should be independent scrutiny, but I make it clear that I would like money to be spent on programmes that work on the ground. There is a balance to be struck in not spending a lot of money on scrutiny, as there is obviously a limit to how much money there is, but we need scrutiny of the bill’s provisions to be sure that we are achieving the fuel poverty targets, never mind anything else.

Andy Wightman

One proposition is that there should be independent evaluation of the four drivers.

Liz Marquis

Yes.

Andy Wightman

When I talk about independent scrutiny, I am talking about providing Parliament with the ability to hold the Executive to account on the money that it spends and the policies that it adopts. I am not talking about the monitoring of the Government, which goes on anyway.

Liz Marquis

As part of the Existing Homes Alliance, we are definitely focused on that. We can come back to you with more information on that, perhaps this afternoon.

Andy Wightman

That is fine.

Graham Simpson

I think that Liz Marquis said earlier that changing the definition of fuel poverty had reduced the number of people in such poverty. That could, of course, suit Governments of any colour. However, as the Delegated Powers and Law Reform Committee has pointed out, the bill as drafted contains quite wide powers to change that definition again, under affirmative procedure. Are any of you concerned that Governments can just come along and change that definition at any time they like for whatever reason, reducing yet again the number of people who are in fuel poverty?

Liz Marquis

That is a possible risk. I do not know whether anyone else has anything to say about that. The Existing Homes Alliance is focusing on that provision, too, and we will come back with comments on it.

Alexander Stewart

One of the witnesses on the previous panel made some real criticisms of energy performance certificates. Do you see any opportunities in that respect? Has the approach been validated? How is it looked on? It would be useful to hear your views on that.

Liz Marquis

Someone seemed to suggest that we could have a Scottish energy performance system that would build on what we already have. The way in which the energy performance certificates are completed is being tweaked, but the fact is that we already have those certificates and people are beginning to understand them. They have been in place for a long time now for those who are buying, selling or renting properties, although people are still much more worried about location than about their home’s energy performance.

That said, I think that the system is gradually coming into people’s conscious minds more and more, and I would not want it to be thrown out completely. The certificates have their place, and, certainly in the properties that we have been working on, they seem to be closely aligned with what is happening in the property both in theory and in reality.

The situation varies. When the EPC for one rural property was changed to say that it was part of a hamlet instead of being an individual property on its own, its rating went up substantially. Some of the ways in which these things are calculated are strange, and the system itself is very complicated, but Energy Action Scotland and various other organisations are looking at whether certain tweaks can be made that would be much less expensive than redesigning the whole system.

Alasdair Calder

When you say that a property is in a rural location, one of the measures that come up for it is a wind turbine, which is not always feasible or cost effective. That aspect of the EPC needs to be looked at, but I think that the certificate itself gives a good indication of the property as a whole.

Annabelle Ewing

Just for the sake of completeness, I want to go back to the issue of reporting. Last week, I asked panel members about the frequency of reporting, and it would be helpful to get some comments on the proposal in the bill for a five-yearly reporting frequency.

Bill Halliday

I think that a five-year period is adequate, because it fits in with the local housing strategy five-year programme. To that extent, it marries up quite well.

However, I note that we give annual updates on the strategic housing investment programme and the proposals for rapid rehousing. We could have short annual reviews with a more comprehensive review every five years, but, to be honest, I think that it is manageable either way. You will not want to spend too much time on putting major annual reports together, because that will take the focus away from delivery. Five years is long enough to have some concerns about what is going on and to look at whether you are on the right pathway. You do not want to start your report in year 4 and think, “Help ma boab! It’s too late for us to make it.” Things can be managed within that process.

Alasdair Calder

I think that the frequency should be every two or three years, because that would allow for better reporting and an evaluation of how each programme was working and whether any tweaks could be made to ensure that there was a focus on fuel-poor households.

Lawrie Morgan-Klein

I would agree with reporting every two to three years—five years seems a bit long to me. I go back to my point about the average electricity arrears of our clients going up 37 per cent in the previous five years. The danger in waiting five years before we look at this is that things just move far too quickly.

Liz Marquis

I would say that the frequency should definitely be two to three years. We need to bear in mind Andy Wightman’s point about how long it might take to do something if we find, when the legislation comes into force, that things have fallen behind. Reporting needs to happen every two to three years to ensure that we can put something in place to improve the situation.

Annabelle Ewing

On the substance of reporting, last week, I asked the panellists whether it should cover the four drivers of fuel poverty. Do you have any comments on that?

Liz Marquis

It is essential that it covers all four drivers, if that is possible.

Lawrie Morgan-Klein

I agree. It is really important that the income issues are fully understood, because we see income as the primary driver of people’s arrears issues.

Alasdair Calder

I agree.

Bill Halliday

Because we do not have our hands on all the levers to eliminate fuel poverty, it is essential that we look at all four drivers. We tend to focus on those that we can influence the most. There is nothing particularly wrong with that, but, by looking at all four, we will ensure that the others are not forgotten.

The Convener

I thank all our witnesses for coming along and contributing to our scrutiny of the bill. That concludes the public part of today’s meeting.

12:08 Meeting continued in private until 12:24.  
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Third meeting transcript 

The Convener (James Dornan)

Good morning and welcome to the 36th meeting in 2018 of the Local Government and Communities Committee. I remind everyone present to turn off their mobile phones. As meeting papers are provided in digital format, tablets may be used by members during the meeting. We have received apologies from Alex Rowley.

This is the fourth day of stage 1 evidence on the Fuel Poverty (Target, Definition and Strategy) (Scotland) Bill, and it is our final evidence session before we consider our report to Parliament on the bill in the new year. I welcome from the Scottish Government Kevin Stewart, Minister for Local Government, Housing and Planning; Amanda Callaghan, head of the tackling fuel poverty unit; and Allie Clarkson, statistician. I also welcome Jackie Baillie and Liam McArthur, who are in attendance for this item.

I invite the minister to make a short opening statement.

The Minister for Local Government, Housing and Planning (Kevin Stewart)

As you know, the Fuel Poverty (Target, Definition and Strategy) (Scotland) Bill has three key aims: to set a target that, by 2040, no more than 5 per cent of Scottish households are in fuel poverty; to create a new definition that better aligns fuel poverty with relative income poverty; and to produce a long-term fuel poverty strategy. Scotland is one of only a handful of European countries to define fuel poverty, let alone set a goal to eradicate it. Achieving the target will place Scotland among the very best countries in the world in terms of tackling fuel poverty. Ahead of questions, I will say a few words on each of the three aims.

There is no doubt in my mind that our target is challenging but achievable and, importantly, deliverable. Of the four key drivers of fuel poverty, two are outwith our direct control: fuel prices and income. Therefore, we are concentrating on the two drivers that we can change: poor energy efficiency and how energy is used in the home. We must bear in mind that most Scottish homes are owner occupied. Bringing such households out of fuel poverty will involve an unprecedented level of intervention in private homes that relies on technology being affordable and in line with low-carbon technologies.

Bringing forward the target date would risk a rise in fuel poverty, due to higher installation or operating costs for households. The 2040 target gives us time to bring the public with us, and it aligns with the energy efficient Scotland programme’s target of all fuel-poor households reaching a band B energy performance certificate by 2040, if that is technically feasible, cost effective and affordable.

We want Scotland to continue as a world leader in tackling fuel poverty, so it is important that we create jobs and opportunities for new workforce skill sets and that we allow local supply chains to evolve to deliver low-cost and low-carbon heating solutions in their local communities, to ensure that local economies feel the benefit.

I make it clear that I expect considerable progress to have been made in our fight against fuel poverty well ahead of the 2040 target date. Our draft fuel poverty strategy, which was published alongside the bill, contains important interim milestones. The first of those is that, by 2030, the overall fuel poverty rate will be less than 15 per cent. The second is that the median fuel poverty gap, based on 2015 prices before adding inflation, will be no more than £350. I intend to lodge amendments at stage 2 that will enshrine those two ambitious interim targets into legislation.

Let me turn to our definition. By bringing the definition of fuel poverty closer to the definition of relative income poverty, we aim to achieve a fairer Scotland. We are determined to put right the situation whereby, under the current definition, some households with low incomes do not qualify as fuel poor. I hope that the committee has had the chance to read the briefing that I sent in advance of today’s session, which highlights that 76,000 more income-poor households would be considered fuel poor than are considered fuel poor under the definition in 2016.

We intend to use the minimum income standard that was produced by the centre for research in social policy at Loughborough University. Our standard will be set at 90 per cent of that standard, after the costs for fuel, housing, council tax, water rates and childcare are deducted. We want the new definition of fuel poverty to work for everyone, no matter where they live in Scotland.

We have listened to calls for the measurement of fuel poverty to include an uplift in the minimum income standard for remote rural areas. In his oral evidence, Alasdair Calder of Argyll and Bute Council suggested an increase to the minimum income standard threshold to over 100 per cent in those areas. In advance of stage 2, I can confirm to the committee that I will look seriously at that suggestion and consider how such an uplift can be best achieved for remote rural areas.

Finally, on our draft strategy, we are determined to continue to work with partners and stakeholders across Scotland to ensure that the final strategy addresses all drivers of fuel poverty. I have had many discussions on the strategy and I know that people want a focus on delivery and to ensure that no one has to live in a cold, damp home.

I look forward to answering your questions.

The Convener

Given that the Government failed to meet the 2016 target, would it be appropriate for penalties of any kind to be put in place to ensure that minimum interim and final targets are in place for the Government?

Kevin Stewart

The huge rise in energy costs in the decade after the target was set in 2002 was a major factor in the inability to meet that target. In that scenario, in which fuel prices rose dramatically, that failure could not have been reasonably foreseen when the target was announced. It would have been unfair to have penalties in such a context. If fuel prices had risen in line with inflation at that point, under the current definition we would have seen fuel poverty figures of 8.5 per cent, rather than 24.9 per cent. If penalties for failure to meet the target had been in place, I do not believe that the 2016 target would have been met.

We do not know which Government will be in power in 2040 and I do not consider it to be appropriate to set out the consequences for a future Administration’s failure to meet the target in the bill. The consequences of not doing so are political and reputational. I hope that, through the five-yearly reporting that is set out in the bill, this Government and future Governments will be scrutinised by this committee and its successors, and by the Parliament as a whole, to see whether we are on track.

The Convener

There has been a lot of talk about bringing forward the timing of the target date to 2030 or 2032—you mentioned that in your opening statement. Can you expand on why 2040 is the optimum timing?

Kevin Stewart

The Scottish Government wants to set a target that is both realistic and achievable. We believe that setting a target of not more than 5 per cent of households being in fuel poverty by 2040 does that.

The 2040 target aligns with the energy performance certificate targets that are in “Energy Efficient Scotland: route map”, and it lends itself to the achievement of the interim target in the Climate Change (Emissions Reduction Targets) (Scotland) Bill that by 2040 Scotland’s net emissions must be at least 78 per cent lower than the baseline. If we bring the fuel poverty target forward to an earlier year, that would mean utilising technologies to reduce fuel poverty that rely on existing high-carbon heating fuels. In some cases, that might lead to households needing two interventions in order to meet climate change objectives as well as everything else.

Another key thing, which I touched on briefly in my opening remarks, is ensuring that the country gets the ultimate amount of benefit from the programme. I have previously spoken to some of the members here about various aspects of delivery, so I am sorry if I bore them by repeating myself. When I was first appointed to this role, it was suggested that I take away some of the HEEPS ABS—home energy efficiency programmes for Scotland area-based schemes—money that Orkney had received, because it had not been used. However, we could see that it had not been used because, initially, the pipeline of work was not there to get the skill set up and allow folk to get on with the job.

In setting this target, we can set in place a pipeline that allows companies to boost the skill sets that are required in various parts of Scotland, rural and urban. They can then benefit in terms of employability in delivering the schemes. I think that 2040 is realistic; it is ambitious, but we can do it. As I outlined in my opening remarks, I am willing to put interim targets into legislation to ensure that we continue to move forward.

The Convener

Are you suggesting that, if the target was brought in earlier, larger companies rather than local workforces would benefit?

Kevin Stewart

It is likely that larger companies that could tool up more quickly would benefit. Beyond that, we would miss opportunities to allow small and medium-sized enterprises to carry out the work. However, one of the key things is that, if we brought it forward, we might need two sets of interventions in folk’s houses. We might need an intervention using existing technology that we would have to get rid of and replace with more carbon-efficient technologies in the future. There is a logic to the target date. It is realistic, ambitious and deliverable.

The Convener

My last question concerns the 5 per cent target. Why are you setting the target at 5 per cent rather than 0 per cent, which will potentially leave 140,000 households in fuel poverty by 2040?

Kevin Stewart

The Government is committed to tackling fuel poverty wherever it exists in Scotland. We have a long-term ambition to eradicate it and we will keep working towards that. At the same time, it is important to recognise that some households will without doubt move in and out of fuel poverty. We can deal with aspects such as the energy efficiency programme and changing people’s behaviours, but we have no control over people’s incomes or fuel prices. There will always be a small number of people who move in and out of fuel poverty due to a change in their income or the cost of energy.

It is also important to note that the target is for no more than 5 per cent of households to be in fuel poverty by 2040. If we manage to get the level down to 5 per cent, we will not just say, “Job done” and stop trying; our ambition is to ensure that as many folk as possible are out of fuel poverty.

09:45  
Kenneth Gibson (Cunninghame North) (SNP)

I was heartened to hear you talk about raising the minimum income standard in rural and island communities to 100 or even 110 per cent.

The evidence that we have received suggests that what is important is not just the extent of the problem but clarity on how we define such communities and address the issue. For example, Kirkwall, Lerwick, Rothesay and Stornoway do not meet the current definition of “remote rural”, because their populations are more than 3,000. Fuel poverty is an issue for island communities, as I am sure you agree. Liam McArthur will go into detail, but I know that in Orkney 59 per cent of people are in fuel poverty, which is the highest level in Scotland. How can the definitions be amended to cover all people on Scotland’s islands? Can you hone the approach to remote rural areas on the mainland, too?

Kevin Stewart

As I said, I intend to ask my officials to look closely at all aspects of this. You represent islands—Arran and the Cumbraes—so you know full well about island life. You are right: Orkney is classified as remote rural, but Kirkwall is currently classified as a remote town and not as remote rural. We will consider such situations and see what we can do.

We are all very aware of the Islands (Scotland) Act 2018, many parts of which have not yet come into force. I have said that we will carry out an islands impact assessment for all aspects of the bill before stage 3.

Kenneth Gibson

Thank you. That is what it says in the final sentence of the briefing that you supplied to the committee, which I have in front of me.

Last week, I asked local authority representatives how we will tackle fuel poverty across Scotland at local level. We have 32 local authorities with differing fuel poverty rates, which vary from 20 per cent to the 59 per cent in Orkney that I mentioned. In looking to reduce fuel poverty, the Government might look for early wins by addressing the low-hanging fruit rather than areas of deep-seated fuel poverty. One approach to that might be to give each local authority a target, rather than have just a national target. Is the Scottish Government considering such an approach, to ensure that all areas of Scotland address fuel poverty in a proportionate way?

Kevin Stewart

Throughout stage 1, I have continued to have discussions with local authorities the length and breadth of the country and with the Convention of Scottish Local Authorities. That suggestion has not come on to the agenda, but I am willing to consider it in co-operation with local authorities.

Many local authorities have already grasped the low-hanging fruit, utilising the HEEPS ABS resources that were put in place. I recognise that, without a doubt, they need to look much more closely at how to deal with some of the more problematic areas. To their credit, many of them are already doing so; there are innovative schemes throughout the country.

We need to take into account the difficulties that exist in certain places. We as a Government have ensured that the allocation of resource reflects the needs of various places. For example, our island councils benefit from three times more spend per head of population on HEEPS ABS than those on the mainland, because we recognise the differences that exist in those communities.

Three or four weeks ago, I announced further flexibilities in delivery in island communities. We are looking at bringing new things into schemes, such as microgeneration, the removal of asbestos and the installation of oil tanks. We will continue to look at those flexibilities and I will consider having further discussions with local authorities about setting individual targets if that is deemed appropriate.

Kenneth Gibson

Will the targets address extreme fuel poverty, in which a household spends more than 20 per cent of its income on fuel? The annual Scottish house condition survey includes data on that, but it is not mentioned in the bill, the policy memorandum or the draft fuel poverty strategy. One would have thought that you would want to focus on people in extreme fuel poverty first.

Kevin Stewart

In our draft strategy we proposed fuel poverty gap targets for 2030 and 2040, which consider the depth of fuel poverty. That, in effect, is a measurement of the size of the gap between the bill for the fuel that a household requires to stay warm and its spending 10 per cent of its income on fuel. The independent panel suggested such a measure in respect of the proposed new definition; it was suggested as a means by which the severity of fuel poverty can be better understood. The approach that we are proposing in all that we are doing is therefore in line with the panel’s view and is designed to tackle the situation of folks who are in extreme fuel poverty.

The Convener

You can ask one last question, Mr Gibson.

Kenneth Gibson

Thank you, convener. I am grateful for your indulgence.

Energy UK, the trade association that represents energy suppliers, is concerned that

“the target’s ambitious focus on reducing fuel poverty outright will be a challenge … Some factors, such as the regulatory framework around energy prices for example, do not fall within Scotland’s devolved powers.”

Npower, which is one of the big six, said that it is concerned that the Scottish Government has overlooked some of the lessons that were learned from what it called the “poorly designed” 2002 to 2016 target. It says that

“targets can be stretching, but must be controllable”—

which alludes to the fact that fuel costs and incomes are largely outwith the control of the Scottish Government.

Kevin Stewart

I think that our target is ambitious but deliverable. I wish that we had control over the other two levers: energy prices and income. That would make life much easier in terms of the formulation of the bill and its delivery.

We do not control those levers, but that is not to say that we are not making efforts to change some of the things that are going on out there. Colleagues and I have met the energy providers on a number of occasions to discuss the obligations that we feel they should have. For example, I have gone on record on a number of occasions saying that I find the use of prepayment meters in households that are the most fuel poor to be an awful situation. I wish that we had the ability to deal with that, but we do not have those powers—although that is not to say that we will not continue to argue with the energy providers about those issues.

On energy delivery, in 2019 the Scottish Government will consult on proposals for a public energy company for Scotland, which will have the twin objectives that were set out by the First Minister of addressing fuel poverty and supporting economic development. During the consultation, we will seek views on the outline business case that is currently being developed on the Government’s behalf. Although we do not have full control over this area, we will always try, where we can, to put other policies in place to deal with situations that are currently outwith this Parliament’s control.

Andy Wightman (Lothian) (Green)

You said that the Scottish Parliament has no control over people’s incomes. The definition of fuel poverty in the bill refers not to people’s gross incomes, but to their net incomes and their incomes after certain costs have been taken out. Would you agree that we have substantial control over people’s net incomes, on the basis that we control how much income tax and council tax they pay, that we control 15 per cent of the benefits system and that housing costs, rents and so on are all substantially under our control? Public sector workers form 20 per cent of the workforce and we control public sector pay. Therefore, in relation to assessing fuel poverty, the Parliament has a lot of control over people’s net incomes.

Kevin Stewart

There are also a number of areas that we do not control. For example, we do not control the national minimum wage.

I will give an example of an area in which, if the Scottish Parliament had powers, we could make a difference. Universal credit is not controlled by the Parliament, and it has a huge impact. Due to the changes that have been brought in by the United Kingdom Government, there is very little the Scottish Parliament can do about that. Mr Wightman pointed out that we control some aspects of the social security system, but 85 per cent of the system remains under the control of the UK Government.

There are some things that we can do—at the moment, I have officials looking at housing costs and various other aspects of people’s lives and how they affect income—but large swathes of control still lie with the UK Government. Although we can tinker at the edges and sometimes do a little bit more than that, we have to take cognisance of the fact that control over a large number of areas still rests with the UK Government.

Andy Wightman

I do not want to get into a debate about how much control we have but, given that we control income tax, council tax, housing costs and all the rest of it, and given that the bill refers to a net figure, I think that we have more control than you are suggesting.

I will move on to the definition of fuel poverty in the bill. Most of the witnesses have described it—I think that we all recognise this—as a more complex definition than the current one. We have been out visiting local authorities in different parts of Scotland, looking at fuel poverty. In order to deliver the strategy and to implement measures that are designed to reduce fuel poverty, local authorities use proxies including council tax bands and take-up of benefits. Will those proxies have to change substantially as a result of the new definition, which is a more accurate, nuanced and targeted definition of fuel poverty, or are the proxies that are currently used in HEEPS area-based schemes still relevant?

10:00  
Kevin Stewart

The new definition—much like the current one—is primarily a statistical tool for giving us a nationwide picture of fuel poverty. As Mr Wightman rightly points out, our fuel poverty schemes use various proxies including receipt of particular benefits. At present, we have no plans to change the use of proxies. However, we intend to review the proxies that are used for eligibility for our warmer homes Scotland scheme to see whether they could be more closely aligned with the proposed new definition.

We will continue to consider all of that. I am always keen to hear from local authorities about particular circumstances in their areas, where another proxy could be used. I have had discussions with members around this table about that.

Members will be aware that we are also considering a doorstep tool to deal with some of the issues. I know that some stakeholders look on that favourably, but others look on it not so favourably. We will continue to work with people in order to get that right.

Andy Wightman

You circulated a letter to the committee earlier this week and in annex B there is the example of Ann, who is a single parent with a six-year-old child at school. Under the current definition, she is not in fuel poverty, but your workings in annex B show that, under the proposed definition, she would be. Let us say that Ann lives in West Lothian. How does West Lothian Council find Ann, now that she is in fuel poverty?

Kevin Stewart

I am trying to find Ann. Bear with me, convener.

I am unable to answer how West Lothian Council would find Ann, because I am unaware of the day-to-day workings of West Lothian Council in dealing with such things. However, in general terms, having made visits around the country in the course of discussions on the bill, I can tell you that it is fair to say that some councils would be more adept than others at finding Ann and dealing with her situation. We need to ensure that we have the ability everywhere to find the likes of Ann. In some places, Ann would be found easily. In some local authorities, there have been area-based schemes in which people have been spoken to and there are lots of Anns in a particular place. If Ann lived in an area where there is not so much poverty, it would be harder for the local authority to find her. We need to turn that around in co-operation with not only local authorities, but other partners, to ensure that we reach all those people.

Mr Gibson was right to point out that in some places we have already found all the low-hanging fruit and have helped folks—through area-based schemes in particular. We need to become a little more sophisticated in some areas; some local authorities are further advanced than others.

Andy Wightman

Do you agree that a new, more nuanced definition, which would include people like Ann, will be pointless for national statistical purposes unless we are able to locate the people who are in fuel poverty, so that we can take them out of it?

Kevin Stewart

No, I do not agree with that, because that is only part of the picture. As I said, this is a national overview, but it also looks at proxy measures that are relevant to local authorities.

One of the most interesting things about the meetings that I have had over the piece is that we ended up talking about the bill for a very short time—local authorities and other stakeholders are far more interested in how we get better at targeting the folk who are in most need.

We have seen great work going on across the country, including schemes such as HEEPS ABS and through Warmworks Scotland, but we now need to up the level and reach the folk who fall into fuel poverty and who have not yet been covered by the schemes that we have in place. Local authorities, as delivery partners, are best placed to do that; they will put the proxies in place. I know that many local authorities are looking in depth at all this, and we will continue to encourage that.

Graham Simpson (Central Scotland) (Con)

I will jump back to Mr Gibson’s line of questioning. The evidence from the latest house condition survey is that the fuel poverty gap between rural and urban Scotland has widened in a very short time—in the past two years, in fact. I want to be clear about what you are committing to. The minimum income standard was mentioned. You know that we have heard evidence on and calls for a Scotland-specific or rural-specific minimum income standard. Are you committing to introducing either of those at stage 2?

Kevin Stewart

I think that, in his evidence, Professor Hirsch said that a Scotland-wide minimum income standard would not be much different from the UK minimum income standard. I have committed to examining further the issue of remote rural areas, which will take into account what Mr Gibson said about the difference between remote rural and remote towns, because that is an important distinction to make, and to considering the minimum income standard threshold in those areas.

I will ask my officials to examine that issue in depth—I am more than happy to share information with the committee—and then we will decide what is required to move forward on that front.

Graham Simpson

Could that be in the form of an amendment to the bill?

Kevin Stewart

I think that, first of all, we have to find out exactly what difference having that standard would make. Would it make any difference? Obviously, if it was thought that it would make a difference, the likelihood is that there would be amendments lodged recognising that those differences exist. I reiterate that there is a difference between the remote rural aspect and the Scotland aspect. From what I have read of Professor Hirsch’s evidence, there would be little difference between the UK MIS and a Scottish MIS.

Graham Simpson

You are absolutely right.

One key driver of fuel poverty is energy efficiency, which we can do something about in Scotland. That could be through retrofitting existing houses or by building new houses to the highest possible standard. As far as I know, the highest possible standard is passive housing, where you require very little heating indeed. In fact, it can eliminate fuel poverty. Do you have any plans to introduce passive housing as the standard for new housing? What plans do you have to ensure the highest possible standard of retrofitting?

Kevin Stewart

As the committee will be well aware, the Government has opened up a discussion on housing beyond 2021. My colleagues and I have been asking people to act as ambassadors to get as many others as possible involved in that discussion and then respond to the consultation. Many things on the agenda have already been brought up by stakeholders, including consideration of standards. That is the place where we should have the discussion about how we make progress on affordable housing programmes and the delivery of social housing. The new social housing developments such as I visit regularly are all built to a very high standard.

Beyond that, when it comes to such issues, we also have to consider the owner-occupied sector. I have previously said to the committee that I will continue to examine building standards across the board. I had hoped that we would be much further advanced in the work on reviewing building standards but, unfortunately, as the committee well knows, a huge amount of effort on the part of my building standards officials has gone into dealing with the aftermath of the Grenfell tragedy, to ensure that our building standards regulations are absolutely spot on as regards safety. I will not say that we are coming to the end of that work, because we are not, but there is less going on there now, with the independent panels having reported, and we will move on with legislation and other aspects, so there is some free space to consider building standards as a whole. The committee can be assured that I will look to review what is required for all housing types—not just in the affordable and social sector—as we move forward.

Graham Simpson

As you know, committee members recently visited Stornoway. We heard some evidence, which was probably anecdotal, about work that was being carried out on houses not being up to scratch and about there being a lack of monitoring. In other words, the Government—whether it is the Scottish or the UK Government does not really matter—is paying for work to be done on housing, but nobody is following up and checking it. There are cowboys out there who are doing substandard work at public expense. Do you have any plans to sort that out?

Kevin Stewart

On Mr Simpson’s comment about there being no difference between the UK Government and Scottish Government schemes, I say that there is a great difference. Quite a lot of complaints cross my desk about some of the work that has gone on, but a huge amount of those are about UK Government schemes. For example, if we look at the Warmworks Scotland scheme, we can see that the standard of work is high, that customer satisfaction rates are also high and that, where there are difficulties—I am not saying that it is perfect—they are dealt with quickly and efficiently. I wish that the situation were the same with the UK Government schemes.

10:15  

It is interesting that Mr Simpson has raised the point about checks being made, because during the course of visits across the country in the summer, some local authorities suggested to me that some of the people who had those HEEPS area-based schemes delivered to them felt that there was too much checking.

We have to strike a balance. We are getting it right with the schemes that we are delivering; I am not convinced by the UK Government-backed schemes, where there have been people—Mr Simpson describes them as “cowboys”, but I would not use that term—who have not been up to the job and who have left people in very difficult situations.

We have constantly been on to the UK Government to try to resolve these situations. Some steps have been taken at various points. However, a large number of people in Scotland have houses that have been, in some cases, severely damaged by the bad fitting of unsuitable energy efficiency measures.

If anyone, at any point, has anything to tell me about the Scottish schemes, including if they are not working, I will act appropriately and speedily to resolve those situations.

Graham Simpson

You are right—the evidence that we heard was really about the UK schemes, but the work is going on in Scotland. If it is not done properly—if it is a botched job—people can still be left with cold homes even though we have spent taxpayers’ money to get those jobs done.

The committee has to produce a report and I certainly would not be averse to highlighting that as an issue, whichever Government is involved—in this case, it is the UK Government. If you could provide us with some evidence, that would be very useful.

Kevin Stewart

I am quite happy to do so and if the committee, in its report, wants to highlight to the UK Government that it needs to do much better in delivering the schemes that it is responsible for, I would be very happy. If the committee wants to go further and tell the UK Government that it should resolve the difficulties for householders in the east end of Glasgow, in Rutherglen and in many other parts of Scotland, I would welcome that too.

My colleagues and I have communicated with the UK Government about the matter on numerous occasions to try to get it to get its finger out and resolve the problems for folks who, in some cases, cannot sell their homes because they do not have the appropriate building warrants. That is absolutely unacceptable, so I would welcome any help that the committee could give in that regard.

In terms of some of the UK schemes, home energy Scotland won the best customer focus award at the best business awards this year, which is a huge achievement. Its customer service satisfaction rate is 97.7 per cent. I handed out certificates to some employees earlier this year who had achieved 100 per cent customer satisfaction levels, which is quite incredible.

I am being corrected by my officials, because I said “UK schemes” and I should have said “Scottish schemes”—home energy Scotland is a Scottish scheme. Warmworks Scotland won the Government Opportunities best service award for medium and large organisations. In Scotland, we have award-winning schemes, whereas some of the UK schemes, in my book, would not even get the wooden spoon.

The Convener

Thank you very much for that advert for the Scottish schemes. Will you send us that information, which would be really useful?

Kevin Stewart

I am more than happy to share that kind of information with the committee.

Alexander Stewart (Mid Scotland and Fife) (Con)

I want to ask about the consultation requirements as set out in the bill and how they compare with the previous consultation. Were any lessons learned from the previous consultation?

Kevin Stewart

I cannot really talk about the consultation requirements for the previous bill, because that was well before my time.

I am one of those folk who believes that, as well as having the formal consultations, we should get out and about and find out exactly what is happening on the ground. We will continue to liaise with stakeholders who live or have lived in fuel poverty in order to develop not just the strategy but delivery. To get the strategy absolutely right, and for us to be able to direct support appropriately, we must take cognisance of those folks who are most in need, which we will continue to do.

Yesterday, I met a group of tenants from the Wheatley Group housing associations’ welfare reform and social security panel to hear first hand where they think difficulties remain and what they think we should do to move forward. A large part of yesterday’s conversation was on capping the prices that are charged by energy companies, the way that energy companies treat people at certain points, and incomes and benefits—universal credit, in particular. I will continue to listen to folk such as those whom I met yesterday. I am grateful for having spoken to them. You can be assured that we will continue to do that.

Alexander Stewart

We touched on the draft fuel poverty strategy. It would be interesting to get your comments on the criticism of the strategy that the Government has received. It has been said that the strategy lacks detail on specific policies and programmes and focuses too much on energy efficiency. Further, stakeholders have said that they want the opportunity to suggest changes to the strategy. What is your view on that?

Kevin Stewart

There is obviously an emphasis on energy efficiency in the draft fuel poverty strategy, as that is one of the drivers of fuel poverty that we control. However, it provides detail on all four drivers and the support that is available to those who are in need. That includes our national fuel poverty programme, which is the award-winning warmer homes Scotland programme, and the Scottish Government-funded energy Scotland scheme—also award winning—which provides free and impartial energy advice to callers on a freephone hotline. In addition, HES is the only referral route for households experiencing fuel poverty to our national energy efficiency schemes.

It should be noted that, as Alexander Stewart rightly pointed out, what we have is a draft strategy. Our stakeholders at national and local levels have a critical role to play in helping us to develop the final fuel poverty strategy—there is nothing better than a critical friend. This is not all done and dusted. Folk can continue to have their say, and we will listen to them and develop the fuel poverty strategy accordingly.

Alexander Stewart

You have said that it is still a draft strategy, and that there are still options and room for improvement across the piece. That will give local authorities the chance to continue to engage. As we have heard, some authorities seem to be much more attuned because of the level of fuel poverty in their area. Given that there is not the same expertise across local authorities, how will you ensure that all councils get the same opportunity to suggest improvements?

Kevin Stewart

We need to highlight best practice in order to help others. I give the example of what we have done recently to tackle homelessness. As Alexander Stewart is well aware, many local authorities have visited Perth and Kinross Council to look at its rapid rehousing plan, in order to help them as they formulate their rapid rehousing plans. We need to look at the best of the best, and to point local authorities in the direction of the current exemplars.

We need to highlight to people schemes that local authorities have undertaken that might be a little bit different. For example, one of the beneficial schemes from Aberdeen City Council dealt with Victorian tenements. Lessons could be learned from that scheme and exported to other local authorities that have similar housing types. Aside from local authorities, there are third sector organisations that are doing extremely well and pinpointing folk who are in most need. We should take the best of the best and export it.

From my discussions with COSLA, I know that it is happy to help us in that regard. Like us, it wants to get the strategy absolutely right. We need to celebrate the good work that is going on, use the exemplars and spread the message of what can be done.

Annabelle Ewing (Cowdenbeath) (SNP)

On reporting provisions, you will have noted from the evidence that the committee has received that there are different views about the frequency of such a reporting requirement. Although the bill provides for a five-year period, others have suggested that that would be too infrequent. Could you share your views on that issue, given the evidence that the committee has received?

Kevin Stewart

I have talked about the alignment with other aspects of policy, including the Climate Change (Emissions Reduction Targets) (Scotland) Bill, the bill about district heating regimes and other issues that Paul Wheelhouse will introduce at a later point and the energy efficient Scotland programme. We have proposed a five-year reporting cycle in order to align with the development of the reporting for the energy efficient Scotland programme. The report every five years will be a stocktake of progress over the past five years, and it will look forward to the next five years.

In addition, we will continue to publish the Scottish house condition survey, which includes the fuel poverty annual statistics, and our annual programme delivery reports. Therefore, there will still be the annual report in the Scottish house condition survey and the report every five years.

Annabelle Ewing

Those who advocated more frequent reporting—perhaps every two or three years—felt that it would be beneficial and would enable us to take stock of where we are on the journey to the targets that have been set out. Has the minister weighed the benefits of more frequent reporting against any particular challenges he might anticipate in setting a more frequent reporting requirement?

10:30  
Kevin Stewart

There is a logic to aligning the reporting with the energy efficient Scotland reporting. However, if others have said that it should follow a different timescale, I am more than willing to consider that—I am pragmatic. I want to be logical in what we do, which is why we suggested the five-year cycle to align with the energy efficient Scotland work.

It is always important to avoid duplication and unnecessary bureaucracy. We also want to avoid creating a situation in which the burden of reporting becomes greater than the burden of delivering the service—in this case, delivering energy efficiency measures in folk’s homes. I will consider that proposal, but I emphasise that there is a logic to what we have proposed.

Annabelle Ewing

I am pleased that the minister will consider that proposal. The minister will be aware that Citizens Advice Scotland, among other organisations, has suggested that the substance of the reporting should cover the four drivers of fuel poverty. As has been discussed in every evidence session, including this morning, two of those four drivers are not within the direct control of the Scottish Government as the powers currently stand. Notwithstanding that fact, would the minister support the CAS recommendation that the four drivers be included in the substantive reporting?

Kevin Stewart

I absolutely support CAS’s suggestion on that point. Although we do not control two of the drivers, it is imperative that we report on all four of them. That is what CAS has suggested, and people out there would expect us to cover all aspects of fuel poverty, whether or not the Parliament has control of them.

Annabelle Ewing

That is an interesting response. Finally on this suite of issues, there had been a suggestion that the bill include provision for an independent oversight body. What does the minister think about the efficacy of that suggestion?

Kevin Stewart

I believe that the current provisions are robust enough, and I will expect the committee and the Parliament to act as the scrutineers of all of them. We have just talked about reporting periods and, as I said, I am quite pragmatic and am happy to consider those. However, as I said, I do not want duplication or unnecessary additional bureaucracy. The Local Government and Communities Committee has been quite good at carrying out scrutiny over the piece. The scrutiny of the outcomes should be carried out by the committee and the Parliament.

Annabelle Ewing

Okay. Thank you, minister.

Graham Simpson

This is a slightly different area of questioning that relates to the Delegated Powers and Law Reform Committee’s report. I am sorry minister, but it gets a bit technical here. The committee’s report highlighted one of the powers in the bill that would allow the Scottish Government to change the definition of the minimum income standard and to appoint

“another person as the Scottish Government may from time to time determine”

—in other words, someone other than Loughborough University or the Joseph Rowntree Foundation. The committee suggested that that person should be independent of the Scottish Government. What is your take on that, minister?

Kevin Stewart

I came prepared for some DPLRC questions, as they always come up. I think that you are talking about concerns about the number and scope of powers to alter the definition of fuel poverty—

Graham Simpson

That is my next question. You are too well prepared.

Kevin Stewart

I am too well prepared; I thank these folks here—my officials—for that. You are asking about the power in section 2(6)(e)(ii)—see how well prepared I am, Mr Simpson—to use another person to determine the MIS.

As my officials explained to the DPLRC, the intention is that ministers would use that administrative power if they had to react quickly to designate someone other than the academic institution and charitable body that are referred to in section 2(6)(e)(i)—that is, Loughborough University and the Joseph Rowntree Foundation. The power would be used only if those bodies stopped determining the minimum income standard, changed their names or ceased to exist in their current forms.

The difficulty is that, as far as we are aware, Loughborough University is the only body that produces the UK MIS. Having said that, I will have the Scottish Government’s legal team look into the DPLRC’s concerns in more detail. As you know, Loughborough University and the Joseph Rowntree Foundation are the biz when it comes to MIS. [Laughter.]

Graham Simpson

Oh dear. Was that pre-prepared?

Kevin Stewart

It really was not. I am ashamed of myself now.

The Convener

This reminds me of the conference session that we were talking about before the meeting opened. I think that Graham Simpson has another question to ask.

Graham Simpson

I do, and I will ask it with some trepidation.

Kevin Stewart

It is the question that I tried to answer first.

Graham Simpson

There are some wide powers in the bill, one of which is the power to alter the definition of “fuel poverty”. A Government—I am not talking about the current Government—could alter the definition to take people out of fuel poverty. A cynical Government could do that, and the DPLRC was concerned about that. Will you respond to that concern?

Kevin Stewart

I will. In both cases, the regulations would be subject to the affirmative parliamentary procedure. Moreover, under section 11, ministers would be required to consult

“such persons as they consider appropriate”,

who would have to include

“individuals who are living, or have lived, in fuel poverty.”

Thus, regulations that would alter the definition of fuel poverty in the bill would come under a high degree of scrutiny.

I welcome the DPLRC’s questions, because I think that such a level of scrutiny is required. I hope that my response gives you the comfort that you are looking for.

Graham Simpson

Thank you. I appreciate your not throwing in another joke there.

The Convener

That appreciation is unanimous.

I thank Liam McArthur and Jackie Baillie for their patience in sitting through the meeting. Do you have questions for the minister?

Jackie Baillie (Dumbarton) (Lab)

Yes please, convener. It is panto season, given the minister’s jokes.

I declare an interest as the honorary vice-president of Energy Action Scotland and refer members to my entry in the register of members’ interests.

I will stick with definitions for a moment, minister, because I am interested in understanding the thinking behind some of the changes that you have made.

People tell me that pensioners and people living in rural areas suffer most from fuel poverty. I am sure that Liam McArthur will explore one aspect of that. For pensioners, you have moved the definition from age 60, where it currently is, to 75. I am sure you accept that many people in Scotland do not reach the age of 75 but live in acute fuel poverty. Why have you removed them from the definition?

Kevin Stewart

Many people suffer from fuel poverty, and Ms Baillie has highlighted those who live in remote rural areas and older folk. However, in recent reports—including one from Citizens Advice Scotland, if I remember rightly—we have seen that many younger people are now caught in the fuel poverty trap. We have to take cognisance of all parts of society, all demographics and folks who live in urban and rural areas; it is not about just one group of people.

On the situation for older folk, the households that are eligible for enhanced heating will be defined in regulations, and we have said that we will consult on that issue. Many more older people are now living healthy, active and independent lives well into their retirement, and the independent panel that reviewed the definition of fuel poverty recommended that, if an age threshold were to be used to identify one category of households that would be eligible for an enhanced heating regime, it should be in the region of 75 to 80.

In the draft strategy, we propose to adopt the lowest age suggested by the panel, so that a household that has

“at least one member ... aged 75 or over”

would be covered by the enhanced heating regime. However, the strategy does not suggest that being over 75 is the only criterion. It also states that the regime

“is likely to cover those households where: ... at least one member has self-reported as having a physical or mental health condition or illness lasting or expected to last 12 months or more”.

Jackie Baillie

I am sorry that I caused a scramble among your civil servants, who were looking for sticky notes to hand to you.

Kevin Stewart

They want to make sure that I get it absolutely right.

Jackie Baillie

Indeed, but it is very simple. You will acknowledge that, in some parts of Scotland, people do not reach the age of 75 and that, by making that change to the definition, you will cause a 3 per cent drop in who is covered. A substantial number of people will no longer be included. Will you review that? It is not about competing interests; it is about making sure that we catch everybody who is in fuel poverty. For younger people, the definition starts at age five and over. However, surely, the age at which a child is potentially most vulnerable is between 0 and five. Again, will you review that threshold to make sure that the definition is all encompassing?

Kevin Stewart

As I said, we will consult on those issues, and I am sure that folk will put forward their views at that time. When we prepared those aspects of the bill, we looked carefully at what the independent panel had suggested.

Jackie Baillie

I have a final small question that relates to finance, which is, of course, important for the bill. There have been some accusations that this is a bit like business as usual. Back in 2006, Energy Action Scotland said that the Government needed £200 million a year if it was to hit its target. You have just over £100 million in the budget now, £30 million of which is in financial transactions, so it is repayable. Is that enough? Have you done modelling for your target of 2040—which may or may not be the one that we end up with—to see whether that amount is sufficient to deliver on your vision?

10:45  
Kevin Stewart

I might write to the committee in more depth about the modelling that has been done, rather than have Ms Clarkson go through all the work that she and her colleagues have done. As the committee is well aware, the Government committed to £0.5 billion of funding in the years during the run-up to 2021, and we will honour that commitment. As Ms Baillie and committee members know, Mr Mackay is willing to have budget discussions with every party. However, as he has clearly stated, if more spend in one area is suggested, there will have to be identification of where that money will come from.

You can be assured that I do everything possible to make sure that we get the best value for our current spend and that we have the most interventions that we can have in people’s homes to get them out of fuel poverty. We will send the committee the modelling stuff, and I am sure that Mr Mackay will be open to discussions with colleagues in the run-up to the budget, if that is what they want.

Liam McArthur (Orkney Islands) (LD)

I am not sure how much more progress we will make, because you have already stated that you are prepared to keep under review any issues around definitions. Particular concerns are being raised about the failure to include in the bill a remote rural MIS. Given that context, I will try to reinforce the argument about the MIS, which is a recommendation from the rural fuel poverty task force and the independent expert panel, whose view is shared by every organisation across the Highlands and Islands that has any involvement in seeking to address fuel poverty in that region, as well as by similar bodies in other parts of rural Scotland.

From what I have heard and read in the evidence that the committee has received, it is the overwhelming view of the witnesses who have given evidence that the bill needs to include a remote rural MIS. The concerns that you raised previously, minister, about the potential increases in cost and delay that would result from the inclusion of a remote rural MIS have been laid to rest by that evidence. On top of that, the concern that you have raised today about the potential exclusion of places such as Kirkwall, Stornoway and Lerwick has been addressed by Professor Hirsch, who told the committee that there is no reason why the bill should not include category 4 remote rural towns as well as category 6 remote rural settlements. His view is that the difference between disposable income in category 4 areas and disposable income in the rural communities surrounding those towns is marginal.

We are building up a picture that, in order to achieve its objectives and to ensure that it does not artificially affect levels of fuel poverty in rural and island areas, the bill must include a remote rural MIS. I do not expect you to accede to that argument just now. However, with all due respect, I ask you to reconsider your position on that issue ahead of stage 2 and, ideally, to lodge an amendment on it at stage 2.

Kevin Stewart

Convener, as Mr McArthur knows very well, I have had discussions with a huge number of folk about a lot of issues that affect remote rural and island communities. Indeed, I have seen Mr McArthur himself on a number of occasions. My door is always open. We took a view at the beginning that it would be too costly to develop a regional MIS and that it would take several years to do so. Frankly, like many others, I would rather spend money on interventions where that is at all possible.

Liam McArthur

Minister, that argument was put directly to the first panel that came before the committee and they refuted it. The cost would be marginal and the Government has already committed to changing its own definition, which will incur a cost.

Kevin Stewart

As I said in my opening remarks, the Argyll and Bute option deals with some of our cost concerns and also looks at other aspects. We will look at the proposal, and I will be more than willing to continue to talk to members about all issues that arise during the scrutiny of the bill. Mr McArthur knows that my door is open. We will do the work and will come back and let the committee know its outcome.

Liam McArthur

I welcome the islands impact assessment that you have committed to carrying out, but it will need to be as detailed as possible. It cannot be a desk-based exercise but will need to engage local authorities, housing associations and a range of stakeholders who have offered their views on the issue.

Kevin Stewart

As I said, that part of the Islands (Scotland) Act 2018 is not yet commenced, but, in the spirit of all of this, we agreed that we would undertake an islands impact assessment. Mr McArthur knows that I listen to the folk of Orkney, Shetland, the Western Isles and the other islands, including Arran and the Cumbraes—Mr Gibson would not have forgiven me if I had not mentioned them—in all that I do. We will ensure that the assessment is the right one.

The Convener

I thank everybody for their attendance today. I suspend the meeting briefly to allow our witnesses to change over for the next agenda item.

10:51 Meeting suspended.  11:00 On resuming—  
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21 November 2018

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5 December 2018

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19 December 2018

Committee Findings

Local Government and Communities Committee's Stage 1 report

This report was published on 29 January 2019.

Find out what else the Local Government and Communities Committee is doing.

 

What is secondary legislation?

Secondary legislation is sometimes called 'subordinate' or 'delegated' legislation. It can be used to:

  • bring a section or sections of a law that’s already been passed, into force
  • give details of how a law will be applied
  • make changes to the law without a new Act having to be passed

An Act is a Bill that’s been approved by Parliament and given Royal Assent (formally approved).

Delegated Powers and Law Reform Committee

This committee looks at the powers of this Bill to allow the Scottish Government or others to create 'secondary legislation' or regulations.

It met to discuss the Bill in public on:

26 February 2019:

Read the Stage 1 report by the Delegated Powers and Law Reform committee published on 28 November 2018.

Debate on the Bill

A debate for MSPs to discuss what the Fuel Poverty (Scotland) Bill aims to do and how it'll do it.

 

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Stage 1 debate transcript

The Deputy Presiding Officer (Linda Fabiani)

It is time to move on to the next item of business—when you are ready, Mr Simpson.

The next item of business is a stage 1 debate on motion S5M-15892, in the name of Kevin Stewart, on the Fuel Poverty (Target, Definition and Strategy) (Scotland) Bill.

15:03  
The Minister for Local Government, Housing and Planning (Kevin Stewart)

I am pleased to be opening the stage 1 debate on the Fuel Poverty (Target, Definition and Strategy) (Scotland) Bill. In this day and age, it is unacceptable that any Scottish household should have to make the choice between having the heating on and cooking dinner. If Scotland is to become a fairer and more socially just society, it is crucial that we make real headway towards ending the scourge of fuel poverty.

We are ambitious in our aims. Our groundbreaking bill places Scotland among the best countries in the world for tackling fuel poverty. Not only are we one of just a few countries in the world to have defined “fuel poverty”, but we are setting a goal for eradicating it. We are also changing our definition of fuel poverty so that it is much more reflective of relative income poverty, and we are being revolutionary through our introduction of a minimum income standard.

I thank the Local Government and Communities Committee for its detailed examination of the bill. I also thank the committee clerks, stakeholders, organisations and individuals who have contributed to the scrutiny process and engaged on the bill. I appreciate all their work to make the bill as good as it can be. I am, of course, pleased that the committee’s comprehensive report welcomes the bill and our draft fuel poverty strategy, as well as recommending that Parliament agree the general principles of the bill.

I turn to the bill’s three key aims. The first is to set the target

“that in the year 2040, no more than 5% of households in Scotland are in fuel poverty.”

The second aim is to capture, in the definition of fuel poverty, the folks who most need help, so we are proposing a new definition of fuel poverty that makes innovative use of the minimum income standard in order to better align fuel poverty with relative income poverty. Thirdly, the bill will ensure that a new long-term fuel poverty strategy will be prepared, published and laid before Parliament.

Crucially, the bill will ensure that in preparation of the strategy we will consult people with lived experience of fuel poverty in order to ensure that our key measures and polices hit the mark. I am very grateful to Ann Loughrey and the Scottish fuel poverty advisory panel and partnership forum for their help in that regard. Once the strategy has been published, ministers must report every five years on the steps that have been taken, on progress that has been made towards meeting the target, and on the plan for the next reporting period. That reporting obligation will provide this and future Governments with focus and momentum in the fight against fuel poverty.

The bill is the product of a thorough and collaborative process. In 2015, we set up two short-life independent bodies to report on fuel poverty: the fuel poverty strategic working group and the rural fuel poverty task force. Following on from their reports, an independent academic panel was tasked with reviewing the definition of fuel poverty. The majority of its recommendations have been incorporated in the definition of fuel poverty that is in the bill.

We also ran a fuel poverty strategy consultation prior to publishing a draft fuel poverty strategy alongside the bill, and we set up the fuel poverty advisory panel and partnership forum as part of a robust new framework for monitoring progress in tackling fuel poverty, and for advising the Government. My officials and I have engaged widely with stakeholders throughout the process, and Parliament can be assured that we will continue to do so. All that shows just how serious the Scottish Government is about tackling fuel poverty.

I have responded to the committee’s conclusions and recommendations, and have outlined the many with which I agree and where I will lodge amendments at stage 2. I take the opportunity to discuss some of those now.

I welcome the committee’s support of the bill’s major aim, which is

“the target ... that in ... 2040, no more than 5% of households in Scotland are in fuel poverty.”

I also confirm my intention to introduce two interim 2030 targets: that by 2030 the fuel poverty rate will be no more than 15 per cent and the median fuel poverty gap will be no more than £350 in 2015 prices, before adding inflation.

The Government’s ambition is simple: it is to put an end to all fuel poverty. We will not stop working until that happens. All the targets will go a long way towards ensuring that we address the severity of fuel poverty, as well as its prevalence. I therefore note the committee’s recommendation that we also include a target to tackle extreme fuel poverty. I am pleased to say that I have listened to the committee and will lodge a stage 2 amendment to define extreme fuel poverty and set a target for its eradication.

The committee expressed the view that the Government should consider lodging an amendment to apply the 5 per cent target for 2040 to all 32 of Scotland’s local authorities. However, although we are committed to helping folks out of fuel poverty no matter where in Scotland they live, I am keen to avoid setting some local authorities a goal that is unachievable and unrealistic. I have set out my views in detail in my response to the committee, but I am concerned that its proposal does not seem to be evidence led, and in particular that it has not been the subject of any consultation. I have therefore written to the Convention of Scottish Local Authorities to seek its views in detail. I note, in the meantime, that it has already written to the committee to express its concerns.

I welcome the committee’s support for our proposed use of the UK minimum income standard in the measurement of fuel poverty, which will improve the alignment between fuel poverty and income poverty. No one should underestimate how important and innovative that move is. More than 80 per cent of fuel-poor households are also income poor under the proposed new definition, compared with just over 60 per cent under the current definition. Households that might not be income poor, but which struggle nonetheless to pay their fuel bills and to maintain an acceptable standard of living, will also be captured by the new definition.

I understand the concerns that have been raised about the higher costs that are faced by people in remote rural areas, remote small towns and island communities. I have carefully considered the committee's recommendations and the views of stakeholders that the Government should commit to introducing an additional MIS for remote rural areas, remote small towns and islands in order to reflect those costs.

In recognition of the unique challenges that such areas face in the fight against fuel poverty, I will lodge an amendment at stage 2 to introduce an MIS uplift, as the committee has requested, for areas that form categories 4 and 6 of the Government's six-fold urban/rural classification. I am examining the options for how that can best be carried out, along with the costs involved, and I intend to write to the committee to seek its views before lodging amendments.

Liam McArthur (Orkney Islands) (LD)

I welcome what the minister says about a rural MIS. Does he accept that it is imperative that the uplift be introduced on a robust and independent basis, so the input of people such as Professor Hirsch of Loughborough University must play a part in development of the policy?

Kevin Stewart

I assure Mr McArthur that we have continued to speak to Professor Hirsch since he gave evidence and after publication of the stage 1 report, and that we will continue to do so. It would be wrong to introduce a policy that was not robust, so I will write to the committee, setting out the options and seeking its views, before I lodge stage 2 amendments. I thank Mr McArthur and others for continuing to engage with the Government during the process. We have had some robust exchanges and some very good ones. Long may that continue.

For our island communities, I emphasise that, in addition to our MIS commitment, we are conducting an islands impact assessment for the bill. The relevant provisions of the Islands (Scotland) Act 2018 are not yet in force, and the guidance for such assessments is still in development, but our assessment will be in the spirit of the act, in partnership and consultation with island communities and the six relevant local authorities.

The Government is alive to the calls from Mr McArthur, Alasdair Allan and others that the assessment should not be a desk-based exercise. I am firmly of the view that it is better for the Scottish Government to take the time to produce a comprehensive and detailed assessment in partnership with island communities. I previously committed to publish the assessment before stage 3. I confirm that that remains my intention: it will be published by the end of April.

I turn to reporting on fuel poverty. I am pragmatic and open to persuasion that reporting needs to be more frequent than every five years. That said, in order to avoid duplication and to promote co-ordination between complementary Government policies, I am keen to co-ordinate the timeframe for reporting on fuel poverty with the timeframes for reporting on energy efficiency and climate change.

I also want to ensure that fuel poverty reporting obligations do not place an undue burden on our local authority partners. I am aware that COSLA wrote to the committee to express its concern that that might be the case. I also share COSLA’s concern that there is potential for reporting obligations to detract from front-line delivery. I do not rule out lodging a stage 2 amendment to make the reporting obligation on fuel poverty more frequent, but I want to engage with COSLA further to understand its views and ensure that we have the appropriate balance between its views and those of the committee.

As members will now be aware, I have carefully considered the views of the committee and aim to lodge many of the amendments that it has recommended. However, I cannot agree with the committee on the suggestion that the Scottish fuel poverty advisory panel be made statutory. In terms of its composition and structure, the panel is not the same as the United Kingdom Committee on Climate Change. It is key that the panel remains flexible and adaptable. To maintain its role over the intended lifetime of our proposed fuel poverty act, the panel’s membership and remit must keep pace with the changing landscape of fuel poverty, potential new technologies and opportunities, and future partnerships.

I also share COSLA’s concern that the creation of a statutory body would risk diverting funding away from the core objective of supporting households out of fuel poverty. I am sure that nobody wants that. I am strongly of the view that Parliament can provide the scrutiny that is required to ensure that this and future Governments keep on track on the objectives that we all share.

I am grateful that we have the opportunity to discuss the aims of the Fuel Poverty (Target, Definition and Strategy) (Scotland) Bill this afternoon, and I look forward to hearing members’ views.

I move,

That the Parliament agrees to the general principles of the Fuel Poverty (Target, Definition and Strategy) (Scotland) Bill.

15:17  
James Dornan (Glasgow Cathcart) (SNP)

I am pleased to open the stage 1 debate on the Fuel Poverty (Target, Definition and Strategy) (Scotland) Bill on behalf of the Local Government and Communities Committee. I thank the minister for responding to our report last week in time for today’s debate.

As the minister stated, the bill primarily sets a target to reduce fuel poverty to no more than 5 per cent of Scottish households by 2040, sets a new definition of fuel poverty, requires the Government to bring forward a strategy to meet the target and puts in place reporting requirements. [Interruption.]

The Deputy Presiding Officer

Excuse me, Mr Dornan—could you move your mic over a little bit? We really want to hear you.

James Dornan

My apologies, Presiding Officer.

Recent statistics show that fuel poverty affects 24.9 per cent of households in Scotland, with some individuals and families struggling to pay their fuel bills or heat their homes to an acceptable and comfortable level. Living in a cold, draughty home can have a negative impact on people’s physical health and mental wellbeing and can impact children’s attainment. No person should have to choose between heating their home or eating. Therefore, it is disappointing that so many households remain in fuel poverty, despite efforts by previous Administrations to tackle the issue.

The bill before us has been informed by such efforts. Most recently, a target that was set by the Labour-Liberal Democrat Scottish Executive in 2002 for people to not be living in fuel poverty by November 2016 was not met. Following a number of independent reviews and consultations led by the Scottish Government, a new definition of fuel poverty was strongly recommended—one that would more accurately identify those in financial distress in order to better target resources at those in greatest need. I will come back to the definition later in my speech.

The Local Government and Communities Committee was appointed as the lead committee for scrutiny of the bill on 5 September 2018. We received 67 written responses to our call for views, which closed on 9 November 2018. We heavily promoted our scrutiny of the bill on social media and held a number of oral evidence sessions with expert stakeholders. In addition to taking oral evidence, some committee members travelled to Dundee and the Western Isles to hear directly about the different experiences of those who face fuel poverty in urban and rural communities. In doing so, we heard about the particular challenges that are faced by those who live on our islands. I thank all those who provided written and oral evidence and all those who engaged with us during our scrutiny.

I turn to some of our key recommendations. Section 1 of the bill puts in place a new target for less than 5 per cent of households in Scotland being in fuel poverty by 2040. Although there was some debate around whether the target threshold should be set lower than 5 per cent, we agreed that that target is achievable and strikes the right balance between realism and ambition, recognising that the Scottish Government has little or no influence over two of the four main drivers of fuel poverty. However, we acknowledge that the 5 per cent target should not limit the ambition of future Governments and that the longer-term focus should be on eradicating fuel poverty.

There was also some debate around whether the target’s end date should be brought forward from 2040. Given that reaching the target will rely on technologies that are still in development, the committee came to the view that it is realistic to build in time for those to come on stream.

It is also encouraging that the Government has agreed to our recommendation to amend the bill to enshrine in statue the interim targets that are currently set out in the draft strategy that accompanies the bill. Specifically, those targets are that, by 2030, the fuel poverty rate will be no more than 15 per cent and the median fuel poverty gap will be no more than £350 at 2015 prices. It is hoped that such measures will help to prevent drift from reaching the target.

To prevent resources from being targeted at low-hanging fruit—the easiest-to-treat properties—we called on the Scottish Government to bring forward a separate target to tackle extreme poverty. Extreme poverty has previously been categorised as encompassing households that have to spend 20 per cent of their income on fuel. It is therefore welcome that the minister has committed to bring forward proposals for a separate target to tackle extreme poverty at stage 2.

I also note that the Government will give further consideration to the committee’s suggestion that local targets be applied to address regional disparities. I look forward to receiving an update from the minister on the outcome of the Government’s consultation with COSLA on the committee’s proposals.

To more closely align fuel poverty with income poverty, section 2 puts in place a new definition that assesses whether a household is in fuel poverty following the deduction of housing costs, such as rent, mortgage, council tax and water rates, as well as childcare costs. It uses an income threshold measure known as the minimum income standard—MIS—to determine an acceptable standard of living. That was deemed necessary given that, under the existing definition, a number of households that were considered to be fuel poor were not actually facing financial distress.

The greater alignment between fuel poverty and income is welcome, as it will provide a more accurate picture of those who experience fuel poverty. However, many people expressed concerns that the new definition does not accurately capture those who face fuel poverty in our island and remote rural communities. We therefore called on the Scottish Government to bring forward an additional rural MIS to recognise the higher costs that are faced by those communities. It is welcome that the Government has accepted that recommendation, and we look forward to liaising with the minister on that important change in the lead-up to stage 2. It is also encouraging that the Government will carry out an islands impact assessment of the bill and the associated strategy.

We heard concerns that the complexity of the new definition could hinder the delivery of services on the ground. We therefore called for more information on the minister’s thinking around the development of a doorstep tool and on how proxies will be used alongside the new definition to better identify those who are in fuel poverty. It is helpful to have received clarification from the minister that the use of proxies will continue and that the Government, alongside COSLA, will further consider what tools and guidance are necessary for councils to target resources at those in the greatest need.

Sections 3 to 5 require the Scottish Government to prepare a fuel poverty strategy that sets out how the 2040 target will be achieved. They also set out the consultation, publication and laying requirements for the strategy. The committee agreed with those proposals, particularly the requirement to involve people with lived experience of fuel poverty. At the same time, however, we agree with our witnesses that it should be a collaborative, and not a top-down, process.

I turn to the contents of the draft fuel poverty strategy, which was published alongside the bill. It is welcome that the minister will listen to the views of our stakeholders on suggested improvements as part of on-going engagement with them. I was particularly encouraged that the minister will look to improve the strategy in relation to the list of issues that are highlighted in paragraph 199 of our report, which include how fuel poverty will be tackled in the private housing sector and our rural and island communities, and the actions that the Scottish Government will take to address all four drivers of fuel poverty, including those that are primarily the responsibility of the UK Government.

As our report sets out, we have written to the UK Government regarding problems that have been caused to people’s houses by works that were carried out under UK-based energy efficiency schemes. We heard of serious misgivings about the administration of some of those schemes, and it is encouraging that the Scottish Government is also pursuing that matter with the UK Government.

Kevin Stewart

I am very grateful to the committee for looking at the situation with the UK schemes. As Mr Dornan has pointed out, the Scottish Government has been on to the UK Government on a number of occasions about trying to deal with some of the real difficulties that have been caused. I am very grateful to the committee for its efforts in joining the Scottish Government to try to seek a resolution, and I would appreciate our continuing to liaise on the matter. We must do all that we can to get the UK Government to see sense on those folk who are suffering because of Home Energy and Lifestyle Management and others.

James Dornan

I assure the minister that the committee will be happy to liaise with him regarding those letters.

The bill requires the Scottish ministers to lay periodic reports on the progress that has been made towards reaching the 2040 target alongside the steps that will be taken in the next reporting period to meet the target. It is welcome that the Government will report on progress in relation to all four drivers of fuel poverty. The bill currently provides that those reports should be laid every five years but, given the concerns that have been raised, we have recommended that they be laid every three years. The vast majority of those from whom we heard called for more frequent reporting. I note that the Government will consult COSLA on the viability of increasing the frequency of reporting, and I look forward to an update in due course.

It is disappointing that the Government has not accepted our recommendation to put the Scottish fuel poverty advisory panel on a statutory footing to provide an independent scrutiny role. However, the minister has provided the committee with clear reasons as to why that recommendation has not been accepted.

As the minister has noted, the Parliament will no doubt pay close attention to the Government’s progress towards meeting the target as well as to the steps that it will take as the new technologies that are required in the fight against fuel poverty are developed.

I put on record my thanks to the committee clerks and officials in the Scottish Parliament information centre for all their assistance during the stage 1 process, and to everybody who gave evidence in person or in writing.

The bill has the potential to make a difference to the lives of many families in Scotland, but the real test will be whether the measures and strategies that accompany it are practical, deliverable and robust. It will be the job of the Parliament to keep a watch on that in the coming years.

The committee commends the bill to the Parliament and recommends that the Parliament agrees to its general principles.

15:28  
Graham Simpson (Central Scotland) (Con)

The Fuel Poverty (Target, Definition and Strategy) (Scotland) Bill should have been an exciting and far-reaching piece of legislation, but it is anything but that. However, it can change. The six pages of the bill could be replaced with a six-line press release and the same thing could be achieved.

In 2016, the Scottish National Party made a manifesto pledge to introduce a warm homes bill. In November 2017, the Scottish Government said:

“Eradicating fuel poverty is crucial to making Scotland fairer and that is why we are proposing that the key purpose of the Warm Homes Bill will be to enshrine in legislation our long term ambition to eradicate fuel poverty.”

Here we are in 2019 with a fuel poverty bill—not a warm homes bill—that does not set a target to eradicate fuel poverty. The bill even states its purpose to be

“An Act of the Scottish Parliament to set a target relating to the eradication of fuel poverty”.

Its purpose is not to set a target for the eradication of fuel poverty—which would have meant something—but

“to set a target relating to the eradication of fuel poverty”.

That is a far cry from the words that were issued by the Scottish Government in 2017. The bill is well meaning, but it lacks ambition.

First, the bill sets a new definition of fuel poverty. It says that, once a household has paid for its housing, it is in fuel poverty if it needs more than 10 per cent of its remaining income to pay for its energy needs and that leaves the household in poverty. That seems fair enough.

The bill sets a target of reducing the rate of fuel poverty to 5 per cent within—wait for it—21 years.

Kenneth Gibson (Cunninghame North) (SNP)

I am quite surprised by the tone of the speech so far. My understanding was that there was more or less consensus in the committee, and I do not remember you or any other colleague dissenting on any of the specifics, including the 2040 date, when we put the report together.

The Deputy Presiding Officer

Always address members through the chair, please.

Graham Simpson

Mr Gibson is well aware of how committee reports are put together. Members are entitled to give an alternative opinion in debates such as this one.

Who will be accountable at that date in 21 years’ time? By then, Ruth Davidson could be in her fourth term as First Minister, and her son could have graduated, but I cannot see most of us being here. Given that the target date is so far into the distance, the Local Government and Communities Committee was entirely right to suggest statutory interim milestones, which could prevent ministers from wriggling off the hook along the way. I tend towards the view, which was expressed by the Existing Homes Alliance Scotland, that the bill should be amended to ensure that corrective action is taken if targets are not met.

Kevin Stewart

Will the member give way?

Graham Simpson

I will not on this occasion.

If the bill is not amended, all that we will get is a Government shrug of the shoulders and, quite possibly, an attempt to blame someone else. That said, I am still carefully considering whether to lodge an amendment that would move the target date forward.

As we have heard, the committee did some sterling work. We visited Dundee and Stornoway. In Dundee, we heard about the problems that people who use prepayment meters have if they want to switch providers. We saw how area-based schemes can successfully lift people out of fuel poverty and help their health at the same time.

In Stornoway, one of the bill’s serious omissions was brought home to us. When the minimum income standard is used, there is a refusal to define fuel poverty in a way that reflects the higher costs that are incurred by people who live on islands or in remote and rural areas.

Kevin Stewart

Will the member give way?

Graham Simpson

No, because I am about to praise the minister for agreeing to amend the bill to reflect the committee’s view on that matter. Fuel poverty rates in urban Scotland have improved since 2015, but rates in rural areas have not improved, so there is a widening gap. We have a legislative vacuum that simply must be filled at stage 2, and a number of stakeholders agree.

The committee heard of contractors carrying out substandard work under UK Government-funded schemes and of lax monitoring. I have heard of such activity taking place before, and it does not interest me one bit which Government is to blame, if that is the right word. I insisted that we mention that issue in the committee’s report and, as he said, the convener has written to the Minister of State for Energy and Clean Growth, Claire Perry, about it.

Much has been made of the target to reduce the rate of fuel poverty to 5 per cent. A number of groups, including Energy Action Scotland, believe that the target is not ambitious enough. As SPICe has said, that could mean that 140,000 households will still live in fuel poverty—which is 140,000 too many. However, it will never be possible to completely eradicate fuel poverty. People will move in and out of fuel poverty as their circumstances change and, of course, it is not possible to know about everybody’s circumstances.

One thing that the committee said that has caused some push-back is that reducing the rate of fuel poverty to 5 per cent should be achieved in every council area. COSLA did not like that, and nor did the minister, as he said earlier. However, the reason behind that suggestion was to ensure that no area slips through the net. I accept that more work will need to be done on that matter.

The bill commits ministers to preparing a fuel poverty strategy. Helpfully, the Government produced a draft strategy in which the minister describes the bill as a “landmark piece of legislation”. One of the best ways of reducing fuel poverty is to ensure that homes are as energy efficient as possible. The strategy says:

“all domestic properties are required to achieve an Energy Performance Certificate ... rating of at least EPC C by 2040 at the latest.”

The strategy does not say how that will come about. It does not recognise the very real concerns about the accuracy—or lack of it—of using EPCs, nor does it say anything about real action on making new and refurbished homes as near to the Passivhaus standard as possible. I have repeatedly pushed the minister on this issue, but it is now time for action.

There was much disappointment when the bill was published, and there will be a clamour to amend it. Indeed, Opposition members are already being sent suggestions for amendments. I hope that the minister has learned from his bitter experience with the Planning (Scotland) Bill that he should be engaging with us in detail right now—

Kevin Stewart

Mr Simpson well knows that I will engage with anyone and everyone, and I have done so throughout the passage of this bill, as I have with others. Some members take the opportunity to speak to me, stakeholders always have that opportunity, and some of the reasoning behind the changes that will be made in stage 2 amendments has emerged from those discussions. I do not appreciate Mr Simpson’s insinuation that there has been no discussion on this matter, given that I met him and Alexander Stewart in the very early stages of the process and will do so again if there is such a request.

Graham Simpson

I think that the minister has learned his lesson, because he has had a discussion with me and Mr Stewart, he has responded well to the committee’s report, and he has said that he will lodge very helpful amendments. It would be in nobody’s interest not to move forward along those lines.

We, on the Conservative benches, are pretty underwhelmed by the bill. However, we think that it can be improved, and we will support it at stage 1.

15:36  
Pauline McNeill (Glasgow) (Lab)

I thank the Local Government and Communities Committee for a lengthy but excellent piece of work. I must confess that I did not read all of it, but I know that the committee went into real detail in its work.

I wonder whether Ruth Davidson is watching the Parliament on her maternity leave—who knows?—and I also have to wonder what she thought about Graham Simpson committing her to another four terms in this place. I have to say that the rest of us are slightly alarmed by that commitment.

Like everyone else, I believe that every Scot has the right to live in a warm, affordable and secure home. Unfortunately, we are a long way from that reality, with just over a quarter of households living in fuel poverty. The energy watchdog, the Office of Gas and Electricity Markets, recently announced an increase in the cap on the default tariff, which most people are on, and as those who saw that announcement will know, it means that, on 1 April, more than 1 million households in Scotland will be looking at an average rise of £110 a year. It is a really important point; the vast majority of people—even those who should know better that cheaper deals are available—are on default tariffs. Ofgem is the organisation that is meant to be protecting the consumer, but uSwitch has warned that larger families in Scotland could see their annual bills rise by up to £184 a year, and Age Scotland has responded to the increase in the cap by saying that it will do nothing to tackle fuel poverty and, indeed,

“makes a mockery of the term ‘cap’”.

Kevin Stewart

I agree completely and utterly with Ms McNeill. It is a great pity that, as far as the drivers of fuel poverty are concerned, this Parliament has no control over fuel prices or income. Between 2003-04 and 2017, the median household income in Scotland rose by 50 per cent while at the same time fuel prices rose by 158 per cent. I am grateful that a cap is in place, but it does not go far enough. I believe that this Parliament should have control over that, and I hope that Ms McNeill will consider supporting us in that regard.

Pauline McNeill

I am on record as saying that someone should certainly have control over the matter, and it is certainly something that I am willing to discuss. Not even the Westminster Parliament has control over energy prices.

That said, I am sure that the minister takes the most relevant point: more people are going to be living in fuel poverty as energy prices begin to rise. We can encourage people to switch to cheaper tariffs, but recent research by the consumer organisation Which? indicates that energy companies have dramatically reduced the number of cheaper deals that are available. Price is just one factor in all of this, but reducing the number of cheaper deals will mean that less cheaper fuel is available.

Like Graham Simpson, I do not see this bill as groundbreaking or revolutionary, but I think that we can get there by stage 3.

Labour welcomes the introduction of the bill, but we think that it falls short in many areas. It is narrowly drawn, which is a huge mistake. The Existing Homes Alliance Scotland has said:

“we have a once in a lifetime opportunity to tackle it and we must take it. We want to eradicate fuel poverty for good.”

I know that we all want that. I welcome what the minister said on the forthcoming amendments to the bill on interim targets and extreme fuel poverty. We wholly welcome that. However, I believe that the delivery section of the bill should reflect more of the format of the Child Poverty (Scotland) Act 2017 by setting out areas where we can begin to improve. In the case of the bill, that would be improving energy efficiency to reduce householders’ energy costs. How else are we to achieve the targets? It has to sound more like a real ambition to prevent more people from living in cold and draughty homes. We need to know how the Scottish Government intends to achieve that.

We need delivery of help for poorer households. Citizens Advice Scotland has said that those who find it most difficult to afford their energy bills are less likely to have access to support. Ministers should be having discussions with the big six suppliers and others about improving emergency credit schemes and helping their most vulnerable customers—I see the minister nodding.

There is a lot of work to be done in the area. One of the most concerning issues is that, with yet another price hike, even more customers are struggling to pay their bills, particularly those who are already vulnerable. Ofgem is consulting on its consumer vulnerability strategy, and it is important that we see more standardisation across the sector. Energy companies are supposed to have a priority services register, but there are currently no standard qualifying criteria for vulnerable households to be placed on the register. More than ever, we need to find a way to ensure that companies take vulnerable customers off standard variable tariffs and place them on a more favourable deal. Simply through discussion, more could be done to force companies to do that.

Kevin Stewart

Will the member give way on that point?

Pauline McNeill

Very quickly—I do not want a long intervention like the last one.

The Deputy Presiding Officer

You got there before I did, Ms McNeill.

Kevin Stewart

The Government has engaged with the big six suppliers and others on the issue. I would welcome cross-party support from across the Parliament so that we can act together to put pressure on those companies to see sense in that regard.

The Deputy Presiding Officer

I can give you a little extra time, Ms McNeill.

Pauline McNeill

The minister will definitely have our support on that.

I want to say a little about rural communities, although that has been well covered by Graham Simpson and James Dornan. More than two fifths of Scots live in rural areas, and huge numbers of them are estimated to be suffering from fuel poverty. It is clear that an adjustment needs to be made to the definition of fuel poverty. I heard what the minister said on that, although we need to see the detail. That is to be particularly welcomed for people in rural communities, because it is clear that it is much harder for them to reduce their energy costs when they do not have the same access to the national grid. We also need to consider lifting the level of the warm homes discount for households in rural areas, to recognise the high levels of fuel poverty there.

Graham Simpson has spoken many times about the private rented sector, and I add my voice to his on that. Private renters are more likely to live in a house that requires critical and urgent repair and that does not meet the Scottish housing quality standard, which often means living in a home with insufficient insulation. People who live in the private rented sector are twice as likely to live in homes in the lowest EPC bands, and the rates of fuel poverty in the sector are above the national average. In the delivery plan, we need to focus on the private sector to see what action can be taken to lift those households out of poverty.

Furthermore, we need to make it easier for home owners who might be able to pay a bit towards home energy efficiency measures to get Government support. I confess that I find the myriad of loans and grants under the schemes complicated to follow—I have studied them—so goodness knows what householders make of it. We need to do more to give people confidence to apply to what I believe are very good schemes. I call on the Scottish Government to advertise its zero interest rate loan scheme and review how more people could be helped. I think that more people are able to pay and, with Government support, might be prepared to make the jump and make their houses more fuel efficient.

We must eradicate fuel poverty once and for all. We must be ambitious for the fuel poor. We are only at stage 1, and I believe that, by stage 3, with a consensus, we can achieve that.

15:44  
Andy Wightman (Lothian) (Green)

As other members have done, I thank my Local Government and Communities Committee colleagues, the clerks, SPICe and everyone who gave evidence. I also thank the many groups who submitted briefings for today’s debate.

As the minister did, I pay tribute to the Scottish fuel poverty strategic working group and the Scottish rural fuel poverty task force, which were chaired, respectively, by David Sigsworth and Di Alexander, whose work contributed so much to the bill.

We know the statistics from the Scottish house condition survey. A quarter of households are living in fuel poverty and about 7 per cent of households are living in extreme fuel poverty. That is unacceptable and we need to tackle the issue.

Although I welcome the Scottish Government’s response to the committee’s report, which says that if we reach the target, Scotland will be

“amongst the very best in the world in terms of tackling fuel poverty”,

it is clear to me that we have an awful lot of work to do if we are to achieve that ambition. I will set out the Greens’ position and talk about where we will seek to make changes at stage 2.

It is worth noting that a bill that focuses on targets, definitions and strategies takes us only so far. A number of members have mentioned the promise of a warm homes bill. Such an approach has been abandoned, and instead we have targets, definitions and strategies. Delivery against a target will require us to integrate policies around climate change, the built environment, energy, health and so on. I welcome the minister’s commitment to align some reporting in that regard, which would be helpful.

The committee deliberated at length on the target, which was the focus of much evidence. In light of the failure to achieve the previous target, which was set in 2002, it is right that we take a more critical and sceptical view this time round. We welcome the commitment to interim statutory targets, but the 2040 target has been criticised for not being ambitious enough. The committee took the view that the target is okay, because it is pragmatic. However, with enhanced reporting and scrutiny, there should be the ability to consider whether progress can be made more quickly over the coming years. A 2032 target reflects the higher ambition and is preferable. If it cannot be achieved, we will know in advance.

Annabelle Ewing (Cowdenbeath) (SNP)

The member will remember an issue that was raised in the committee with regard to an earlier target, which was that emerging technologies need time to be developed, to become available at a reasonable price to individuals in Scotland and to bed in. Are those factors in this debate?

Andy Wightman

I agree entirely that emerging technologies will be critical. They might be slow to arrive; they might be faster. We should not make predictions about how fast they might arrive.

There is an issue with the wording in the bill. The long title refers to the setting of

“a target relating to the eradication of fuel poverty”,

but given that the intention is to reduce the rate to 5 per cent, we should be more honest and say that the bill sets a target relating to the reduction of fuel poverty.

There has been a lot of talk about the four drivers of fuel poverty—the cost of energy, energy efficiency, household income and household behaviours—and how in Scotland we are in control only of energy efficiency and household behaviours.

In its response to the committee’s report, the Scottish Government said that it has “significant control” over only one of the four drivers, that is, home energy efficiency. The minister repeated that in an intervention during Pauline McNeill’s speech.

I disagree with that contention. The bill makes it clear that the definition of fuel poverty is based on a minimum income standard. Gross incomes are not within the significant control of the Scottish Parliament, the Scottish Government or indeed the UK Parliament, but the definition of fuel poverty uses not gross but net incomes—that is, incomes after housing costs, fuel costs, childcare costs, council tax and income tax.

All those things are within the direct influence of devolved powers. We can enhance people’s net incomes by reducing housing costs, reducing taxation, enhancing childcare provision and so on. My view is, therefore, that the Scottish Government has significant control over that area; it has the power to adjust income tax levels to ensure that the most vulnerable are not driven into fuel poverty in the first place.

Annabelle Ewing

What about national insurance? This Parliament—sadly—does not have control over that.

Andy Wightman

That is absolutely true. I am not arguing that the Parliament has complete control over net income; I am arguing that it has substantial control over people’s net incomes.

Another aspect of the bill that has been much commented on is the question of minimum income standard uplifts for remote and rural Scotland. I welcome the minister’s commitment to look at options in that area and, in particular, to consult the committee in advance of stage 2. That is a very productive way to proceed, and I hope that it will improve the bill.

Finally, I want to say a few words about scrutiny. Other members who have been in Parliament for longer than I have—I am looking at Jackie Baillie, among others—will have views on why the 2002 target was not met by 2016; for example, we know that rising fuel prices contributed. Failure to meet this target is also a possibility, for all sorts of reasons that we do not know about at the moment. The critical thing is to keep the target under review. Section 6 of the bill makes provision for reporting, but reporting is not scrutiny, especially when reports are laid by Scottish ministers who themselves have substantial responsibility for delivering.

It has already been mentioned that other legislation that enshrines targets, such as the Climate Change (Scotland) Act 2009 and the Child Poverty (Scotland) Act 2017, embed independent, statutory scrutiny mechanisms. The committee recommends such mechanisms in paragraph 219 of its report and I am disappointed that the Scottish ministers do not accept it.

I am not precious about how such independent scrutiny is achieved. The suggestion from the committee that the fuel poverty advisory group be placed on a statutory footing might be one option, but there are others. However, it is critical to have independent monitoring and scrutiny, because it is really important for the public to be able to assess whether progress has been made and whether it could be made faster or slower in response to emerging technologies. I do not think that the Parliament alone can do that job of scrutiny.

To conclude, the bill represents an important approach to tackling fuel poverty, but it is not in a fit state to deliver what is required. I look forward to working with other members and to engaging with ministers at stage 2.

15:51  
Liam McArthur (Orkney Islands) (LD)

I thank James Dornan and his committee for the report and for enabling me to play my part in stage 1 scrutiny of this important bill.

I am grateful to all those who gave oral and written evidence, which I found invaluable, not least in shining a light on ways to improve and strengthen the current bill and in giving greater urgency and ambition to our collective efforts to tackle a problem that blights too many households in too many communities across the country.

It will be a surprise to nobody that I intend to focus my remarks on how we might use the bill to address more effectively the issue as it affects rural and island areas—a theme to which Kenneth Gibson and I gave a good and regular airing at committee.

First, it is worth reflecting on why this bill matters so much and why it is essential that we show more ambition in what we are seeking to achieve. As the Existing Homes Alliance Scotland reminds us, the benefits of reducing fuel poverty go far beyond simply removing the need for people to choose between heating their home or eating a meal. All the evidence shows that lifting people out of fuel poverty helps to improve their physical and mental health. Unsurprisingly, living in a warm and dry home also helps to increase educational attainment. Local jobs are created and skills are enhanced in the energy efficiency and low-carbon heat industries, while households have greater energy security and money to spend. Our ambitions for tackling climate change rely on us making progress on improving the energy efficiency of our housing stock. For all those reasons and more, the bill matters.

It matters, of course, to communities throughout Scotland; few, if any, are immune from fuel poverty. That said, rural and island areas are disproportionately affected, with Orkney suffering the dubious honour of having the highest proportion of households in fuel poverty and extreme fuel poverty in Scotland. It is an honour that we are keen to relinquish, but it underscores the particular importance of the bill and the fuel poverty strategy, and the need to recognise and take specific steps to address fuel poverty in remote, rural and island communities.

Although the change in definition contained in the bill makes sense, as things stand the bill does not adequately take into account the additional costs associated with living in remote and rural areas of Scotland. Indeed, the bill ignores key recommendations from the Government’s own rural fuel poverty task force, ably chaired by Di Alexander, whose evidence to the committee on the matter was compelling. He set out in clear and cogent terms the rationale for using a separate minimum income standard for remote rural and island areas that reflects the additional costs that are borne by those living in such communities. It was a view shared by most of those who gave evidence to the committee on that part of the bill, and also universally supported by every council, housing association and fuel poverty group in the Highlands and Islands. The case is unanswerable, and I welcome the fact that the committee recognised that. I also welcome the minister’s willingness in recent months to engage with me and others in a bid to find a solution.

The minister’s commitment to undertaking an islands impact assessment is welcome in relation to not only this bill but, I hope, the future strategy as well. I welcome, too, his commitment to an appropriate uplift for rural and island areas. I look forward to seeing the detail of that, and I agree with Di Alexander that there is a strong case for two separate uplifts, reflecting the additional costs that are associated with living on an island. He is also right in saying that we must find a robust, independent way of assessing the appropriate level of uplift now and into the future. Professor Hirsch and the team at Loughborough University seem to be key to achieving that, but that must be enshrined in legislation, and I look forward to seeing what work can be progressed in that area at stage 2.

Review and redesign of fuel poverty proxies, which tend to be urban oriented, are also needed and should be independent of Government. In the meantime, it is encouraging to see a consensus around the need to distinguish between fuel poverty and extreme fuel poverty. Despite the best intentions of successive Administrations, there has been a collective failure to make a meaningful impact on behalf of those in most need. That must change, and I support the call for a separate target for eliminating extreme fuel poverty by 2024.

On targets generally, there are concerns about what is seen as a lack of ambition in the bill. Energy Action Scotland suggests that the 2040 date is

“effectively a whole generation away, and feels like ‘out of sight, out of mind’”.

The Existing Homes Alliance Scotland also points out that reducing fuel poverty from 24 per cent today to 5 per cent by 2040 represents a reduction of around 1 per cent a year. That hardly feels like the level of ambition that we should be showing, and it would potentially condemn 140,000 households to remaining in fuel poverty until 2040. So, again, I support calls to bring forward the deadline, if not to 2032, then certainly to earlier than 2040.

In addition, the proposal for statutory interim targets makes sense, as do calls for changes to the household condition survey, which will give us early indications of where the strategy is and is not working, so that we can make changes.

I welcome the committee’s call to see steps taken to ensure that progress is made by every local authority in Scotland. Although it might be impossible to ensure an entirely even rate of progress across the board, we cannot target investment and effort at areas with larger populations in a bid to hit the numbers rather than at communities where the need is greater.

Kevin Stewart

Will the member take an intervention?

The Deputy Presiding Officer

Extremely quickly.

Kevin Stewart

Mr McArthur already knows that we spend three times more per head of population in the islands than we do in mainland authorities. That is something that the Government has continued to do, recognising the differences that exist. It is—

The Deputy Presiding Officer

“Extremely quickly” means quickly, minister.

Kevin Stewart

It is wrong simply to focus on that urban element.

Liam McArthur

I do not dispute the fact that additional investment is made but, in a sense, the levels of fuel poverty need to be brought down across the board and consistently, and the expectations of people in island and rural areas are every bit as legitimate as those of people living in urban areas.

I see no good reason why the advisory panel should not be put on a statutory basis, ensuring robust, independent and effective advice to ministers and the wider policy-making process.

Although this bill is narrower in scope than the warm homes bill that was originally promised, it has the potential to make a real difference to the lives of people across this country. As Parliament embarks on stage 2 consideration of the bill, we should resist the temptation to play safe, to build in wiggle room or to keep kicking the can down the road. We have an opportunity to be ambitious, to be bold and to eradicate the scourge of fuel poverty in this country. I look forward to working with the minister and colleagues across the chamber to that end, and we will support the bill at decision time this evening.

The Deputy Presiding Officer

We move to the open debate. You might have noticed that there have been a lot of interventions, some of them quite lengthy. That means that I have no spare time left, so I ask for speeches of six minutes.

15:58  
Annabelle Ewing (Cowdenbeath) (SNP)

I am pleased to have been called to speak, not least as I have the pleasure of being a member of the Local Government and Communities Committee, which recently completed its scrutiny of the bill at stage 1.

At the outset, I remind everyone that Scotland is an energy-rich nation, yet we still see many of our citizens living in fuel poverty. That is as unacceptable as it is absurd. However, I note that, in terms of Government interventions, two of the key drivers of fuel poverty—energy prices and household incomes—fall broadly within the powers of the Westminster Parliament, not our Scottish Parliament, which is a situation that the unionist parties are, sadly, content to see continue.

Andy Wightman

Does Annabelle Ewing accept that the minimum income standard relates to net incomes and, while everyone’s income differs, the difference between gross and net incomes is considerable and could be substantially affected by devolved powers?

Annabelle Ewing

I hear what Mr Wightman says, but as I said in an intervention, national insurance, for example, does not fall within the jurisdiction of this place and this Parliament has control over only 15 per cent of the total expenditure on social security—to name but two issues. I think that Mr Wightman would accept that this Parliament does not have all the economic levers that impact on individual household incomes. Nonetheless, we are determined to place Scotland among the best in the world in seeking to tackle fuel poverty. To secure that laudable and ambitious objective, the bill sets forth both a target for the reduction of fuel poverty and an expressed definition of fuel poverty. In that respect, it is worth noting that

“Scotland is one of only a handful of European countries”

to define fuel poverty.

As we have heard, the target is to reduce fuel poverty to no more than 5 per cent of households in Scotland by 2040. As the convener said, the committee considered that the 5 per cent target struck

“an appropriate balance between realism and ambition”

and in so doing, it recognised both the limited powers of the devolution settlement and the fact that individual households move in and out of fuel poverty as a result of changing circumstances.

However, I do welcome—in his response to the committee’s stage 1 report—the minister’s recognition of the need to work in the long term for

“the eradication of fuel poverty”

to the extent that that “is realistically possible”.

As regards the period within which the target is to be achieved, it is worth noting, as has been mentioned, that there were differing views from those who gave evidence to the committee. While some people favoured the 2040 date, recognising, among other things—as I said in an intervention—that achieving the target will rely on emerging technologies that are still in development, others took the view that the time period was too long. That now seems to include the secret views of fellow committee member Mr Simpson. Therefore, it is to be welcomed that the minister has responded favourably to the committee’s concerns and has agreed to introduce amendments at stage 2 to put interim targets in the bill. As the minister said, those will be that, by 2030, the fuel poverty rate is to be no more than 15 per cent and the median fuel poverty gap is to be no more than £350 in 2015 prices, before inflation.

The revised definition of fuel poverty, based around the minimum income standard, that is set out in the bill was broadly welcomed, with the key discussions concerning the introduction of an uplift to the MIS to reflect the higher costs for those living on islands, in remote small towns and remote rural areas. I am pleased that the minister also listened to the committee on that important point and has confirmed that options as to how to achieve that objective are being considered. That is also the case with regard to the committee’s calls to set a separate target for tackling extreme fuel poverty, which is defined as spending more than 20 per cent of one’s income on fuel.

Given the position of many of my constituents in Cowdenbeath, I am also pleased to note that, although the age vulnerability threshold has been raised from 60 years of age to 75, nonetheless, those with disabilities and long-term illnesses will be recognised as needing enhanced heating. That recognition will capture a significant number of those in the 60 to 75 age cohort.

A draft fuel strategy has been published alongside the bill and, at this stage, is a work in progress. It is important that the Government proceeds to develop the strategy with the fullest engagement, not just with representative organisations, but with individuals who have experience of living in fuel poverty. That would ensure that the pivotal role that the fuel strategy will play in delivery can be secured.

In closing my remarks, it is important to recall that this is a framework bill and must be seen in the context of the suite of measures concerning energy efficiency and carbon emissions reductions that are planned or are in the pipeline. Working across portfolios is the only way to tackle both fuel poverty and climate change and to ensure that people can heat their homes affordably and with low-carbon heating technologies.

With the bill, we have an opportunity to reset the agenda and to make a real difference to the lives of not just my constituents in Cowdenbeath, but citizens around Scotland.

I am pleased to support the Fuel Poverty (Target, Definition and Strategy) (Scotland) Bill.

16:04  
Alexander Burnett (Aberdeenshire West) (Con)

I remind members of my entry in the register of members’ interests in relation to energy efficiency. As my colleague Graham Simpson noted in his opening speech, this is an important bill for Scotland, but in its current form it fails to outline how the Scottish Government will be held accountable if it does not meet the target.

Scotland has always been a country with great ambition, but right now the SNP Government is failing us with these targets. We are not alone in our thinking that the bill’s focus is too narrow. The Existing Homes Alliance Scotland said that the scope should be widened to help to improve energy efficiency and to support the achievement of warm, affordable, low-carbon homes for everyone.

Members across the chamber will remember that last May, an amendment of mine was successfully passed with the support of Labour, the Liberal Democrats and the Greens. That sought to set the target of all homes reaching an EPC C rating, where feasibly possible, by no later than 2030, as opposed to the current target date of 2040.

At this time, the Scottish Government has failed to honour the will of the Scottish Parliament and is pushing ahead with the 2040 target instead. It might come as a surprise to SNP members, but we want to work with them to achieve ambitious but attainable targets.

It is not just the target date that we want to see improved; we also wish to see a review of the method by which EPCs are produced. In December last year, a Common Weal article stated that the method is fundamentally flawed, particularly due to the reliance on using modelled energy-consumption data rather than measured data. Just recently, a constituent was in touch about two EPC assessments that had been carried out for them within two years, by the same contractor, with completely different outcomes. Either we need to see a review of how EPCs are produced, or an alternative is needed to ensure that they are more accurate and standardised.

As the Common Weal article mentions, if a household is under or overestimated on their energy consumption by an inaccurate EPC rating, residents either face higher than expected energy bills, or it deters them from making behavioural changes and investing in making energy efficiency improvements.

As an MSP who represents a rural area, I must also add my concerns that the bill does not consider the added costs for people living in rural communities. I was pleased to see in the committee’s report that that was requested of the Scottish Government. I hope that it will be acted on, as we heard the minister talk about it in his opening speech.

The minimum income standard is another important yet contentious point. A review is required for a Scotland-specific version, which would consider remote and rural households, but we must also take into account concerns such as those raised by the Scottish older people’s assembly that the new definition is likely to result in fewer households with older people being considered fuel poor. While I wish to see rural communities protected, that should not be to the detriment of other sections of society.

Herein lies the difficulty with the 5 per cent target. Yes, it is a great start, but it means that there is a risk of leaving in fuel poverty those who are at most need, such as the vulnerable in society, and rural communities. Therefore, I join my colleagues in calling for a separate target looking to eradicate extreme fuel poverty, to ensure that those who are hardest to reach are not left in the 5 per cent bracket. I would also be keen to see each local authority with its own 5 per cent target, so that no area of Scotland is disadvantaged by a national average that is weighted in favour of the predominantly urban central belt.

Andy Wightman

Will the member take an intervention?

Alexander Burnett

No, I will not. I have a number of points to make.

While the bill brings about lots of good action points on how to reduce fuel poverty, I am concerned that the financial memorandum does not estimate the cost of eradicating fuel poverty. Surely the bill should allocate extra costs in order to tackle the issue. If the Scottish Government does not even think that the bill merits additional funding in order to achieve its goals, that shows exactly why it is not going far enough. The committee reported that it was surprised that, while the Government provided estimated costing for meeting climate change targets, it chose not to take the same approach for this bill.

Kevin Stewart

Will the member take an intervention?

Alexander Burnett

I will not, as the minister also has a closing speech. I recognise the points that he made in response to the committee’s report and we look forward to seeing them when they materialise.

The Scottish Conservatives’ proposal is to invest up to 10 per cent of the Scottish Government’s capital budget allocations in energy efficiency measures. That policy would make more homes warmer, eradicate fuel poverty at a greater rate and reduce carbon emissions faster than the SNP proposals, all while growing businesses and the economy across the whole of Scotland.

While this bill is a step in the right direction and we fully support its principles, it still needs to do more. At this stage, my colleagues and I look to support the bill, but we wish to continue working with members across the chamber to ensure that it can be strengthened.

16:10  
Dr Alasdair Allan (Na h-Eileanan an Iar) (SNP)

As other members have mentioned, fuel poverty remains a significant problem throughout Scotland, despite the £1 billion investment that SNP Governments in past sessions of the Parliament have committed to energy efficiency measures to deal with it.

I make no apology for pointing to the particular problems that face my constituency and, I am sure, other island constituencies. In 2016, the rate of fuel poverty in the Western Isles was calculated at 56 per cent, according to the Scottish housing condition survey. Some of the reasons for that are obvious: the wind-chill factor, which is not recognised in the system of cold weather payments; the ageing population; and the preponderance of detached houses. Perhaps as significant as anything else, however, is the unavailability of mains gas anywhere in the islands except in one relatively small area of the town of Stornoway.

Neither is history irrelevant here. In the 1930s and 1940s, Government assistance was aimed at getting people out of thatched black houses. That resulted in a generation of self-built houses made of poured concrete, which was generally mixed with shingle from island beaches to form walls with no cavities. Another wave of kit house building took place in the 1970s and 1980s. In short, few of the houses that were built in the islands in the greater part of the 20th century are anything like thermally efficient.

On the face of it, many people in such a situation may be home owners. However, as often as not, the reality in the islands is that they might own the house but not the land underneath it—a feature of crofting tenure that is too complicated to explain to virtually any building society, which means that many people live in houses that they simply cannot afford to repair. Then there are all the usual problems with which people have to contend, and which are by no means specific to the islands: low incomes; the roll-out of universal credit; a shortage of affordable rented housing; and, above all, the spiralling cost of energy over the past 15 years or so, which the minister has pointed out. I see from the Local Government and Communities Committee’s report that its members saw all those problems for themselves at first hand when they visited my constituency recently. I very much welcome their having done so.

I warmly commend, too, the minister’s commitment today to recognise rural—and perhaps specifically island—factors in the future and the fact that the bill will be subject to an island communities impact assessment. I hope that, in his closing remarks, the minister will say whether the strategy following the bill will be subject to a similar island-proofing process and which distinctive island factors it might be possible to recognise in our future policy on fuel poverty.

For example, I hope that, as has been indicated today, in defining an acceptable standard of living once fuel costs are met, there might be room to take account of the extra costs that are involved in living in an island area. Not least among those is that, in many island areas, it is simply not a realistic option not to have a car. Many people in island communities would consider themselves unable to afford a car if they lived elsewhere but feel that they have no choice but to have one if they wish to look for work—and that is before higher food, petrol and other prices are considered.

There are other factors that people in most parts of Scotland—both rural and urban—take for granted. Most Scots can easily visit a relative in hospital who has suddenly been taken seriously ill, or go to a funeral in another part of the country. In the islands, because plane fares go up exponentially if bought a day or two before travel, making such a visit can often cost as much as going on a foreign holiday.

It is right that the Parliament is held responsible for the factors that are within our control. Of those, the major investments in energy efficiency, particularly in older people’s houses, should be recognised and welcomed. However, as other members have mentioned, it is also right that we scrutinise areas that are outwith our devolved control, such as the significant rise in the cost of fuel in recent years, and the fuel poverty that is directly traceable to changes in the benefits system.

I end, however, by expressing a hope that island proofing will come to recognise another specific problem that all off-grid areas have. Why are the energy efficiency ratings that are used on EPCs measured in pounds sterling and not in kilowatts of energy used per square metre? By definition, being off the gas grid makes costs higher, but it says little about the energy efficiency of the building. The result is often that, compared with people who are on grid, home owners in off-grid areas face an impossible task in getting to band C.

All that said, I very much welcome the bill and the Government’s clear commitment to making it work in the islands and across Scotland to tackle what remains, despite substantial and welcome efforts by the Scottish Government, one of the single biggest problems that my constituents face.

16:15  
Jackie Baillie (Dumbarton) (Lab)

I start by declaring an interest as one of the honorary vice-presidents of Energy Action Scotland.

As the minister in the first Labour-led Scottish Government who was responsible for establishing the fuel poverty target, I am pleased to take part in this debate. Members will perhaps forgive me if I therefore look back, because I think that we can always learn from history.

It was section 88 of the Housing (Scotland) Act 2001 that committed Scottish ministers to ensuring that, by November 2016,

“so far as reasonably practicable, ... persons do not live in fuel poverty”.

That was an ambitious target and one on which all parties across the Parliament agreed. Indeed, Stewart Maxwell, who served as the SNP Minister for Communities and Sport from 2007, said:

“We signed up enthusiastically to the previous Administration’s target, which was bold when it was established in 2001.”—[Official Report, 13 March 2008; c 6914.]

That was the right thing to do, and successor Administrations agreed. We do not often find issues that transcend the political divide, so it is disappointing that, with that level of consensus, we singularly failed to meet the target.

Where did it go wrong? Back in March 2008, speakers in a members’ business debate on fuel poverty thought that the target was tough but achievable. Later that year, Nicola Sturgeon, as Deputy First Minister, reconvened the Scottish fuel poverty forum to advise ministers on how to refocus the policy and better use the resources that were available to achieve the target. We were all still talking about eradicating fuel poverty and achieving the target. Of course, there were increases in fuel prices and factors that we did not entirely control, but we did not think that that was a barrier to doing all that we could to achieve the target. Not one SNP member or member of another party in the Parliament raised that as an issue when we set the original target.

Three years later, in 2011, five years before the target date, members of the Scottish fuel poverty forum were telling anyone who would listen to them, from ministers to parliamentary committees, that unless there was a substantial increase in resource, we would fail to meet the 2016 target. The spending level back in 2012-13 was £65 million. Following its budget scrutiny, the Economy, Energy and Tourism Committee believed that the budget needed to be of the order of £100 million to £170 million per year if we were to succeed in eradicating fuel poverty. Unfortunately, the Government decided that it knew better. In budget after budget, Opposition members made the point. I recall Patrick Harvie bringing down the budget one year on this very point. In some years, there were even underspends, but the sums fell well short of what was required. By 2012, few people believed that the target could be met and ministers did little to try to change that.

Annabelle Ewing

As we have heard, the increase in energy prices was not a de minimis increase but an increase of 158 per cent. Is the member trying to suggest that that had no impact at all on the issue?

Jackie Baillie

I am not suggesting that, but we ignored the fact that the increase had had an impact and we failed to address what we then needed to do to recalibrate in order to meet the target. It is not good enough to say that it is somebody’s else’s fault and do nothing to try to change that.

On reflection, I am clear that we need to start with an ambitious target, to have a route map for how to achieve it and to monitor implementation closely. We also need to have enough money in the budget to realise our ambitions, to have parliamentary ownership and maybe even to have some independent oversight so that ministers’ feet are held to the fire when necessary.

The bill’s target of taking fuel poverty down to 5 per cent by 2040 is lacking in ambition. Taking the number of fuel poor down between now and that target date means a reduction of 1 per cent a year, which makes a snail’s pace look fast and condemns another generation to fuel poverty. The target should be 2032. Changing the definition is also very troubling. The Scottish Government has changed its methodology and analysis at least four or five times and on each occasion more people in fuel poverty got measured out. With the greatest respect, redefining fuel poverty or changing the methodology to simply take people out of the equation fiddles the figures while Rome burns.

Kevin Stewart

That is nonsense.

Jackie Baillie

It is not nonsense.

People tell me that pensioners and people living in rural areas suffer most from fuel poverty, but the Scottish Government has moved the qualifying age from 60, where it currently is, to 75. The minister will be aware that many people in Scotland, particularly those in disadvantaged areas, do not reach the age of 75, but they still live in acute fuel poverty. At stage 1, the minister said that he would consult on that in bringing forward regulations, but we should know now what the Government’s intentions are. I am interested to know whether he would rule out shifting the qualifying age as high as 75.

Other members have touched on minimum income standards, and I agree with Andy Wightman’s comments in that regard. I will spend the short time remaining to me to talk about monitoring. Parliament must, of course, have an active role, but I suggest to the minister that, rather than having the Scottish fuel poverty advisory forum on an ad hoc basis, it should be given statutory underpinning and be independent of ministers. I listened carefully to what the minister said, but I am not persuaded by his argument. We should give the forum the tools and the teeth to do its job.

We have a once-in-a-generation opportunity to alleviate and eradicate fuel poverty. I welcome the steps that are being taken in the bill, but there is an opportunity to do so much more. When this Parliament was created, it seized those opportunities to be bold and ambitious, to change the policy landscape and to be positive about the future for the people of Scotland. Twenty years on, we should not be timid about this or condemn another generation to having to choose between heating and eating. We should seize the opportunity to eradicate fuel poverty in Scotland.

16:22  
Jamie Halcro Johnston (Highlands and Islands) (Con)

My region of the Highlands and Islands is where fuel poverty, by any reasonable definition, is most pronounced. As many members will be aware, a number of factors contribute to the problems that the region faces in that regard, including a slightly less hospitable climate in some seasons, the limitations of the mains gas network, the wider economic challenges of the region and an ageing population. When considered against the backdrop of higher living costs in less densely populated areas—a problem that the region shares with other remote and rural parts of Scotland—fuel poverty clearly has a regional element to it and is an issue of particular relevance to my constituents.

I will illustrate that with some examples. Orkney Islands Council and Western Isles Council have the sorry record of being the local authorities in Scotland where over 50 per cent of households are in fuel poverty under the current definition. The five local authorities with the highest proportion of households without mains gas are all in the Highlands and Islands, and those councils also find themselves near the bottom of the table for energy efficiency measures. Setting aside the island authorities, which have their own particular needs, it is the Highland Council and Moray Council areas that experience the highest levels of fuel poverty in mainland Scotland.

Dr Allan

Will the member take an intervention?

Jamie Halcro Johnston

I would like to get on.

Where levels of fuel poverty are that high, fuel poverty can become less visible. Many people in those communities—particularly older people—would not immediately identify themselves as being in fuel poverty, regardless of where statistical definitions place them. High energy costs and lower disposable incomes can often be treated as a fact of life. Policy makers may think that that makes them a less pressing problem, but individuals, families and the wider economy are impacted just the same. Individuals are left making the same unpleasant and undesirable trade-offs in order to heat their homes adequately.

Before I turn to some of the conclusions of the stage 1 report, I extend my thanks to the committee for a comprehensive and informative piece of work. The report identifies and notes a number of the localised concerns that I have raised.

One area that the committee was right to highlight is extreme fuel poverty. As members have observed, there is a risk that targets at a national or even a local authority level could create perverse outcomes whereby the low-hanging fruit are tackled first while those in the greatest need are abandoned. I therefore welcome the Scottish Government’s commitment to lodge stage 2 amendments. We will look at them in some detail.

The committee’s report quotes from the evidence of Alasdair Calder of Argyll and Bute Council, who spoke about the need to avoid a situation in which the 5 per cent of homes still in fuel poverty in 2040 are all located either on the islands or in rural areas in his council area. It is a question not simply of deprioritising the worst cases but of failing to address areas whose geography makes them more difficult and potentially more expensive to reach.

The committee also addressed local issues with the use of the minimum income standard. The fact that remote and rural areas have particular problems is not controversial, but the Scottish Government’s early conclusions that those problems will be accounted for in the MIS and that the additional costs of gathering better data would be prohibitive seem to have been largely contradicted by the committee’s evidence. I therefore welcome the minister’s comments about the islands MIS. He assured the committee that he would

“look seriously at ... an uplift ... for remote rural areas”.—[Official Report, Local Government and Communities Committee, 19 December 2018; c 3.]

I am pleased that he appears to have done so, but it is important that his assessments be scrutinised effectively by Parliament. If he wants to build cross-party support, that work needs to be undertaken seriously, because such changes are not to be taken lightly.

Let us consider the relative impact of the proposals. The number of older households in fuel poverty will be deemed to have fallen by 137,000 at the stroke of a pen, while some 60,000 people with a long-term sickness or disability will be removed from the statistics. Many people who are removed from the fuel poverty statistics will be in my region. Unsurprisingly, that has caused local organisations alarm, and I have heard from housing associations, local authorities and individuals on the point. It is important not to send a message to people in rural Scotland that we think their problems have been solved even though their circumstances remain the same.

I also welcome the Government’s commitment to carrying out an islands impact assessment on various aspects of the bill, which is important to meeting its commitment to the islands. In a policy area in which the islands are so clearly distinct from mainland Scotland, it is extremely important that that process be undertaken and that it command the confidence of those communities.

Like other members, I express disappointment about the bill’s downgrading from a more rounded warm homes bill, which represents a missed opportunity to take a comprehensive approach to tackling the issues. Unfortunately, the Scottish Government’s efforts have often appeared—at least to Conservative members—to be unfocused. Major policies such as the creation of a publicly owned energy company seem to have been created as soundbites first, with key details and direction to be ironed out later.

There is a pressing need to further address energy efficiency and its considerable regional disparities. It is welcome that the Government is willing to move on the bill, and I will join Scottish Conservative colleagues in seeking to strengthen it, but I emphasise that the issues raised by the committee must be considered seriously if ministers want wider support.

16:28  
Kenneth Gibson (Cunninghame North) (SNP)

As a member of the Local Government and Communities Committee, I was pleased to work with colleagues on our stage 1 report on this important bill, which has the potential to have a hugely positive impact on the lives of thousands of households across Scotland.

In 2017, a quarter of Scottish households—613,000—were classified as living in fuel poverty. The previous Scottish Executive had hoped to eliminate fuel poverty, but, despite its best intentions and those of its successors, its efforts were stymied by increases in fuel prices, over which it had no control: they rose by 155 per cent while wages grew by 38 per cent. That was highlighted by the £110 increase in the default tariff 13 days ago, which Pauline McNeill mentioned.

The bill’s principal aims are to set out a new target for a dramatic reduction in fuel poverty that is both ambitious and achievable; to introduce a new definition of fuel poverty so that support can reach those who need it most; to produce a new long-term fuel poverty strategy; and to oblige the Scottish ministers to publish reports and lay them before Parliament every five years. Stakeholders have agreed that enshrining a target in legislation will provide a clear end point against which to measure progress.

Some people may ask why the aim is not to completely eradicate fuel poverty. The 5 per cent target takes into account the Scottish Government’s limited influence over two of the four main drivers of fuel poverty: household income and energy costs. Another factor is the transient nature of fuel poverty, because some households move in and out of the definition due to circumstances that, again, this Government cannot control.

Setting a realistic target for 2040—I understood that all the committee members agreed to that; there was certainly no dissent in the report—while laying the groundwork with a sustainable and well-designed long-term strategy provides an opportunity to reduce fuel poverty even further.

I am pleased that the Scottish Government has agreed to enshrine interim target milestones in the bill at stage 2 so that we can assess how well the strategy is working.

Andy Wightman

Kenneth Gibson has been an MSP for quite some time and will be well aware that, although committee members do their best to produce reports that we all agree represent the will of the committee, that does not mean that members of various parties do not take a different view when it comes to stage 1 debates, stage 2 amendments or stage 3 debates. He seems to insinuate that we should not be doing that.

Kenneth Gibson

No—what I am saying is that, to my understanding, all seven members of the committee agreed to the 2040 date without a scintilla of dissent, yet some of them have come to today’s debate pretending that they supported the date of 2032 all along. That is fundamentally dishonest. If someone is against something in a committee’s report, they should dissent from it. For example, Andy Wightman’s colleague on the Culture, Tourism, Europe and External Affairs Committee dissented when six other MSPs supported a view and another two MSPs abstained. That is how to do it. Members should not say, “Oh aye, 2040 is great,” then come to the chamber and say that that date is not radical enough—that is dishonest. I disagree with Andy Wightman on that.

Our evidence taking was not limited to hearing views in this building. Members visited Dundee and the Western Isles to hear at first hand from people about their lived experience of fuel poverty.

On Lewis, we heard from a woman who had three part-time jobs and relied on her credit card just to get by. Her traditional single-skin breeze-block cottage had a wood-burning stove and storage heaters. She was not on the gas grid, which is limited to Stornoway, as Alasdair Allan said. She left the island for work and rented out her home, and, on her return, the house was in a poor condition because the tenants could not afford to heat it. The result was damaged white goods and dampness in the walls. However, the woman received excellent support from local organisation Tighean Innse Gall, which arranged for external wall insulation. That remedied a situation that was quickly becoming unbearable for her.

We also heard from a man who lived in a 100-year-old croft house with thick stone walls and small windows. He reported that, once he had cavity wall insulation and new storage heaters, it felt like a new home, and those measures made a significant difference to his fuel bills. The experiences that were shared by people in fuel poverty demonstrated the harsh reality of being fuel poor and reaffirmed the committee’s view that the proposed legislation is essential.

We know that fuel bills are generally higher in island communities—not just in the Western Isles but on Arran and Cumbrae, in my constituency, and on other islands. That can be for a variety of reasons, including a lack of connection to the gas grid, increased exposure to wind and weather, overreliance on electricity and unregulated fuel types, and the presence of older, hard-to-heat homes.

As we have heard, the starkest disparity between regions is between the Orkney Islands, where 58.7 per cent of households are in fuel poverty, and Edinburgh, which has the lowest proportion—20.1 per cent—of such households. That is why, although the committee welcomes the revised definition of fuel poverty that is set out in the bill, which is based around the calculation of a minimum income standard that takes account of daily living costs, the MIS definition may not adequately take into account the reality of living on islands or in remote rural areas that are disproportionately affected by fuel poverty. Therefore, I welcome the minister’s commitment to an additional minimum income standard ahead of stage 2, as well as his commitment to publishing an islands assessment by the end of April.

Delivering a meaningful reduction in fuel poverty requires a concerted effort from everyone, including local government, businesses, the third sector, landlords, tenants and home owners.

No legislation exists in a vacuum, and this bill intersects with the aims on climate change, the new energy efficient Scotland programme, the energy efficiency route map and the draft fuel poverty strategy that is mandated by the bill. That suite of policies will reduce fuel poverty and improve home energy efficiency while reducing carbon emissions. Indeed, by the end of 2021, this Government will have allocated more than £1 billion since 2009 to tackling fuel poverty and improving energy efficiency. Jackie Baillie talked about £65 million being invested in 2012, but £113 million was invested last year, so there has been a significant increase in investment despite a challenging financial situation for this Government.

Jackie Baillie rose—

Kenneth Gibson

If Jackie Baillie had intervened earlier, I would have taken her intervention, but I am now over my time.

By achieving our challenging target of reducing fuel poverty to 5 per cent, we will not only be one of just a handful of countries around the world to do so, but, more important, we will draw ever closer to a fairer Scotland where nobody is forced to choose between eating and heating.

16:34  
Claudia Beamish (South Scotland) (Lab)

This has been a significant stage 1 debate in which many important issues have been highlighted by members across the chamber. As colleagues have done, I welcome the bill.

It occurs to me that Parliament has countless times denounced fuel poverty as Scotland’s shame, yet hundreds of thousands of households still battle against its effects. It is unacceptable that people across Scotland sit down of an evening and weigh up whether they should warm their homes or fill their stomachs.

Liam McArthur stressed the range of health and education downsides of living in fuel poverty. How is an elderly person to protect their health in a draughty room? How is a child to excel at school when their home is distractingly cold? How can a carer support their loved one in a home that has pitiful insulation? I remind Parliament that our right to adequate housing is enshrined in the United Nations Universal Declaration of Human Rights. We clearly feel the changing seasons in Scotland, so “adequate” here must mean “warm”.

As Jackie Baillie stressed, there was consensus about eradicating fuel poverty by 2016. Her historical analysis was chilling. Where is the recalibration that is needed? To its eternal shame, the Scottish Government has not done enough on that.

Annabelle Ewing

Will the member take an intervention on that point?

Claudia Beamish

I will not. I have made the point and so did Jackie Baillie. It has been well made.

We now have a bill on fuel poverty, but I share the serious concerns of my colleagues that the 5 per cent of households that will be left in fuel poverty will be those that are most difficult to tackle, and which have already suffered for decades. I therefore welcome the minister’s commitment to producing a definition of “extreme fuel poverty”.

The Existing Homes Alliance Scotland is a broad and significant coalition. It has stressed—and I quote—

“the need to take the higher cost of remote and rural living into account.”

Frankly, it is a relief that the stage 1 report recognises that the new definition that is proposed in the bill does not adequately take that into account. I strongly welcome the minister’s commitment to lodging an amendment on rural living at stage 2. It is vital that we ensure that there is an uplift for rural dwellers. That the bill will be island proofed—which has been committed to by the minister today and the need for which was previously stressed by Liam McArthur, Alasdair Allan and others—is vital.

As an MSP for South Scotland, I am keenly aware of the challenges that are faced by people who live in rural fuel poverty, who are often off-grid and living in hard-to-heat old stone houses. The Scottish Government might consider how help could be given to collective or co-operative rural support. That could be part of the strategy, if it is not to be in the bill, especially in relation to low-carbon energy solutions such as biomass.

More widely beyond the bill, co-operative and mutual models of energy production, distribution and sale have a role to play in tackling fuel poverty. When Britain’s energy system is not working for consumers, those models are means by which to empower fuel-poor, disadvantaged and excluded communities. I accept that that involves reserved issues.

However, Pauline McNeill highlighted the problems that exist for larger families who can see their annual bills rise by up to £184 per year. The market might be broken, thanks to a combination of lack of competition, which results in market dominance by a small number of large vertically integrated companies, unsustainable and short-term decision making by big business, and housing stock that ranks among the least energy efficient in Europe.

However, consumer, local government, community and employee ownership models have been shown to offer behavioural benefits, as people show more consideration of their own energy use. The models also offer economic benefits by helping with job creation and with returns from them remaining in the locality through reinvestment.

We need a fuel poverty bill, for sure—for the sake of people’s health, wellbeing and financial equality, and for the sake of our efforts to tackle climate change. The narrow scope of the bill means that it will not deliver specifically on lowering climate change emissions from housing. However, I welcome the minister’s commitment to finding the way forward, with COSLA and the committee, on reporting duties that would run in parallel with the current climate change reporting duty.

In her opening remarks for Scottish Labour, my colleague Pauline McNeill explored the private rented sector. There has long been concern about homes in which the opportunity to improve energy efficiency does not lie wholly in the hands of residents—for example, in the private rented sector. I welcome the work of the Scottish Parliament’s working group on tenement maintenance, of which energy efficiency in common improvements is an important part.

I highlight that I tried in 2014 to amend the Housing (Scotland) Bill at stages 2 and 3 to add a duty to make provision for energy efficiency standards in the repairing standard, but the Scottish Government did not support that. At that time, I withdrew my amendments on the understanding that the issue would be tackled with other energy efficiency concerns. The issue is complex, but I hope that that will not be used as an excuse to avoid tackling it. Stage 2 and beyond should be seen as an opportunity.

I hope that the Scottish Government will engage with those of us who are keen to address multi-occupancy and the private rented sector. I understand that members across the parties are keen to do that.

Scottish Labour welcomes the bill and supports its general principles, but there is a lot of room for improvement. The minister has acknowledged that, on the basis of the Local Government and Communities Committee’s report. However, in the view of Scottish Labour, we still have a considerable way to go.

16:40  
Alexander Stewart (Mid Scotland and Fife) (Con)

I am pleased to have the opportunity to close this stage 1 debate on the Fuel Poverty (Target, Definition and Strategy) (Scotland) Bill for the Scottish Conservatives.

Our manifesto in advance of the 2016 Scottish Parliament elections made it clear that the Scottish Conservatives are committed to ensuring that no one lives in a hard-to-heat home, and to reducing fuel poverty. We are therefore happy to support the broad principles of the bill.

More specifically, we pledged to make the case to transform investment in the energy efficiency of homes across Scotland. We suggested that that could be done by investing up to 10 per cent of the Scottish Government’s capital budget allocations in energy efficiency measures. That could lead to thousands of jobs across Scotland, make homes easier to heat, and reduce energy bills and carbon emissions. The bill is certainly needed at this time to tackle that issue, which is driven by a complex combination of energy costs, energy efficiency, household incomes and energy use.

At present, a quarter of households in Scotland live in fuel poverty. We have heard that today, and we have also talked about rural and island communities. The convener of the Local Government and Communities Committee, James Dornan, commented on that. I am delighted that Kevin Stewart will lodge amendments at stage 2 to cover issues in our rural and island communities.

It has been a real privilege, as a member of the Local Government and Communities Committee, to have heard from groups, individuals and organisations that have ensured that we have heard their views and opinions. Prior to the debate, many members received useful briefings that gave those views and opinions.

Previous attempts by successive Governments to address the issue have been unsuccessful. We heard from Jackie Baillie about what the target that was set out back in 2002 attempted to do, and that the Government wanted to ensure that it was reached by 2016. We have heard that, for various reasons, that did not happen.

It is important that the Local Government and Communities Committee and communities across civic Scotland support the bill because they see the need for things to happen. However, the bill does not include any accountability mechanisms. That was one of the key flaws in the 2016 target. In other words, consequences are needed for the Scottish Government if there is failure to meet the targets in the bill, otherwise the ambitions will not be met and we will simply end up with simple and meaningless propositions.

Kevin Stewart

Will the member give way?

Alexander Stewart

I would like to make progress.

I do not want targets not to be met. We want to ensure that the bill is successful, so there will need to be amendments and changes to it.

It is disappointing that interim targets are not set out. That was talked about in the draft fuel poverty strategy. The committee and stakeholders who responded to the consultation made clear their support for the statutory underpinning of such milestones—indeed, the committee requires them to support the target date of 2040. I note that the Minister for Local Government, Housing and Planning has proposed to lodge amendments at stage 2. As I said earlier, I welcome that. We need them to ensure that that happens.

By using a nationwide target, the bill could ensure that there are regional disparities. The committee suggested that the Scottish Government amend section 1 and put in place for each local authority statutory targets to reduce fuel poverty in their areas. That should also be considered.

We have heard from many members this afternoon. Graham Simpson said that the bill should help to eradicate fuel poverty, but it will only set a target, so there is a lack of ambition. The bill is a step in the right direction, but it is a step in the right direction only at this point.

My colleague Alexander Burnett talked about the bill’s focus and the need for the targets to be valid and obtainable. He also spoke about standardisation and the support for rural and remote households.

Many members have made valid contributions to the debate, which shows the depth of feeling about the issue across the chamber and across Scotland. Jamie Halcro Johnston talked about missed opportunities. He said that the rate of fuel poverty is highest in his Highland region and that people need to accept that as a fact of life. Fuel poverty should not be a fact of life for individuals and communities the length and breadth of Scotland.

Pauline McNeill talked about the bill falling short, in that it does not provide the ambition that she and the Labour Party had hoped for. Andy Wightman talked about the unacceptable level of fuel poverty, which we all need to acknowledge. Therefore, it is vital that we look at how we can enhance reporting and support.

Liam McArthur talked about the lack of ambition in addressing the problems in rural and island areas. He talked about the choice between heating a home or eating, which is a fact of life for some people. They are put in that situation.

The Scottish Conservatives are committed to tackling fuel poverty and to reducing the level of overall carbon emissions. As I have indicated, although we support the general principles of the bill, a number of important changes are required. We shall support the bill at stage 1, but we will lodge amendments that will strengthen the bill at stages 2 and 3. That is the right thing to do, and we should ensure that we all work together to achieve that.

16:46  
Kevin Stewart

As I said at the outset of the debate, the Government is ambitious in its desire to tackle, reduce and, ultimately, eliminate fuel poverty in Scotland. Beyond that, we need to ensure that we reduce the rate of carbon emissions in our country, and we need to move forward in delivering technologies to ensure that that becomes a reality.

The bill is not a stand-alone measure. It goes hand in hand with the carbon reduction bill, which will be introduced to Parliament very shortly, and with the bill that Mr Wheelhouse will introduce on district and local heating strategies.

Beyond those bills, I draw members’ attention to the draft energy strategy and to the energy efficient Scotland pipeline. In the energy efficient Scotland route map, we lay out our ambitious targets on EPC ratings to deal with fuel-poor homes. Fuel-poor homes should reach EPC band C by 2030 and EPC band B by 2040. Those targets will act as a guide for our programmes, to ensure that delivery to fuel-poor households is prioritised.

Graham Simpson

During the debate, the minister will have heard concerns from a number of members, including Alasdair Allan, about EPC ratings and their effectiveness. Is he willing to look at that issue on a Scotland-wide basis?

Kevin Stewart

Building standards officials are looking at EPC ratings—that is part of the Government’s on-going, day-to-day work. We keep all such matters under review, and I am happy to hear members’ views. I remember receiving Mr Burnett’s letter about his constituent’s situation in relation to EPC assessments. If folk want to feed into the process, I will ensure that their views go to building standards officials so that they can play a part in the work that the officials are doing.

As I have said, this is not a stand-alone bill but part of a suite of legislation and regulation that we must bring forward if we are to do our level best for the people of Scotland. I do not want anyone to live in a fuel-poor household. I remember as a child living in a house that was heated by a two-bar fire in the living room and a Superser heater upstairs, with the bedroom doors open to let the heat get through—

Pauline McNeill

You were lucky!

Kevin Stewart

I was lucky, compared to some.

We had ice forming on the inside of the windows—through no fault of my parents, who were doing their level best. I do not want anybody to live in those circumstances, and I want to move as quickly as we can on these issues, but we have to be realistic about what is deliverable and what can be achieved in certain timescales. I have heard a lot today that differs from the committee report in relation to moving further and faster on some of the targets, but I have not heard anything about how we deliver things quicker or how we achieve that deliverability. I have said time and time again that what we are putting in place is ambitious and deliverable—just—but it is also stretching, and folks who are thinking of lodging amendments to bring targets forward will have to look at how those can be delivered.

Pauline McNeill

The minister has asked the parties to think about how we can deliver that aim, but I ask him to consider the suggestion that I made in my speech. The delivery aspects of the bill could do with a bit more content. If the minister is indeed open minded about accepting amendments on delivering on the detail of reducing fuel poverty, will he consider substantially amending those aspects of the bill?

Kevin Stewart

The delivery aspects are not necessarily in the bill; they relate to delivering the energy efficient Scotland programme, adapting things as we move forward and ensuring that the draft fuel poverty strategy becomes something that works for all. Sometimes in the Scottish Parliament we get a little bit fixated with primary legislation, but it can be very difficult to create primary legislation that focuses on delivery. The documents that I have mentioned and the scrutiny of these matters as we move forward will be extremely important and key to ensuring that we reach the targets to which we aspire.

Claudia Beamish

Will the minister give way?

Kevin Stewart

Very briefly.

Claudia Beamish

Does the minister agree with the importance, as highlighted in my speech, of local energy production and work by co-operatives in not only supporting local jobs but helping people in fuel poverty to tackle the situation?

Kevin Stewart

Absolutely. I believe that if we get progress on the matter absolutely right, we can create jobs. It will be a matter not just of handing jobs to multinational companies, as has happened often in the past, but of local delivery.

The prime example of that can be found in Orkney. When I first came into my post, civil servants told me that Orkney was unable to spend its area-based scheme money. It was suggested that I take the money back, but I did not do that, because I saw that Orkney required more time than other authorities to set up the supply chain and the skills to deliver what it needed.

I would like to see the same kind of thing happen across the country, but if we are pushed to move too quickly on the matter, local authorities might not be able to do what Orkney did and might be pushed into procuring things elsewhere—perhaps from places where Ms Beamish would not want them to be procured. There is absolutely a logic to taking some time to get certain aspects of this right. However, as I have said, if anyone comes forward with a delivery plan that works in bringing targets forward, I will certainly look at it.

Having listened to the committee, I have made some moves on interim targets and minimum income standards that—I am pleased to hear—folk are happy about. One of the key things is the tackling of extreme fuel poverty, and I will without doubt bring forward amendments on that at stage 2.

I will continue to listen. Movement has happened not just because of the committee’s work but because of the engagement between members and me and with stakeholders at large. That will continue as we progress with not just the bill but the energy efficient Scotland programme, the right fuel poverty strategy and the other bills that are to come.

Liam McArthur

Following Pauline McNeill’s point about access to the available funds—[Interruption.]

Kevin Stewart

I am sorry, Presiding Officer, but I cannot hear Mr McArthur.

The Presiding Officer (Ken Macintosh)

Can we have a bit of order in the chamber and fewer conversations, please? Let us listen to Mr McArthur.

Liam McArthur

Pauline McNeill highlighted some of the difficulties in accessing funds. Some people who live in listed properties find it exceptionally difficult to introduce measures. Will the minister speak to his colleagues to ensure that heritage and fuel poverty objectives are better aligned than they appear to be at present?

Kevin Stewart

I will certainly do that. I am well aware that, in Mr McArthur’s constituency, there are council houses that date back to the Napoleonic era, and those are difficult to deal with.

On Ms McNeill’s point about a joined-up approach, I suggest that everybody talks to home energy Scotland. Its award-winning helpline is absolutely fantastic and it will guide people to the right places and give them the right advice. I am more than willing to speak to Ms McNeill and others about where they think that the difficulties lie for folks in accessing grant and/or loan funding. I want to make that journey as easy as possible for people so, if Pauline McNeill wants that conversation, I am more than happy to have it.

There have been a few myths today, which I need to touch on. Ms Baillie talked about modelling and analysis being changed four or five times and said that each time more households were taken out of fuel poverty. The changes in the modelling and analysis have happened only to reflect the changes to industry standards and energy modelling, and for no other reason at all.

Jackie Baillie

Will the minister take an intervention?

Kevin Stewart

I will take a very brief one, although I really feel that I should not.

Jackie Baillie

When I accused the minister of changing the methodology and analysis, he said that that was nonsense, but he is now admitting that I was right. Will he tell the Parliament that, on each occasion, more people were taken out of fuel poverty, even though their experience continued to be one of being in fuel poverty?

Kevin Stewart

What I said was nonsense was Jackie Baillie’s point that the changes in modelling and analysis took more folk out of fuel poverty—that was the absolute nonsense that Ms Baillie was speaking. She introduced the original bill on fuel poverty, which was the Housing (Scotland) Bill, and perhaps then there was no foresight about possibilities and scrutiny, so she should reflect on that. We need to get this absolutely right.

I will finish with a point that some members have touched on but which seems to have been lost to others. We do not have control over all the levers that lead to fuel poverty. We do not have control of energy prices, although I wish that we did, and we do not have control over incomes. Even though Mr Wightman attempted to say that we have a small amount of leverage in that regard, we do not have the ability to deal with things that the UK Government does, such as the changes in VAT, the poor roll-out of universal credit and the slashing of social security—the list goes on. As a Parliament, we should unite on those issues to ensure that we have control over every aspect of the matter so that we can truly move forward and do our very best for the people of Scotland.

I am grateful to the committee for its efforts. I found it a bit surprising that many speeches today did not reflect the committee’s report. However, we are where we are, and I am grateful to members for sharing their views.

I will continue to listen to members and stakeholders as we move forward to stage 2. I hope that we can do that in a logical fashion, lodging workable amendments that have no unintended consequences.

MSPs agreed that this Bill could continue

Stage 2 - Changes to detail 

MSPs can propose changes to the Bill. The changes are considered and then voted on by the committee. 

Changes to the Bill

MSPs can propose changes to a Bill  these are called 'amendments'. The changes are considered then voted on by the lead committee.

The lists of proposed changes are known as a 'marshalled list'. There's a separate list for each week that the committee is looking at proposed changes.

The 'groupings' document groups amendments together based on their subject matter. It shows the order in which the amendments will be debated by the committee and in the Chamber. This is to avoid repetition in the debates.

How is it decided whether the changes go into the Bill?

When MSPs want to make a change to a Bill, they propose an 'amendment'. This sets out the changes they want to make to a specific part of the Bill.

The group of MSPs that is examining the Bill (lead committee) votes on whether it thinks each amendment should be accepted or not.

Depending on the number of amendments, this can be done during one or more meetings.

First meeting on changes

Documents with the changes considered at this meeting: 

Video Thumbnail Preview PNG

First meeting on changes transcript

The Convener

Agenda item 3 is consideration of the Fuel Poverty (Target, Definition and Strategy) (Scotland) Bill at stage 2. I welcome to the meeting Kevin Stewart and his officials. I also point out that because some non-committee members have lodged amendments that might be debated today, they are likely to attend later this morning.

When the bill was introduced, the Presiding Officer determined that a financial resolution is not required for the bill. Under rule 9.12.6C, the Presiding Officer has determined that the costs that would be associated with amendments 48 and 62 would, in themselves, exceed the current threshold that requires a bill to have a financial resolution. As a result, although the amendments may be debated as part of stage 2 proceedings, they may not be agreed to, in the absence of a financial resolution.

The Presiding Officer has also ruled that amendments 93, 31, 81, 84, 82 and 85 are cost bearing, but the potential cumulative cost of the amendments does not require a financial resolution. As a result, those and any consequential amendments may be debated and the questions put on them, as is normal in stage 2 proceedings.

Section 1—The 2040 target

The Convener

Amendment 53, in the name of Alex Rowley, is grouped with amendments 55, 66, 67, 69, 70, 77 to 80, 86 and 90 to 92. I draw members’ attention to the eight pre-emptions, as shown in the groupings.

Alex Rowley

Amendment 53 seeks to move the fuel poverty target from 2040 to 2032, because my view is that the 2040 target is not ambitious enough, and that we need to be more ambitious in driving the Government’s fuel poverty objectives.

In the evidence taking for the bill, a number of members commented on the fact that since they have been here—and, indeed, since the Parliament’s inception—targets for tackling fuel poverty have been set and missed. That, in itself, should be a lesson to us all that we have to be more ambitious. Indeed, we have been told as much by many people who have the broadest experience of tackling fuel poverty and who work directly with people who experience it. For example, Citizens Advice Scotland, the rural and islands housing association forum, Inclusion Scotland, East Ayrshire health and social care partnership and the Existing Homes Alliance Scotland have all said that we need to be more ambitious. Norman Kerr from Energy Action Scotland told us that the 2040 target

“condemns another generation to ... fuel poverty.”—[Official Report, Local Government and Communities Committee, 21 November 2018; c 11.]

We have also heard that a 2032 target would be more in line with the energy efficiency targets and the Climate Change (Emissions Reduction Targets) (Scotland) Bill.

It is important to have joined-up Government if we are to succeed in achieving the objective that all of us at the table share, which is to rid Scotland of the blight of fuel poverty. That is contingent on there being a strong plan and adequate funding. We support the Government developing an ambitious and well-funded strategy, and we believe that bringing forward the target would help us to drive that strategy. A number of our amendments would help to facilitate that.

I have also lodged an amendment that would give the Scottish fuel poverty advisory panel the power to recommend moving the target if we discover that, even under the best circumstances, the target cannot be met. This is not about setting up targets against which to fail; it is about having in place the best possible statutory structures to prevent people from the short-term and long-term harm that is associated with fuel poverty.

I accept that a number of drivers of fuel poverty are not under the control of the Scottish Government or Parliament. That said, there are drivers that are under our control and which we are less ambitious about tackling. For example, last week, I held an advice surgery in Ballingry in Fife, at which a lady came up to me, on whose case I have corresponded with the minister. There is a lack of insulation in her house. Her problem is a problem that many people in Scotland come across. The funding that is available through the various grants is not enough to pay for the types of insulation that are needed for steel-framed houses—including Stuart steel-framed houses—and timber-framed houses. There are not enough resources. We are not doing enough in relation to that driver of fuel poverty, so we need to be able to do more.

A few months ago a lady—again, I have corresponded with the minister and with the local authority about her case—brought to me photos of her timber-framed house. In the photos, it had been raining: you could see where the heaters were on the inside of the house because, on the outside, the timber frame was dry where they were. Heat is just pouring out of the house. There are loads of houses like that. Lack of insulation is a driver of fuel poverty that we surely need to be ambitious about. Imagine going back to those people and telling them that we have set a target for 2040. The people of Scotland will not be impressed by a 2040 target.

As I said, there has to be a clear strategy and there has to be funding to reach that target. Bringing forward the target to 2032 would give more impetus to the Government to put in the proper resources. We need to be serious about this. Where we can influence drivers of fuel poverty, we need to do so, and quickly. Otherwise, what are we saying?

The grants and the funding are not enough for us to meet fuel poverty targets. It is sad that although this Parliament, since its inception, has had the objective of tackling fuel poverty in Scotland, in 2019, we are saying that that target is being put off to 2040. I will be in my 70s by 2040. The people who are coming to my surgeries talking about fuel poverty now will probably no longer be alive in 2040. We must have more ambition and more hope, and that is why we should change that target to 2032.

Amendment 53 would not make the Government a hostage to fortune. If there are legitimate reasons why we cannot reach the target, we can change it. However, let us be ambitious for Scotland. Let us be ambitious about ending fuel poverty in Scotland, and shift the target to 2032 to drive the ambition to tackle fuel poverty.

I move amendment 53.

Andy Wightman

I support the amendments in the group. I want to raise two issues. In previous evidence, the minister has indicated that bringing forward the target from 2040 to 2032 would be extremely challenging and difficult. I understand that that is based on analysis that the Scottish Government has done that has not been shared with the committee. We do not have the evidence that the minister has with which to defend the 2040 target. Therefore, I am interested in seeing that evidence on the difficulties in achieving the 2032 target. Some of the minister’s language has suggested that achieving it would be an impossibility.

I will back the 2032 target, but with a proviso. Anyone who argues that we can or cannot reach a target by a date that is 12, 15 or 20 years in the future makes that statement with a degree of confidence, which might be a high degree or a low degree of confidence. Whatever target we set—whether it is 2032 or 2040—as we move forward it will become clearer whether that target will be achieved. I do not think that there is any shame in saying in 2025, for example, that we are not going to hit the target by 2032 or by 2040. Alternatively, we could be saying that we will easily make it by 2040, so we should bring forward the date.

My proviso is therefore that the bill incorporate Alex Rowley’s amendment 54, which provides for the target to be changed in the light of circumstances. If that amendment is accepted, I will be comfortable supporting the 2032 target, because if it is demonstrated that meeting the target will be impossible—I do not think that we can take that view now, but it could well be taken in 2025, for example—we will be able to shift the date. It would be reasonable to do that in the light of evidence and what we know.

On that basis, I will vote for Alex Rowley’s amendments in the group.

Annabelle Ewing

It is axiomatic that we all want fuel poverty to be tackled as quickly as possible—no one would doubt anybody’s commitment to that. I will remind the committee what we agreed on the issue in our stage 1 report, which brought in the different strands of our thinking. We said:

“The Committee notes concerns regarding the length of the target date set out in the Bill, which at 21 years is considerably longer than the 14-year target previous Scottish administrations had worked to. However, the Committee also understands views that this approach is a pragmatic response to previous attempts to set a target, which ultimately failed. We also recognise arguments that reducing fuel poverty will lean heavily on applying technologies still in development and that it is realistic to build in time for these to come on-stream.”

The committee went on to say:

“The Committee therefore accepts the Government's reasons for setting the target date at 2040. This would however be conditional on the Government bringing forward amendments to make at least some of its interim milestones statutory by way of amendment at Stage 2, and we are pleased to note that a public commitment has been made to enshrine two of these at Stage 2. If the amendments are agreed to, this should help protect the fuel poverty strategy from ‘drift’, and enable comprehensive assessment of how well the strategy is working at its mid-point.”

I think that the committee got it right at stage 1, and it took into account the minister’s commitment to introduce interim targets. Frankly, I do not see what has changed between our agreement at stage 1—no member dissented from those points in the report—and today.

I will pick up a couple of other points that relate to what has been said. I accept that a target was set previously and that it was missed. To be fair to the previous Labour-Liberal Administration and the first Scottish National Party Administration in 2007, certain events formed the backdrop in that period—there was a global economic recession and massively increased energy prices. It is only fair to put that in context.

However, things happen in life, and it is not always easy to entirely predict what will happen. That is particularly the case at the moment, in the context of the Westminster Brexit saga.

10:45  

The target was set and it was missed. To me, that does not seem to be a good reason to set a target that, collectively, for pragmatic reasons, we have agreed is not the best way forward. Instead, it seems to me to suggest that it is a good idea to keep the target that is in the bill—2040—which, for pragmatic reasons, is deemed to be achievable. That does not mean that, between now and 2040, nothing will happen and nobody will see an improvement in their living standards—the contrary is the case. We will see people move into a better situation in terms of their use of fuel, the warmth of their homes and so forth as the years progress, and we will be able to take advantage of the opportunity that is presented by the interim targets. It is an important point to make that what happens in 2040 will not be achieved from a standing start, with nothing happening between now and that point. We are talking about progress being made year on year.

On the point that there might be a possibility of the Government saying that it has got the approach wrong, that it is not moving forward quickly enough and that it should change the target, I would say that what we need is a clear plan or route map, which is what the current approach is in the fuel strategy document. We need a clear plan for how we intend to get from where we are to bringing everything together to meet the target in 2040. I think that that makes sense—it is a reasonable way to proceed. It provides some certainty, unlike the approach that is being suggested today, which was not suggested at stage 1 by anybody on the committee, and which involves the ability to somehow change back to the 2040 target in a few years. I do not see that as a practical or helpful way forward.

When I am dealing with cases in Ballingry or Cowdenbeath, for example, and I see the conditions that some of my constituents are living in—which I have to say include conditions in houses that are tenanted from Fife Council—the first thing that I do is get on to Fife Council to say, “What is going on here? Come and treat this home. This is absolutely unacceptable.” We have to understand that other players have responsibilities with regard to this matter.

Finally, as Alex Rowley pointed out, we in this Parliament do not hold power over all the key drivers, particularly energy prices and household incomes. To set a target that does not reflect that fact is not helpful to the people we are trying to help. We have to accept the reality of where we are. I would argue that the Parliament should have those powers, but not everybody around this table agrees with me. While we do not have those powers, it is unhelpful and, indeed, risky with regard to the goal of improving people’s lives to try to pretend that that is not the reality. It does not do the people who we are trying to help a service. Therefore, I am afraid that I will not be supporting Alex Rowley’s amendments in the group.

Kenneth Gibson

I agree with what Annabelle Ewing has said. I thank her for reading out the paragraphs from page 1 of our stage 1 report, because it saved me from having to do it.

We discussed the matter at some length and, based on the evidence, we came to a unanimous view, as I understand it, that 2040 was a realistic and achievable target and that 2032 was not. Therefore, like Annabelle Ewing, I am surprised that the amendments have been lodged and that they have some support on the committee.

The Convention of Scottish Local Authorities has said that it considers that it would be “callous” to implement another target that cannot be achieved. It is one thing to be ambitious, but reality has to come into play as well, which is why the committee decided what it decided.

Think about what lies ahead of us—we are going to go through Brexit, which the United Kingdom Government and the Scottish Government believe will lead to the Scottish economy shrinking by up to 8 per cent by 2030. Further, we will have fewer workers in our economy, and, therefore, there could be considerable issues with regard to labour shortages when it comes to implementing the policy to 2032, even with the best will in the world and even if finances were available.

Energy prices, which are one of the four drivers of fuel poverty, could increase if sterling continues to decline—indeed, energy prices have gone up 10 per cent in the past few months. We have to be realistic about what we can deliver.

Alex Rowley talked about putting in more funding, to properly resource the policy, but I did not hear him mention a figure for the estimated cost or say how the Government would be expected to source that funding and pay for his proposed approach.

Everyone on the committee wants fuel poverty to be eliminated at the earliest possible date, and we would all like the Government to be more ambitious. I would like the target to be elimination by 2025, if that were possible, but the reality is that that cannot happen, given current resource restraints. It is unfortunate, but 2040 is the most realistic date.

However, if progress is made—if the economy grows much more strongly than is anticipated, if fuel prices do not rise and if incomes go up—then yes, we can look again at the interim targets and perhaps bring the dates forward to 2036, 2032 or even sooner, if possible.

Nevertheless, as COSLA said, it would be callous to set a target and raise expectations that cannot be met. I urge the committee to reject Alex Rowley’s amendments.

Graham Simpson

This was one of the key issues that the committee had to deal with at stage 1.

I do not think that members of any committee should necessarily feel bound by a committee report. I fully accept that we produced a unanimous report, with nobody registering any dissent, but members of any party are free to go away and reflect on matters and then come to a different view.

During the stage 1 debate, I said that I was reflecting on the issue. I made the point that 2040 is a long time away and does not sound very ambitious. I think that at that point Mr Gibson got quite exercised and intervened, thinking that I was about to depart from the committee’s report. However, what I was actually saying was that I was still thinking about the target, because it is a difficult issue and there is no right or wrong answer.

I have reflected on the matter and my conclusion is this: if we are making law, it needs to be deliverable, so that there is a chance of achieving what we set out to achieve. The year 2032 is ambitious and I think that there is a good chance that we would not hit the target by then. There is a much better chance of our achieving the target by 2040, although I accept that that is a long way off.

My proviso to that is that we will need to put in interim targets. I note that there is an amendment in the minister’s name that would put in one such target. My preference is to put in a couple of interim targets. If there is no opportunity to do that at stage 2, we should consider doing so at stage 3.

Such an approach, along with the amendments on periodic reporting that we will consider later, would address the issue that Annabelle Ewing raised about the need for a clear route map. If we had not just one but at least two interim targets—two would probably do it—so that we could say, “By dates X and Y, we need to have achieved this target or that target”, it would not just be about 2040; we would have to hit other targets along the road.

Obviously, we have not yet agreed to that approach. However that is my view on things.

I would be comfortable with the 2040 target as long we can see a way to achieve what everyone on the committee wants, which is the eradication of fuel poverty—although I am not quite convinced that we can eradicate it completely.

In the stage 1 debate, Andy Wightman said, on targets, that we should

“take a more critical and sceptical view”.—[Official Report, 20 February 2019; c 40.]

He is absolutely right that we need to be sceptical about things. That is why we also need to be realistic.

I will not be supporting Alex Rowley’s amendments. I understand why he lodged them and I see what he is trying to achieve, but we must produce law that is achievable.

Alexander Stewart

Members of the committee have made some valid points this morning. Setting a target always sets out an ambition, but that is not always realised. As we have heard today, we all want to do as much as we can to tackle fuel poverty—it is an issue that none of us takes lightly. However, to be realistic, we must consider all the options.

I acknowledge that Mr Rowley lodged his amendments with the best of intentions. However, it will be very difficult to achieve that target and we should not set ourselves up to fail—as could be the case. The interim target that has been discussed is potentially the best way forward. It is a stepping stone—a location from where we can see how we are progressing.

We have already heard about the external circumstances that are not within our control and that may have an impact on the issue. Those have to be taken into account. If we are to be realistic about what we are to achieve, we cannot ignore those potential dangers and warnings from the sector, which may not support what we are trying to achieve.

As the stage 1 report indicated, at the end of the day, we are all very passionate about the process. That has not changed. We are still passionate about trying to do as much as we can. However, we must do so within the limitations of our situation and realistic timescales—2040 would give us that opportunity. An interim target would also give us the opportunity to see where we are going.

I, too, cannot support Alex Rowley’s amendments.

The Convener

I agree with Graham Simpson that everyone is entitled to have a slightly differing opinion or to change their mind following the stage 1 report, but I find it strange that on one of the most important issues, on which we had a lot of debate, some members have changed their minds totally. Having said that, I have no doubt at all that Alex Rowley lodged amendment 53 with the best of intentions and is trying to push us forward to help us bring about the end of fuel poverty as quickly as we can.

Alex Rowley commented that the fact that the first target was missed under the previous Administration was a reason for us to bring an earlier target here, but I would say the opposite. Missing that target was such a disappointment to so many people that we would not want to do it again. It also highlighted the problems that we have in trying to achieve such a target, because we lack the full range of powers. Like any country, we have to wait and see what happens with oil prices and all sorts of other things. It is important that we set a target that people respect and can trust.

Annabelle Ewing mentioned the new technologies, but there is more to it than that. Some things take time, such as behavioural change and education about how people use technology. One of the witnesses—perhaps from Argyll and Bute Council—talked about the fact that behavioural change will take time. They said that they will have to have boots on the streets and people chapping doors to make sure that they start to get people educated about the best way to change their behaviours and not use heating unnecessarily.

Alex Rowley made a valid point about his constituents, but as Annabelle Ewing quite rightly said, it is not as if we will be waiting until 2040 before we do anything. Instead, the hope is that, by the time we get to 2040, everything is resolved as best as it can be.

Clearly, I will not be supporting amendment 53, although I appreciate the reasons why Alex Rowley lodged it.

11:00  
The Minister for Local Government, Housing and Planning (Kevin Stewart)

This has been a good debate. As members know, I am against the change. I strongly urge members to vote against Alex Rowley’s amendments, but I recognise that they have been lodged with the best of intentions.

At stage 1, the committee accepted that it was better to have realistic and achievable targets that all involved could work towards. The committee asked the Government to amend the bill to include interim targets, and we have done so in respect of 2030. I am more than happy to continue to discuss with members other aspects of interim targets in the run-up to stage 3, but I appeal to them to ensure that any such targets do not come too early in the process, because we would not get very much out of them.

As the committee is well aware, we do not have all the powers that we need over the drivers of fuel poverty, particularly over energy prices; as a result, our action has to be taken using the powers that we have. For example, we are tackling fuel poverty by going for transformational change in homes through energy efficiency measures. That will rely on technologies, some of which are still being developed; a skilled workforce; and local companies to take forward the work.

The target date has to be agreed by the partners who will bring about the change: the businesses that will take the work forward, COSLA and, of course, those who own homes, such as home owners, private landlords and registered social landlords. Those sectors do not want the target to be changed in a way that will set everyone up to fail; instead, they want to work towards a target that can be achieved.

Moreover, the amendments, if accepted, would require our energy efficient Scotland programme to be accelerated, and I have not yet seen an alternative to the comprehensive route map. Let me just mention a few of the risks of such acceleration. First, it could lead to investment in existing technologies that might need to be replaced, perhaps in the very near future, and we must look at that properly if we are to reach and meet our climate change targets.

Graham Simpson

Can you clarify the phrase

“technologies that might need to be replaced”

so that people understand what you mean? I assume that you are talking about, for example, boilers in people’s homes.

Kevin Stewart

Absolutely. Mr Simpson has nailed it completely. We might well decide to replace gas boilers, only to find that we have to quickly replace them again to meet our climate change targets. In his earlier remarks, Mr Rowley talked about a joined-up Government approach. That is what we have tried to do in this bill, in the climate change bill that will come before the Parliament very soon and in energy efficient Scotland. By taking that path, we have taken account of all the pieces of the jigsaw in order to get this right. As I said, Mr Simpson is absolutely right in his assumption.

Other risks include the loss of economic opportunities from developing skills in the supply chain across Scotland, which could support 4,000 jobs. At the moment, only larger businesses outwith Scotland would be ready to match any accelerated pace.

I also point out the risk of inflationary pressures. If demand exceeded supply, corners could be cut and costs could escalate, which would result in higher public spending or, indeed, increased rents if costs needed to be met by landlords.

There is also a risk of alienating the public, because cutting eight years from the target would mean speeding up the pace of regulation and enforcement. We have committed ourselves to a phased approach to maximise the take-up of energy efficiency improvements voluntarily up to 2030, with mandatory action to follow. Bringing the target forward would mean taking mandatory action by around 2024. That is not enough time to work with the public and bring people with us on all these issues. Moving too quickly might alienate the public and not allow individuals and families to plan their own actions.

Of course we want to go faster—I want to go faster—if that is possible. That is why we have started our consultation on the effects of speeding up the programme. However, we cannot move faster if doing so risks the credibility of our actions or leads to people paying out more through the public purse or other means.

Mr Gibson highlighted the concerns that have been raised by COSLA, which pointed to the damage that could be done if unrealistic targets are set—it even said that it would be “callous” to do so. As COSLA noted, if the improvements that are required result in increasing more than the achieved savings in fuel costs, all that we will have done is to replace fuel poverty with poverty. We must have a realistic starting point for the target that is within our grasp and which we can strive for. Aiming for 2032 is unrealistic and unachievable before we have even started. It flies in the face of all the concerns that I have set out, and of the considered opinion of the committee in its stage 1 report.

Changing the target date risks the Parliament losing credibility on tackling and eradicating fuel poverty. I therefore urge the committee to reject the amendments, which no partner that needs to deliver the 2040 target agrees with.

Alex Rowley

The minister refers to the risk of Parliament losing credibility on tackling fuel poverty, but one would have to assume that such credibility exists at present. I am not sure that it does.

The minister talked about energy efficiency improvements, around which there are a number of myths. There is the myth that Annabelle Ewing talked about, which is that somehow we are just waiting on the technologies, and they will come at some point. I talked about specific cases, particularly the older lady up in Ballingry. She was not in a council house; she was in a bought house, and so were most in her street. When works were being done in Ballingry, they got an offer to insulate their houses. The minister knows about the case, because I have corresponded with him about it. The people got an offer of £600 to insulate their houses and they all handed over the £600. They then discovered that the Stuart metal-framed housing was more expensive to insulate properly. As a result, those people are sitting in fuel poverty, not because the technology does not exist but because it is more expensive and there is not enough funding.

If we are going to be ambitious, we must accept that part of that ambition should be to bring forward more resources. Kenneth Gibson rightly asked me where those resources would come from. I do not want to get into the politics of it but I am quite sure that, if my party was in government in Westminster, over 10 years there would be £47 billion of capital investment coming to Scotland. That is the level of investment that we need to see in housing and other infrastructure across Scotland. It is a myth to say that fuel poverty is all down to new technology. For the people who are in fuel poverty now and need energy efficiency improvements, the problem is the lack of funding.

I know that that will come forward in the strategy, the financial memorandum and the commitment to finance alongside that. If we set a more ambitious target, there is more likelihood of getting more resources to deliver. If we are not ambitious, we will not have the resources to deliver.

I turn to being realistic about what is achievable. The minister almost gave a list of reasons why we will probably never tackle fuel poverty—Brexit, fewer workers, a shortage of workers, and a shortage of skilled workers. That all has to be part of the strategy, but I do not think that it will take until 2040 to put it together. I am not convinced that the people of Scotland will be impressed that we are setting yet another fuel poverty target, which is for 2040; by then, I will be in my 70s and lots of people in Scotland who are living in fuel poverty today will no longer be living.

The issue is whether we have the will, the commitment and the drive to put in the resources to make this happen. It seems that SNP and Conservative members will team up to put off the target into the future; I think that that is sad. We need to be ambitious, and this Parliament needs to be ambitious—

Kenneth Gibson

May I ask where this dissent is coming from? I did not hear all this rhetoric when we debated the stage 1 report; I heard not one word of all this stuff. The member agreed with us about what we should do and what target should be set. He referred to £47 billion over 10 years for Scotland, which is pie in the sky—it is fantasy stuff. We are trying to deliver realistic policies for real people in Scotland at this moment in time, not for some potential UK Government that may or may not have resources to invest at some point in the future. That is where we are.

Alex Rowley

With the greatest of respect, Kenneth Gibson has today set out a load of excuses as to why we cannot do this. You have to dispel those myths about the key drivers. A key driver is poverty, and COSLA says that we would drive more people into poverty—I do not know where that comes from.

Consider the unacceptable increase in the level of child poverty in Scotland. An argument that is growing is being made by civic Scotland and the “Give me five” campaign: 30,000 children would be lifted out of child poverty if child benefit was increased by £5 a week. That would sit within the powers of this Parliament, so it is wrong to say that we do not have any influence over the key drivers.

Annabelle Ewing

Would the member—

Alex Rowley

I want to respond to Kenneth Gibson’s other point, which was about the committee’s report. I have listened to the evidence to this committee; I have also spoken to Citizens Advice Scotland, met Energy Action Scotland, listened to the rural and islands housing associations forum and East Ayrshire health and social care partnership and met the Existing Homes Alliance Scotland. They all say that the target is not ambitious enough and that we need to be more ambitious, with the flexibility to shift the target if need be.

Let us be ambitious for Scotland. Let us say that fuel poverty in Scotland is not acceptable and earn our crust by doing everything that we can to eradicate fuel poverty and bring the target forward.

I will conclude at that, convener. I press amendment 53.

The Convener

The question is, that amendment 53 be agreed to. Are we agreed?

Members: No.

The Convener

There will be a division.

For

Wightman, Andy (Lothian) (Green)Rowley, Alex (Mid Scotland and Fife) (Lab)

Against

Stewart, Alexander (Mid Scotland and Fife) (Con) Simpson, Graham (Central Scotland) (Con) Gibson, Kenneth (Cunninghame North) (SNP) Ewing, Annabelle (Cowdenbeath) (SNP)Dornan, James (Glasgow Cathcart) (SNP)

The Convener

The result of the division is: For 2, Against 5, Abstentions 0.

Amendment 53 disagreed to.

The Convener

Amendment 3, in the name of Graham Simpson, is grouped with amendment 2.

Graham Simpson

I suspect that this will be slightly less contentious. Members can see amendment 3, but I thought that it might be useful if I read out how section 1(1) would look if amendment 3 were agreed to:

“The target is that in the year 2040, as far as reasonably possible no household in Scotland is in fuel poverty and, in any event, no more than 5% of households in Scotland are in fuel poverty.”

It should be clear enough to members that the purpose behind the amendment is that we do not want to say that our ambition is just 5 per cent. We want to go beyond that. It is a simple amendment that will clear up possible confusion and perhaps deal with the ambition that Mr Rowley wants to insert into the bill.

I move amendment 3.

11:15  
Andy Wightman

Amendment 2, in my name, is a straightforward amendment. Notwithstanding Graham Simpson’s amendment 3, which proposes to alter the target, according to the “Oxford English Dictionary” the word “eradication” means

“the complete destruction of something”;

it means getting rid of something completely. The target is 5 per cent, which is therefore a reduction from the current rate of fuel poverty, so it is a simple question of language that would reflect more accurately the purpose of the bill.

Annabelle Ewing

Mr Simpson’s amendment picks up on the discussion that we had at stage 1; I am happy to support it on that basis.

I also recall discussions on the point that Mr Wightman’s amendment makes. Language is important in sending signals, but I feel that Mr Wightman’s approach would not send the best signal. We want to send the signal that we are absolutely determined to tackle fuel poverty in Scotland. That is our ambition and—picking up on the previous debate—we want to move as quickly as we can. However, we need to be realistic and not cynically and unnecessarily get people’s hopes up. We want to do the right thing and work together according to a route map, as we have just agreed to do.

In that context, it is important to retain the ambition. I worry that Mr Wightman’s amendment might detract from that. It is, perhaps—to an extent—a semantic issue. As a matter of practicality, it must be recalled that people move in and out of fuel poverty. In the future, there could be very dramatic circumstances—perhaps beyond the control of this or any Government—that could result in that happening on a significant scale. I think that Mr Wightman and I had an exchange on that in the stage 1 debate; as I said then, the Scottish Parliament does not control the key drivers of fuel poverty, including—to name but a few—household income, macroeconomic policy, income tax personal allowances, tax exemptions, value added tax, or 85 per cent of the value of social security payments. Sadly, one could go on and on.

Andy Wightman

I do not intend to address that latter point, which we rehearsed at stage 1, but Annabelle Ewing talked about the danger of changing the ambition of the bill. The long title is not really about ambition; the ambition is embodied in the sections of the bill. The long title should reflect what the bill says. The bill does not make any provision for the eradication of fuel poverty; it makes provision for a reduction to 5 per cent. It is not a question of whether there should be more or less ambition.

I understand Ms Ewing’s point about the importance of language, but the importance of language in the long title is to reflect accurately what the bill intends to do.

Annabelle Ewing

I hear what Mr Wightman says, and he has made that point on a number of occasions. However, if we took his approach, there is a risk that we would send a signal—which is really important—that we are limiting our ambition. We are not limiting our ambition; all committee members are very ambitious to tackle fuel poverty, but I fear that Mr Wightman’s approach would muddy the waters and not send the correct signal. Therefore, I will not support Mr Wightman’s amendment.

Kevin Stewart

I am happy to accept Mr Simpson’s amendment, but not Mr Wightman’s. The bill’s target is for

“no more than 5% of households”

to be in fuel poverty in the year 2040. I stress the words “no more than”, because I feel that they are sometimes forgotten. Five per cent is a maximum, not a minimum; our long-term ambition is that no household should be in fuel poverty. The target is 5 per cent not because we are reluctant to go any further, but because we do not control all the drivers of fuel poverty—again, particularly energy prices.

Getting to 5 per cent is realistic, credible and deliverable by 2040, but we will always strive to do better. However, people’s circumstances change and they can move in and out of fuel poverty, as Ms Ewing highlighted. For example, a huge increase in fuel prices could move someone into fuel poverty, as could personal economic shocks. However, 5 per cent is not the limit of our ambition. Our long-term goal is the eradication of fuel poverty. I was pleased that the committee endorsed that position in its stage 1 report. The 5 per cent target in the bill both relates to and contributes to achieving that ambition.

Mr Simpson’s amendment serves a useful purpose. It will strengthen the bill’s target, so that

“in the year 2040, as far as reasonably possible no household ... is in fuel poverty”.

Importantly, it will not remove the 5 per cent target but rather will draw out the full intent behind our 2040 target. That is why I support it.

Mr Wightman’s amendment would substitute the word “reduction” for the word “eradication” in the long title of the bill. The long title states what our fuel poverty act will do, which includes setting

“a target relating to the eradication of fuel poverty”.

I believe that our 5 per cent target is entirely compatible with that description and will be even more so if the committee supports Graham Simpson’s amendment. Mr Wightman’s amendment would dilute, and detract from, that long-term ambition to eradicate fuel poverty, which is why I cannot support it.

Therefore, I urge the committee to support Mr Simpson’s amendment but reject Mr Wightman’s.

Graham Simpson

Thank you for all the comments. The minister has summed up very well that, if the committee is minded to accept my amendment, we will be saying that we are trying to ensure that nobody in Scotland is in fuel poverty, which is our aim.

If that is accepted, it is clear that the word “eradication” in the long title is also accepted, because that is what we are trying to achieve. In any case, the long title only says that it will be

“An Act ... to set a target relating to the eradication of fuel poverty”.

I am surprised that Andy Wightman, of all people, has tried to water that down and I will not support his amendment. Clearly, I will support my own amendment.

Amendment 3 agreed to.

11:23 Meeting suspended.  11:30  

On resuming—

The Convener

Amendment 15, in the name of Kevin Stewart, is grouped with amendments 16, 24, 25 and 38. I invite the minister to move amendment 15 and to speak to all the amendments in the group.

Kevin Stewart

The amendments will improve the bill and are in line with the committee’s stage 1 recommendations, so I urge the committee to support them. They mean that we will have in the bill a definition of extreme fuel poverty and of the fuel poverty gap, as well as new, challenging targets for them. Putting those additional targets on the same statutory basis as the overall fuel poverty target will bring a focus on those who are deepest in fuel poverty and ensure that the fuel poverty strategy will help those who are most in need and not those who are easiest to help.

The test for establishing whether a household is in extreme fuel poverty will be the same as the two-part test for fuel poverty that is in the bill. However, to be in extreme fuel poverty, a household will need to spend more than 20 per cent of its net income, after housing costs, on fuel, rather than more than 10 per cent.

The second part of the test remains the same: that that spending on fuel must leave the household with insufficient income to maintain an acceptable standard of living. Setting the target in the bill that, in the year 2040,

“no more than 1 per cent of households are in extreme fuel poverty”

clearly demonstrates our commitment to prioritising those who are worst off and indicates that we will not tolerate extreme fuel poverty. It is a realistic target that takes account of people who might move in or out of extreme fuel poverty temporarily, due to circumstances beyond the Scottish Government’s control, such as fuel prices or personal economic circumstances.

The fuel poverty gap measures not only whether a household is in fuel poverty, but how far away it is from the 10 per cent threshold, or from reaching the minimum income standard threshold. The target will require that our strategy does not leave behind those who need help the most. We know that in 2015 the median gap was almost £650, so achieving the 2040 target of £250 will substantially reduce the severity of the fuel poverty that households experience.

The achievement of the targets will improve many people’s lives considerably. The smaller the proportion of net income that they have to spend on fuel, the more they will have for other essentials of daily life.

By adding statutory targets for extreme fuel poverty and the median fuel poverty gap to the existing fuel poverty target in the bill, we will ensure that future efforts leave nobody behind.

I therefore urge the committee to support all the amendments in the group, and I move amendment 15.

Annabelle Ewing

The minister’s comments and amendments are welcome, because the committee asked the Government to address those issues at stage 1. We heard evidence from a number of stakeholders, including the Wheatley Group, the Scottish Federation of Housing Associations, the Existing Homes Alliance Scotland and others, that were concerned to note that in the bill, as first published, there was no definition of extreme fuel poverty. We also heard concerns that, absent such a definition, there would be a risk of efforts being targeted at low-hanging fruit, even if the overall target was ultimately met. That might leave a disproportionate number of those with the most critical needs in the final 5 per cent of households that would continue to face fuel poverty by the 2040 target. I am very pleased indeed that the minister has listened to the committee and come forward with amendments on this important issue. I am happy to support the amendments.

Kenneth Gibson

I concur with those comments. This issue is important. As you will be aware, minister, a significant proportion of people live in extreme fuel poverty, particularly those with rural, hard-to-heat homes. The proposal is an excellent way to ensure that we do not end up in a situation in which the people who are in the deepest fuel poverty at the moment remain so many years from now. It is important that all groups in society benefit equally from the bill. You will be familiar with the phrase, “low-hanging fruit”. We have raised the issue that we are discussing on a number of occasions, and we want to ensure that everyone has equal access to the opportunity to have their fuel poverty reduced. I very much endorse what you and Annabelle Ewing have said.

Graham Simpson

As I have done before, I praise the minister for the way in which he has engaged with the committee on our recommendations, particularly the one that we are discussing now. It is important that we tackle the issue of people who are living in extreme fuel poverty. What the minister has said is most welcome. The issue has been raised by a number of people and organisations, including the Scottish Federation of Housing Associations, the Wheatley Group, the Highlands and Islands housing associations affordable warmth group and the Existing Homes Alliance Scotland. Again, I welcome what the minister has brought forward, and we will support the amendments.

The Convener

I invite the minister to wind up.

Kevin Stewart

I thank the committee and other stakeholders for expressing their views on this issue and for co-operating with the Government to come up with the amendments that we are dealing with just now.

Defining extreme fuel poverty and setting ambitious targets to tackle it sends a clear signal that we are absolutely committed to dealing with the worst first. I have heard the committee and others talking about going for the low-hanging fruit first. We know that that should not be the case, and the amendments in the group will ensure that we are dealing first of all with those folks who are in the most extreme fuel poverty.

No one should have to choose between heating and eating. For those who experience that, tackling this problem and keeping them warm and comfortable in their homes is likely to have much wider benefits to their lives, and could possibly improve their health and education. Further, it has a huge benefit to our society.

By adding these statutory targets for extreme fuel poverty and the median fuel poverty gap to the existing fuel poverty target that is in the bill, we will ensure that future efforts do not leave anyone behind.

Amendment 15 agreed to.

Amendment 16 moved—[Kevin Stewart]—and agreed to.

The Convener

Amendment 5, in the name of Graham Simpson, is grouped with amendments 4, 7, 6, 10, 9, 12, 11, 14 and 13.

Graham Simpson

This suite of amendments reflects the view, expressed in the committee’s stage 1 report, that the 5 per cent target should be met in all council areas across Scotland.

There are a couple of things to say about that. If you say to councils that they should be responsible for achieving the 5 per cent target in their areas, that is potentially extremely onerous for them. It is no wonder, therefore, that we have had some pushback on the proposal, because that is what they thought that the intention was.

My amendments do not say that; they would place the onus on the Scottish Government to ensure that the target is met in each council area. That is not the same as putting the onus on councils. It is saying, to go back to that phrase “low-hanging fruit”—[Interruption.] Sorry, convener, but I am being distracted slightly.

The Convener

Excuse me—

Annabelle Ewing

Sorry.

Graham Simpson

Thank you, convener.

If we do not agree to the amendments, there is a danger that the easiest to target areas will be picked and the less easy areas will be left. The intention behind the committee’s recommendation is to deal with that issue.

I will go through the amendments. Amendment 4 says that

“Ministers must ensure that the 2040 target is met in each local authority area.”

Ministers would then have to set out the approach that they intend to take to ensure that the target is met and say what steps have been taken to meet the target in each council area. Ministers would then have to say what progress has been made on meeting the target. Finally, ministers would have to say what steps they propose to take in the next reporting period to meet the target in each council area.

Clearly, the onus would be on ministers, which is the important thing. I hope that COSLA can be reassured—I see the minister laughing, so perhaps it will not be—that the intention behind the amendments is not to inflict more burdens on councils; it is to ensure that we get a uniform picture across the country in trying to deal with this important issue.

I move amendment 5.

Andy Wightman

I have sympathy with the amendments in the group, but I cannot support them, as I have a number of problems with them. In the first suite of amendments, which are 5, 4, 7 and 6, the phrase “must ensure” is used. However, as far as I am aware, nowhere else in the bill is there language that ministers “must ensure” that the national target is met. That is because, clearly, although ministers of all Administrations up to 2040 will use their best endeavours, it is hard to see how they could be held to a mandatory obligation to ensure that the target is met. I therefore have difficulty with that language.

I also have difficulty with the fact that the amendments cause local authorities concern. Notwithstanding that it would, as Graham Simpson said, be the Scottish ministers who “must ensure” that the target is met, local authorities inevitably feel that, for those areas with high levels of fuel poverty—perhaps they will be disproportionately high as we move forward—the local authority’s scope for making choices about how to reduce fuel poverty and spend its money will be compromised. That is because ministers may well put pressure on local authorities to meet a target that ministers have to ensure is met, even though it is substantially up to local authorities to in fact meet it.

I have fewer problems with the amendments to section 6, on periodic reports from ministers. It would be helpful if those periodic reports reflected what ministers have done and propose to do in each local authority area. However, that is probably beyond the scope of the periodic report as set out in the bill. Local authorities have their responsibilities for reporting and publishing plans, so I do not feel that those amendments would add a great deal to the bill.

Finally, as the minister made clear in response to a question that I put to him when he gave evidence to the committee on the minimum income standard for remote rural areas, and as has been made clear through the reporting to date on fuel poverty, the fuel poverty rates across the country can, and I imagine will, be reported local authority by local authority—indeed, we have that data.

I would like to see it reported according to the urban/rural classification. In fact, there is no reason why the data could not be reported in relation to any geography that we wish—obviously, it could not be reported for very small geographies, but it could be reported for any other geography, such as each health board area. That reporting would highlight where progress was and was not being made. For example, we know that fuel poverty rates are still unacceptably high in Orkney.

In my view, that should be sufficient to create circumstances in which ministers and local authorities work hard to ensure that local authorities in whose areas fuel poverty rates remain stubbornly high have the resources and tools at their disposal to be able to bring them down. Essentially, I believe that the reporting will be sufficient to take account of any concerns that exist, and it is a legitimate concern that we may have a multispeed approach to eradicating fuel poverty, with rates in some local authority areas remaining stubbornly higher than those in others.

11:45  
Kenneth Gibson

I strongly support amendment 4. I think that it follows on from amendment 3, because if we are looking at a target of 5 per cent for Scotland, how do we make that into a target of 5 per cent for every local authority area? We do not want situations such as exist in Orkney, where some 57 per cent of people are in fuel poverty.

I do not believe that the burden should or will fall on local authorities to reduce the levels. I would expect the Scottish Government, when it allocates resources for eradication of fuel poverty, to do so on a pro rata basis so that all local authorities can meet the target. There would be no point in giving every local authority similar amounts per capita, for example, when the problem is much more acute in some areas than it is in others.

Amendment 4 would make the direction of travel clear and allow the Government the flexibility to dedicate its resources to ensure that Liam McArthur’s constituents and my island constituents are not disproportionately burdened by fuel poverty for years to come. Again, I refer to the old adage about low-hanging fruit. We want to make sure that we are addressing the issue across the board in every community and every local authority, whether people are in extreme fuel poverty or not. Amendment 4 will help us to do that.

Annabelle Ewing

The subject was an important aspect of the evidence that we took and, at stage 1 at least, the committee agreed unanimously that there should be recognition that the 2040 target must be met in each local authority area. For reasons that have already been stated, that is entirely right and proper. If we were not to proceed with that approach, there would be a real danger that some would be left behind. That point was made by Argyll and Bute Council, which stated that, with a blanket nationwide target, there would be a risk that

“householders in remote and rural areas will be disproportionately represented in the residual 5%; and will still be in fuel poverty even if this target is met.”

The bill is for the whole of Scotland including our islands, our remote communities and our urban areas. It is for everybody, and nobody should be left behind.

We are still to hear from the minister, but as the committee said in its stage 1 report, it is good to hear in the debate recognition of

“the Minister’s commitment to ... work with local authorities to consider how best to distribute schemes to balance ... requirements”

and to meet needs. Perhaps we will hear a bit more about that shortly, but I am happy to support amendment 4 on the basis of the 2040 target, and those of Mr Simpson’s amendments that relate to the 2040 target, which is what we have agreed in the first group of amendments this morning.

Liam McArthur (Orkney Islands) (LD)

Having been named and shamed by Kenneth Gibson, I thought it pertinent and probably advisable to contribute, albeit only briefly to endorse the comments that Annabelle Ewing and Kenneth Gibson have made. I think that there is a risk in trying to put in place an overly onerous requirement on local authorities or the Scottish Government. I think that the way that amendment 4 is phrased strikes the right balance.

The trajectory for getting to the target will be different in each area, according to where the area currently stands and the local circumstances, but it will be seen as a failing if we get to 2040 and there is still a wide disparity between the best and poorest performing local authorities. As I have said, amendment 4 strikes the right balance in terms of achieving the objective.

Kevin Stewart

The committee and I agree that fuel poverty needs to be tackled in every community throughout Scotland, but to do that, we must not leave behind the people who are in the most challenging circumstances. As a result, we have lodged amendments that will introduce additional targets on the median fuel poverty gap and extreme fuel poverty, which are intended to reduce the severity of the fuel poverty that is experienced in all areas of Scotland—whether it be Orkney, Arran or Aberdeen—and that we focus not just on the households that are easiest to raise out of fuel poverty.

I know that at stage 1 the committee said that we should consider amending the bill to introduce local authority statutory targets, and in my response, I said that we would need to seek COSLA’s views, given the implications of such an amendment for Scotland’s councils. COSLA has since made clear to me and the committee a “series of concerns” that it has about the amendments. Equally, I have had strong representations on this issue from Graham Simpson with regard to his amendments, and from my own party colleagues, in particular Kenneth Gibson, and I am aware of the balance that I need to strike between the views of Scotland’s local authorities and those of Parliament.

Following my conversations and the committee’s original recommendation, I think that it is clear that the committee would like to apply a 2040 target at local authority level to ensure that reporting and accountability take place in each council area. I confirm, therefore, that I will support Graham Simpson’s amendments, which provide for a 2040 target, although we might need to consider whether they need to be refined slightly at stage 3, not least because—as I understand it—local authority statistics are not available quite as quickly as national ones. That said, I am happy to work with Graham Simpson on that, in advance of stage 3.

I also want to emphasise that such targets make it vital that the Scottish Government work closely with COSLA and individual local authorities in order to focus on delivery. When I talk to councils about fuel poverty and energy efficiency, they consistently emphasise the need for local flexibility, so we have already made some changes in that respect. I want to ensure that it is all possible—especially the requirement to set out the steps that will be taken locally to address fuel poverty. By having a national target as well as local targets, we can tailor our approaches and ensure that no one is left behind. I therefore support Graham Simpson’s amendments relating to the 2040 target.

Graham Simpson

Once again, I thank committee members for their contributions. It was particularly good to get the islands perspective not just from Liam McArthur but, of course, from Mr Gibson, who has spoken extensively in this committee about the islands in his constituency.

In delivering the targets, we must not miss anyone out. That is the intention behind the suite of amendments that we will be voting on; amendment 4 relates to the 2040 target and amendment 5 deals with the 2032 target, which we have already rejected. I am always prepared to speak to the minister if he feels that anything needs to be refined, because this is about making good law that works for everyone—in particular, councils. I would be happy to have those conversations.

The Convener

Can I clarify the situation with amendment 5?

Graham Simpson

I will not press amendment 5.

Amendment 5, by agreement, withdrawn.

Amendment 4 moved—[Graham Simpson].

The Convener

The question is, that amendment 4 be agreed to. Are we agreed?

Members: No

The Convener

There will be a division.

For

Stewart, Alexander (Mid Scotland and Fife) (Con) Simpson, Graham (Central Scotland) (Con) Rowley, Alex (Mid Scotland and Fife) (Lab) Gibson, Kenneth (Cunninghame North) (SNP) Ewing, Annabelle (Cowdenbeath) (SNP)Dornan, James (Glasgow Cathcart) (SNP)

Against

Wightman, Andy (Lothian) (Green)

The Convener

The result of the division is: For 6, Against 1, Abstentions 0.

Amendment 4 agreed to.

The Convener

Amendment 54, in the name of Alex Rowley, on the Scottish fuel poverty advisory group, is grouped with amendments 93 to 95.

Alex Rowley

Thank you, convener.

The purpose of amendment 54 is to allow the target year to be changed, on the recommendation of the Scottish fuel poverty advisory panel. I intend to move the amendment, but I accept that changes will need to be made at stage 3, because the amendment reads

“advising that the target will not be met.”

That was to link it to my first amendment—amendment 53—to move the target to 2032. However, the same principle could apply if the advice of the advisory panel was that it believed that we were making good progress and could shift the target the other way. I accept that the wording of amendment 54 needs to be tidied up, but if the advisory panel feels that we can reach the target sooner or later, depending on the issues, being able to move the target will be right.

I move amendment 54.

Andy Wightman

I will speak to amendments 54 and 93.

Amendment 4 is incredibly helpful. I make the proviso that I was content with and had agreed to changing the target to 2032, but amendment 53 has obviously been rejected. In the light of that, the language at the end of amendment 54 will need to be modified, because if in 2025, 2026, 2027 or 2028 it is felt that we could bring the target forward, that will need to be reflected in the legislation. I will support amendment 54.

Amendment 93 is critical. It is the view of the committee that we need more effective scrutiny, not just of the Government’s reports under section 6 of the bill, but of the likelihood of a target being met or missed, and of the extent to which the four drivers of fuel poverty are being addressed. Setting up independent scrutiny is always an issue in bills.

I am not a supporter of setting up a bureaucratic organisation using lots of resources, so I note that proposed new subsection (9) in amendment 93 would cap the finances that are available to the advisory panel. The job of the panel would be to provide a probably brief but considered and well-informed report to inform Parliament about the validity of what is said in the Government’s section 6 report, and to take a view on the likelihood of the target being achieved. With the best will in the world, any Administration would want to say that the target will be achieved, so independent analysis of that will be extremely useful.

Subsection (11) of the proposed new section refers to the

“four drivers of fuel poverty”.

Of course, incomes are not a driver, although they are an influence. Net adjusted incomes are a driver, and they are arrived at after taking account of factors that are well within the Parliament’s control.

In a similar vein, energy costs should relate to households, and energy performance should relate to dwellings. The language in amendment 93 requires to be tidied at stage 3, but with that in mind, I am happy to support all the amendments in the group.

12:00  
Annabelle Ewing

On the basis of what Alex Rowley has said, I am happy to support the amendments in the group. My wee caveat is that I expect amendments with language that is in line what he described to be lodged at stage 3.

As I have said before in committee deliberations, while thinking of setting up a panel on this or any other area of activity, we must remember that resources are not endless and that the priority is always to put resources to the front line. However, I recognise that the proposed advisory panel would have a job of work to do. As long as it does not cost the public purse a lot of money that could otherwise be spent on improving individuals’ existence in their homes, I will be happy to support amendment 93.

Graham Simpson

My comments about amendment 54 are similar. I am happy to support it, on the basis that Alex Rowley proposes to amend the wording at stage 3. We do not want the target to be pushed beyond 2040, which is a danger because of how the amendment is worded. With that proviso, I am happy to accept the amendment.

Amendment 93 needs a bit of work, not least because it refers to a 2032 target, which does not exist. Some tweaks will be required; if there is not time to make them next week, they will be needed at stage 3.

Kevin Stewart

Having considered the matter carefully, I am sympathetic to the concept of placing the Scottish fuel poverty advisory panel on a statutory footing. However, Alex Rowley’s amendment 93 needs the refinement that folks have described, because it is based on a 2032 target. If we are to have a statutory panel, it must be aligned to the 2040 target date.

I appreciate Mr Rowley’s proposed capping of costs. The costs of the Poverty and Inequality Commission are close to £400,000 a year; the advisory panel would need to have a secretariat and to go through the public appointments system, so we would need to build in a bit more than Mr Rowley has envisaged.

If the advisory panel is to be placed on a statutory footing, it should have powers to make recommendations, which would allow Parliament to revisit the target date. I am therefore content to support the principle of what Mr Rowley is trying to achieve. His amendments are proportionate and would improve the bill. However, I intend to lodge stage 3 amendments to align the advisory panel with the 2040 target date and to allow for more realistic expenditure, while keeping it within a cap that is close to what Mr Rowley seeks to achieve.

Alex Rowley

I am happy with all the responses and to discuss the proposal further with the minister. At stage 3, we can address the points that need to be addressed, but the principle has been agreed to.

Amendment 54 agreed to.

The Convener

Amendment 17, in the name of the minister, is grouped with amendments 18, 19, 26, 27, 29, 30, 33 to 35 and 40 to 44. I remind members of the eight pre-emptions in the group.

Kevin Stewart

My amendments are in line with the commitments that I have given during the passage of the bill and the committee’s recommendations. I urge members to support them.

I committed to including the two 2030 targets from the draft fuel poverty strategy in the bill. The targets are that, in 2030, fuel poverty will be no more than 15 per cent and the median fuel poverty gap will be no more than £350 at 2015 prices before inflation. That was the recommendation of the committee in its stage 1 report, where it stated that interim targets would

“enable comprehensive assessment of how well”

the fuel poverty strategy was

“working at its mid-point.”

The committee also recommended that the Government lodge amendments to include in the bill a target for tackling extreme fuel poverty. I committed to doing so, and I sent the committee a briefing on how we would take that recommendation forward. Amendment 18 will put a target in the bill that, by 2030, no more than 5 per cent of households should be in extreme fuel poverty, and that is part of my commitment to tackling extreme fuel poverty—as are the two other 2030 targets. My amendments represent a practical means of maintaining the momentum of the fuel poverty strategy through to the final target date of 2040.

Mr Wightman’s amendment 19 would set interim targets. However, setting interim targets so early in the programme would result in targets that were unachievable and would undermine the credibility of the strategy. Given the fact that the committee’s stage 1 report called for amendments to enshrine 2030 interim targets in legislation, I am a little bit surprised by amendment 19.

We must be realistic in our targets and work closely with our local delivery partners to demonstrate progress towards the target of no more than 5 per cent of households being in extreme fuel poverty by 2040. That means ensuring that we can take advantage of new technologies that provide people with the right solutions for their homes and improve their lives. We must not set unrealistic and unachievable targets for which we do not have a credible delivery plan and so risk failing to achieve them once again.

In a briefing for the committee, COSLA said that setting unachievable fuel poverty targets would be callous. In addition, the Government’s proposed amendments are in direct response to the committee’s recommendations in its stage 1 report. It is vital that we set interim targets that can be met; otherwise, we risk the public and those who need our help the most losing confidence in all of us.

I am more than happy to have further discussions about setting achievable interim targets, but I ask the committee to reject amendment 19, in Andy Wightman’s name, and to support the amendments in my name.

I move amendment 17.

Andy Wightman

I will not move amendment 19. It was framed in the context of a possible 2032 target that will not be in the bill. I am conscious that the text of amendment 18, in the name of the minister, more accurately reflects the provisions of the bill, such as the section on the meaning of the fuel poverty gap. That point is absent from amendment 19.

Is the minister open to discussing the possibility of an additional interim target, which would be set for between now and 2040? I am not precious about when it should be set for, but it would not be unreasonable to have two targets with a 20 to 21-year outlook.

Graham Simpson

I am pleased to hear that Andy Wightman will not move amendment 19, which was clearly related to the 2032 target. I fully support amendment 18, in the name of the minister. However, I go back to what I said earlier, which is that there should be an extra target. I do not know what that target should be, but I am open to having discussions with the minister about it. I agree with the minister that, whatever the target is, it should be achievable.

Annabelle Ewing

I am pleased that the minister has acted in accordance with commitments that he made. Of course, I would fully expect him to do so at all times, but it is pleasing, nonetheless, to note a politician actually doing what they said they were going to do.

I hear what Andy Wightman says, and I note that he will not press his amendment 19. I understand the context in which he lodged the amendment, but the committee has agreed 2040 as the target date. In that context, the amendment does not fit with the interim target date of 2030 that is now proposed.

It would be interesting to hear about the possibility of a further interim target—I guess that we will hear from the minister on that shortly. That might be a useful way in which to proceed in the light of our initial discussion on the first group of amendments. I reiterate that we are all absolutely determined to tackle fuel poverty in Scotland.

The Convener

I do not think it is good for the reputation of politicians when a politician sounds surprised that another politician has kept their word.

Minister, will you wind up, please?

Kevin Stewart

I share your view on that, convener. I will keep this brief in the hope that you will allow a wee break for comfort purposes.

I am more than happy to meet Mr Simpson, Mr Wightman and any other member to talk about putting in play another interim target as long as it is viable and achievable, which I think everybody understands. I am more than happy to have those further discussions with both members and with any other member who wants to speak to me on the issue.

Andy Wightman

Will the minister take an intervention?

Kevin Stewart

I had finished, but I will do so if the convener allows it.

Andy Wightman

I am grateful to the minister for what he has said. For clarity, will he confirm that, in the light of the fact that we will probably be enshrining the interim target in amendment 18, amendment 54, which we have just agreed to and which says

“The Scottish Ministers may by regulations change the target year”,

should be amended at stage 3 to include any recommendations on changing the interim target?

Kevin Stewart

I will consider that point when I have had discussions with Mr Rowley and Mr Wightman.

Amendment 17 agreed to.

Section 1, as amended, agreed to.

Andy Wightman

On a point of order, convener. It is my understanding that we should also be considering amendment 55, which would amend section 1.

The Convener

Amendment 55 was pre-empted.

Andy Wightman

I beg your pardon, convener.

The Convener

That is okay. If our clerk, Peter McGrath, had not been here, I would not have realised that either.

After section 1

Amendment 18 moved—[Kevin Stewart]—and agreed to.

The Convener

We will have a very short comfort break.

12:13 Meeting suspended.  12:15 On resuming—  

Amendment 19 not moved.

The Convener

That brings us to the end of the meeting. I thank the minister for his time today.

12:15 Meeting continued in private until 12:17.  

Seond meeting on changes

Documents with the changes considered at this meeting: 

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Second meeting on changes transcript

The Convener

Our second agenda item is consideration of the Fuel Poverty (Target, Definition and Strategy) (Scotland) Bill at stage 2. Once again, I welcome Kevin Stewart, the Minister for Local Government, Housing and Planning, and his officials.

Some non-committee members have lodged amendments that will be considered today. I welcome Jackie Baillie to the committee; I expect other members to join us later.

The intention is to finish stage 2 today, if we can. If we are unable to do so, we will return to the bill after the Easter recess.

At the bill’s introduction, the Presiding Officer determined that a financial resolution was not required for the bill. Under rule 9.12.6C, the Presiding Officer determined that the costs that would be associated with amendments 48 and 62 would, for each, exceed the current threshold to require a financial resolution for the bill. Amendment 62 has, consequently, been withdrawn. Amendment 48 may be debated at stage 2, but cannot be agreed to in the absence of a financial resolution.

The Presiding Officer has also ruled that amendments 93, 21, 81, 84, 82 and 85 are cost-bearing amendments. However, the potential cumulative cost of the amendments would not require a financial resolution. As such, amendments 93, 21, 81, 84, 82 and 85 and any amendments that would be consequential on those amendments will be debated—if the debate on them has not already taken place—and the questions will be put on the amendments as normal at stage 2.

Section 2—Meaning of fuel poverty

The Convener

Amendment 99, in the name of Jackie Baillie, is grouped with amendments 56, 61,100 and 63.

Jackie Baillie (Dumbarton) (Lab)

I am an honorary vice-president of Energy Action Scotland, with my colleagues Murdo Fraser and Gillian Martin.

All the amendments in the group are in my name. Sharp-eyed members will remember amendment 62, which the Presiding Officer determined would cost about £1 million. I used the week between committee meetings to lodge amendments 99 and 100 in place of amendment 62.

Amendments 99, 56, 61,100 and 63 all deal with costs to be deducted when determining remaining adjusted net income in considering whether someone is in fuel poverty. Amendments 99 and 100 deal with disability.

I sought advice from the Scottish Parliament information centre on a more proportionate way of dealing with the issue. SPICe took advice from Professor Hirsch, who is known to the Scottish Government and the committee. Professor Hirsch told us that the Social Metrics Commission has done work on a new measure of poverty that uses, as an indicator of additional cost, the level of extra cost benefits in relation to attendance allowance, disability allowance and personal independence payments. That requires very little research and is, in effect—in Professor Hirsch’s words—“cost free”. All that is needed is for it to be built into the Scottish Government’s analysis in counting fuel poverty. I hope that it will no longer be seen as an impediment.

As the bill stands, the second part of the definition of fuel poverty includes childcare costs as part of the calculation. That is welcome; it is right that it does so. However, it will be inconsistent and a missed opportunity if the costs to a household of caring for an adult are excluded. We know from the Government’s statistics that carers experience a poverty rate of 22 per cent, and we know that poverty is also experienced by people with a range of disabilities. Both have a read-across to fuel poverty. We know that care costs have a real impact on household income. Care costs, whatever generation—child or adult—they are for, should be accounted for in the bill.

It is a simple group of amendments that I hope the committee and the Scottish Government will accept. I commend the amendments to the committee and note that they are supported by a wide variety of organisations, including the Poverty Alliance Scotland, the Coalition of Carers in Scotland, the Health and Social Care Alliance Scotland, Common Weal, Energy Action Scotland and many more besides. I hope that the committee will support the amendments.

I move amendment 99.

The Minister for Local Government, Housing and Planning (Kevin Stewart)

I will comment first on Jackie Baillie’s amendments 56, 61 and 63. At the committee’s meeting on 13 March, I was asked to respond to a list of proposed amendments to the bill that Energy Action Scotland had circulated to members. As I set out then, EAS neither sent us its proposed amendments nor sought meetings with me or my officials to discuss its views. Amendments 56, 61 and 63 are clearly based on the EAS proposal that the bill should be amended to deduct social care and childcare costs when calculating whether a household’s remaining adjusted net income is sufficient to maintain an acceptable standard of living.

I am unaware of any consultation having taken place on the proposals. None of the amendments forms any part of the recommendations that the committee made in its stage 1 report, and they offer no indication of what care costs would actually cover. As everyone knows, Scotland has free personal care and, as of this week, that policy applies to all adults who have been assessed as requiring such support, regardless of their income. That is a key reason why amendments 56, 61 and 63 are not required, so I urge the committee to vote against them.

I am pleased that Jackie Baillie has withdrawn her amendment 62—which was on a disability minimum income standard—because it would not have been possible to vote on it, and has lodged two new amendments. Amendments 99 and 100 represent a much better way of taking account of additional care costs, which provides another reason why amendments 56, 61 and 63 are not necessary. Ms Baillie’s amendments 99 and 100 would allow for deduction of relevant care and disability-related benefits when considering whether a household’s income is sufficient to maintain an acceptable standard of living, which I accept will result in a fairer comparison to the minimum income standard.

I am happy to accept amendments 99 and 100, but not the amendments that I spoke to earlier. The approach is in line with other evidence, such as that from the work of the Social Metrics Commission, which spent more than a year considering aspects of poverty measurement and concluded that deducting from available resources the value of the extra-cost disability benefits was

“the best available proxy for the extra inescapable costs of disability.”

The combination of that approach to disability benefits with our enhanced heating regime, and associated higher required fuel bills for households that are most affected by the adverse outcomes of living in a colder home, as well as our approach to free personal care in Scotland, will ensure that we are taking concrete action to tackle fuel poverty.

That said, we saw amendments 99 and 100 only at the end of last week, so the legal team needs to run further checks to ensure that they cover everything that is needed, such as all relevant disability benefits. However, I am assured that that process will result only in our needing to bring technical tidying amendments at stage 3, and will not change the policy objective. I therefore urge the committee to vote against Jackie Baillie’s amendments 56, 61 and 63 because they are unnecessary, particularly in the light of her new amendments 99 and 100, which we support.

Jackie Baillie

I intend to press all the amendments, although I am very grateful that the Government has accepted amendments 99 and 100. I want to make a couple of brief comments. In line with many other organisations, Energy Action Scotland engaged with the committee and made submissions to it. I raised some of the issues when the minister gave evidence at stage 1, when I helpfully came along, with the agreement of the convener. I therefore do not accept that the proposals have simply come at the last minute. It is likely that we will not have further primary legislation on the issue for a while, so this is a once-in-a-generation opportunity to get it right.

Therefore, I urge members to make sure that we put the provisions in the bill because I think that we all agree that—

I am sorry, convener—I see that a member of the committee wants to ask something.

Annabelle Ewing (Cowdenbeath) (SNP)

You said that you expect that there will not be primary legislation on the matter for some time. Could you clarify that point?

Jackie Baillie

The last fuel poverty target was set in the Housing (Scotland) Act 2001, so there has been a considerable period until there has been new legislation setting a new target. There will, of course, be secondary legislation. One would expect that; indeed, the bill invites it. However, 2001 was the last time a target was set in primary legislation. The target in the bill is to 2040, as I understand it, so it will be some time before we see new legislation. I am sure that Annabelle Ewing would accept that.

It is important to get the bill right and it is important to set out our intentions clearly. I will leave the committee with one thought, which is about care costs. Care costs are not just about free personal care; they involve free personal care, nursing care and hotel costs, and it is not the case that all those costs are met. We know from our constituents that care costs put a real burden on households; it is therefore important to ensure that that is clear and evident on the face of the bill. I hope that members think likewise.

Amendment 99 agreed to.

Amendment 56 moved—[Jackie Baillie].

The Convener

The question is, that amendment 56 be agreed to. Are we agreed?

Members: No.

The Convener

There will be a division.

For

Rowley, Alex (Mid Scotland and Fife) (Lab)

Against

Stewart, Alexander (Mid Scotland and Fife) (Con) Simpson, Graham (Central Scotland) (Con) Gibson, Kenneth (Cunninghame North) (SNP) Ewing, Annabelle (Cowdenbeath) (SNP)Dornan, James (Glasgow Cathcart) (SNP)

Abstentions

Wightman, Andy (Lothian) (Green)

The Convener

The result of the division is: For 1, Against 5, Abstentions 1.

Amendment 56 disagreed to.

The Convener

Amendment 57, in the name of Jackie Baillie, is grouped with amendments 58 to 60, 64, 96 and 97.

Jackie Baillie

I am grateful for the opportunity to move amendment 57 and to speak to the other amendments in the group. This is another relatively simple set of amendments. Amendment 57 deals with physical and mental impairment; amendment 58 deals with people of pensionable age; and amendment 59 deals with children under the age of five. The amendments set out quite clearly the eligibility for enhanced heating on the face of the bill.

I am starting from the premise that we want to capture all those who are likely to experience higher levels of fuel poverty than others. If we are to achieve the target of eradicating fuel poverty, it is important to include people with disabilities, pensioners and young children. The question is, as ever, whether that should be in the bill.

Amendment 57 covers disability. To quote from Inclusion Scotland’s submission to the committee,

“additional costs such as heating are higher because a much higher proportion of disabled people are unemployed and thus at home all day at a time when others reduce their heating. Although disabled people in employment face less additional costs they are still substantial and on average, across the UK, amount to £492 a month. It should be borne in mind though that the costs for a Scottish disabled person in work are likely to be higher again.”

Some disabled people also need more heat so as not to exacerbate their condition. I invite members to gaze outside to see the weather conditions that we are having in April to understand why additional heating may well be required.

Amendment 58 focuses on pensioners. As I understand it from the stage 1 debate, the Scottish Government’s position is to create a threshold of 75 years before allowing eligibility for enhanced heating. That misses the fact that older people experience a substantial drop in income at the point of retirement; many of them are on low and fixed incomes as a result of transferring to pensions. Also, people’s need for additional heating as they get older is well documented and amendment 58 is designed to reflect that practical reality.

I welcome the Scottish Government’s commitment to align fuel poverty and child poverty, but amendment 59 is needed to reflect the fact that children under the age of five are at a higher risk of fuel poverty than those over five. The Child Poverty Action Group points us to the World Health Organization and the Scottish Government’s independent academic panel, which note that families with young children are more vulnerable to the impacts of fuel poverty. They support the inclusion of all children, including those under five, in the eligibility criteria for enhanced heating.

The amendments are small, but they have the potential to make a huge difference. They are supported by a large number of charities, which in the interest of time I will not list.

09:15  

Amendment 60 properly gives ministers the power to modify the groups that are eligible for enhanced heating, because it is a high-level list and it is up to ministers to ensure that the list is fit and appropriate in the future.

Amendments 64, 96 and 97 set out the need to consult the national health service and patient groups, as they have expertise in and experience of the full range of relevant illnesses and conditions. Citizens Advice Scotland told the committee that there was a need to develop a specific list of health and disability categories, as well as age bands, which would help to identify those who are vulnerable to the adverse health and wellbeing impacts of living in fuel poverty.

I hope that the committee and the minister will support this group of amendments.

I move amendment 57.

Kevin Stewart

It is essential that the eligibility criteria for the enhanced heating regime are fair and appropriate and identify those households with a genuine need for higher temperatures and longer hours of heating. I am concerned that Jackie Baillie’s criteria are so wide that the enhanced heating regime could end up applying to more than 50 per cent of Scottish households, even though not all of them may need higher temperature heating for longer hours. That would devalue the enhanced heating regime. Therefore, I strongly urge the committee to vote against all the amendments in the group.

The bill provides for the eligibility criteria to be laid down in regulations following a consultation process. It is vital that we develop the criteria with stakeholders and, in particular, those with lived experience of fuel poverty, which is why determining the types of households for which the enhanced heating regime is appropriate is better done in secondary legislation. Putting the eligibility criteria in the bill, as amendments 57 to 59 would do, would not enable us to work flexibly with stakeholders to do that.

I will provide further detail. Amendment 57 would provide for a one-size-fits-all view of disability, rather than recognising the diverse needs in that group of people.

Graham Simpson (Central Scotland) (Con)

Would the affirmative procedure be used if the criteria were left to regulations?

Kevin Stewart

Indeed. The affirmative procedure would be used.

Not everyone with a physical or mental impairment requires additional heating for longer hours in the home.

Amendment 58 would apply the enhanced heating regime to all those of pensionable age. However, folks are living longer and healthier lives and working longer, too. Becoming a pensioner does not automatically imply vulnerability to the cold and a need for higher household temperatures for longer hours. The independent academic panel that reviewed our fuel poverty definition in 2017 agreed with that assessment, as did the committee in its stage 1 report.

Amendment 59 relates to households with a child under five needing higher temperatures for longer hours, but there is no medical evidence to convince us that that is the case. In fact, having higher temperatures for longer hours is inconsistent with established NHS guidance.

The regulation-making powers in section 2(4) provide us with the flexibility to review definitions and criteria if any evidence in the future deems that to be necessary.

As I confirmed to Mr Simpson, the resulting regulations will be subject to affirmative procedure and will therefore be fully scrutinised by the Parliament. That is another reason why the matter is better placed in secondary legislation.

Amendments 96 and 97 would amend section 11 by obliging the Scottish ministers, when making regulations that establish who is eligible for enhanced heating, to consult “relevant health bodies” and the patients of such bodies. As the bill stands, section 11(2) provides that

“the Scottish Ministers must consult such persons as they consider appropriate.”

I have asked the fuel poverty advisory panel to examine that. Of course, we will also involve experts as part of the consultation process. A requirement to consult relevant health bodies and their patients could cover almost any national health service patient, rather than just people with conditions that make them vulnerable to the cold and who need higher temperatures in their homes for longer hours.

Therefore, I do not support any of the amendments in the group. I ask the committee to vote against them.

Jackie Baillie

I think that we all agree that some groups of people need to heat their homes more and for longer and that there is an additional cost to doing so, which should be accurately captured if we are to tackle fuel poverty. I think that we also all agree that the groups that have been identified by a range of organisations are the right ones. The question is whether that should be stated in the bill. The politics of the issue are that, if we believe that something is important, we should put it in the bill. Why run the risk of letting people slip through the net?

Let me be perfectly candid. Whether regulations are subject to the affirmative, negative or super-affirmative procedure—which I will be happy to explain at length to the committee—is not something that gives comfort to a person who has to choose between heating and eating. I ask the committee to support all the amendments in the group and I press amendment 57.

The Convener

We all appreciate your offer of a lesson on the super-affirmative procedure.

Jackie Baillie

I will do it now if you wish.

The Convener

The question is, that amendment 57 be agreed to. Are we agreed?

Members: No.

The Convener

There will be a division.

For

Rowley, Alex (Mid Scotland and Fife) (Lab)

Against

Wightman, Andy (Lothian) (Green) Stewart, Alexander (Mid Scotland and Fife) (Con) Simpson, Graham (Central Scotland) (Con) Gibson, Kenneth (Cunninghame North) (SNP) Ewing, Annabelle (Cowdenbeath) (SNP)Dornan, James (Glasgow Cathcart) (SNP)

The Convener

The result of the division is: For 1, Against 6, Abstentions 0.

Amendment 57 disagreed to.

Amendment 58 moved—[Jackie Baillie].

The Convener

The question is, that amendment 58 be agreed to. Are we agreed?

Members: No.

The Convener

There will be a division.

For

Rowley, Alex (Mid Scotland and Fife) (Lab)

Against

Wightman, Andy (Lothian) (Green) Stewart, Alexander (Mid Scotland and Fife) (Con) Simpson, Graham (Central Scotland) (Con) Gibson, Kenneth (Cunninghame North) (SNP) Ewing, Annabelle (Cowdenbeath) (SNP)Dornan, James (Glasgow Cathcart) (SNP)

The Convener

The result of the division is: For 1, Against 6, Abstentions 0.

Amendment 58 disagreed to.

Amendment 59 moved—[Jackie Baillie].

The Convener

The question is, that amendment 59 be agreed to. Are we agreed?

Members: No.

The Convener

There will be a division.

For

Rowley, Alex (Mid Scotland and Fife) (Lab)

Against

Wightman, Andy (Lothian) (Green) Stewart, Alexander (Mid Scotland and Fife) (Con) Simpson, Graham (Central Scotland) (Con) Gibson, Kenneth (Cunninghame North) (SNP) Ewing, Annabelle (Cowdenbeath) (SNP)Dornan, James (Glasgow Cathcart) (SNP)

The Convener

The result of the division is: For 1, Against 6, Abstentions 0.

Amendment 59 disagreed to.

Amendment 60 moved—[Jackie Baillie].

The Convener

The question is, that amendment 60 be agreed to. Are we agreed?

Members: No.

The Convener

There will be a division.

For

Rowley, Alex (Mid Scotland and Fife) (Lab)

Against

Wightman, Andy (Lothian) (Green) Stewart, Alexander (Mid Scotland and Fife) (Con) Simpson, Graham (Central Scotland) (Con) Gibson, Kenneth (Cunninghame North) (SNP) Ewing, Annabelle (Cowdenbeath) (SNP)Dornan, James (Glasgow Cathcart) (SNP)

The Convener

The result of the division is: For 1, Against 6, Abstentions 0.

Amendment 60 disagreed to.

The Convener

Amendment 20, in the name of the minister, is grouped with amendments 1, 21A, 21B, 22, 23 and 37.

Kevin Stewart

I am committed to tackling fuel poverty wherever it occurs and to ensuring that our remote and island areas are properly represented in the new definition of fuel poverty. Amendments 20, 21 to 23 and 37 will establish a “remote rural area”, “remote small town” and “island area” minimum income standard uplift. The approach will improve the bill and responds to stakeholders’ views and the committee’s clear recommendation.

I am determined that we should use appropriate research to develop the approach to ensure that the new definition reflects the reality of the costs that are associated with living in remote and island communities.

The regulations for which the proposed approach provides will be subject to the affirmative procedure to allow a high level of scrutiny by the Parliament. The regulation-making power will be used to appoint someone to carry out the research and make a determination in line with the methodology that has been discussed with the committee, covering categories 4 and 6 in the Scottish Government urban rural classification. I will ensure that a key criterion for selecting the research organisation will be its level of experience and expertise in conducting this type of research. Identifying the organisation to undertake the necessary research will require a procurement process, so we cannot specify an organisation in primary legislation without overriding existing procurement law and practice.

I am clear that this uplift must always and explicitly include island communities, and reflect the unique challenges that they face in the higher cost of living. I am therefore happy to support Liam McArthur’s amendments, which will provide for a separate uplift for island communities.

Mr McArthur has been a strong advocate for his constituency and, during the scrutiny of the bill, he has engaged with me constructively, for which I thank him. I therefore urge members to vote for all the amendments in the group.

I move amendment 20.

The Convener

I welcome to the committee Claudia Beamish, Alexander Burnett and Liam McArthur. I ask Liam McArthur to speak to amendment 21A and other amendments in the group.

Liam McArthur (Orkney Islands) (LD)

Thank you, convener. Before I speak to the amendments, I put on record my thanks to the committee for the work that it has done in getting to the point at which the bill better reflects the particular circumstances of fuel poverty in remote rural and island areas. I also reciprocate the minister’s thanks for his engagement on the issue over many months, dating back to the time when I was raising concerns in the context of the parliamentary scrutiny of the Islands (Scotland) Bill.

Few communities in Scotland are unaffected by fuel poverty, but all the evidence shows that remote rural and island communities are affected disproportionately. That was borne out by the work of the Government’s rural fuel poverty task force, ably chaired by Di Alexander, whose evidence to the committee clearly proved to be persuasive with members of the committee and, I am pleased to note, with the minister.

I welcome the minister’s amendments. They go a long way towards addressing the calls for a separate minimum income standard for remote rural and island areas, reflecting the additional costs that are borne by those who live in those communities. As I said at stage 1, the approach is universally supported by councils, housing associations, and fuel poverty groups across the Highlands and Islands and beyond.

However, further small but important changes are still needed if the bill is to be fully island proofed. My amendments 21A and 21B will achieve that by distinguishing between remote rural areas on the mainland and island communities. Concerns were expressed that making such a distinction would result in additional cost and complexity. We now know from Professor Hirsch, the Scottish Parliament information centre and the Government that that is not the case in either respect. Those assurances are very welcome and allow us to proceed with confidence that the changes will enable the targeting of resources at those who are most in need and that the specific circumstances of remote rural and island communities will be taken into account, and that that can be achieved without diverting resources away from the front line.

Again, I thank the minister and the committee for their support in getting to this stage. I particularly thank Di Alexander and the other experts in the field who have, over many months, made the case patiently, consistently and, I am pleased to say, successfully. I will move amendment 21A in due course.

Graham Simpson

I will support all the amendments in the group. They reflect very well the work that the committee did at stage 1. I thank the minister for listening to the concerns that were raised in the evidence that we took. I also thank Liam McArthur for lodging his useful amendments to island proof the MIS. This is an example of how a bill can be much improved through the work of this committee. We will end up helping people who live in remote rural areas and island communities.

Kevin Stewart

I thank the committee members for their efforts in this area. I also pay tribute to Di Alexander for his work over many a year. As many of you will know, Di can be rather vociferous at points, which I do not think is necessarily a bad thing.

Equally, I would like to pay tribute to a number of MSPs, including Liam McArthur, who have put their islands at the heart of this process. I know that Mr Gibson has been at the forefront in that regard, and Alasdair Allan has also been speaking to me on the issue.

09:30  

Obviously, passing these amendments is important. The committee can be assured that my officials and I will continue to listen to the voices of island communities and remote communities as we move forward.

Amendment 20 agreed to.

Amendment 61 moved—[Jackie Baillie].

The Convener

The question is, that amendment 61 be agreed to. Are we agreed?

Members: No.

The Convener

There will be a division.

For

Rowley, Alex (Mid Scotland and Fife) (Lab)

Against

Wightman, Andy (Lothian) (Green) Stewart, Alexander (Mid Scotland and Fife) (Con) Simpson, Graham (Central Scotland) (Con) Gibson, Kenneth (Cunninghame North) (SNP) Ewing, Annabelle (Cowdenbeath) (SNP)Dornan, James (Glasgow Cathcart) (SNP)

The Convener

The result of the division is: For 1, Against 6, Abstentions 0.

Amendment 61 disagreed to.

Amendment 21 moved—[Kevin Stewart].

Amendments 21A and 21B moved—[Liam McArthur]—and agreed to.

Amendment 21, as amended, agreed to.

Amendment 100 moved—[Jackie Baillie]—and agreed to.

Amendment 63 moved—[Jackie Baillie].

The Convener

The question is, that amendment 63 be agreed to. Are we agreed?

Members: No.

The Convener

There will be a division.

For

Rowley, Alex (Mid Scotland and Fife) (Lab)

Against

Wightman, Andy (Lothian) (Green) Stewart, Alexander (Mid Scotland and Fife) (Con) Simpson, Graham (Central Scotland) (Con) Gibson, Kenneth (Cunninghame North) (SNP) Ewing, Annabelle (Cowdenbeath) (SNP)Dornan, James (Glasgow Cathcart) (SNP)

The Convener

The result of the division is: For 1, Against 6, Abstentions 0.

Amendment 63 disagreed to.

Amendments 22 and 23 moved—[Kevin Stewart]—and agreed to.

Amendment 64 moved—[Jackie Baillie].

The Convener

The question is, that amendment 64 be agreed to. Are we agreed?

Members: No.

The Convener

There will be a division.

For

Rowley, Alex (Mid Scotland and Fife) (Lab)

Against

Wightman, Andy (Lothian) (Green) Stewart, Alexander (Mid Scotland and Fife) (Con) Simpson, Graham (Central Scotland) (Con) Gibson, Kenneth (Cunninghame North) (SNP) Ewing, Annabelle (Cowdenbeath) (SNP)Dornan, James (Glasgow Cathcart) (SNP)

The Convener

The result of the division is: For 1, Against 6, Abstentions 0.

Amendment 64 disagreed to.

Section 2, as amended, agreed to.

After section 2

Amendments 24 and 25 moved—[Kevin Stewart]—and agreed to.

Section 3—Preparation of strategy

The Convener

Amendment 101, in the name of Jackie Baillie, is grouped with amendments 31, 102, 103, 32, 104, 36 and 87.

Jackie Baillie

I will be brief as I move my final amendment today. In a previous incarnation, amendment 101 was amendment 65. However, helpfully, during the week in which the committee did not meet, I had a brief discussion with the Government and chose to withdraw amendment 65 and to substitute amendment 101 for it.

The purpose of amendment 101 is straightforward. It would require the Scottish Government to prepare its fuel poverty strategy with the involvement of key groups: those with lived experience of fuel poverty, disabled people, older people and people in rural areas. I think that the committee would agree that those groups are key.

Consultation can be extremely passive. I know that that is not the Scottish Government’s intention and that the Government rightly embraces co-production. However, I could find no legal definition of “co-production” that would be suitable for inclusion in the bill. My original wording was “co-operation”, but according to the Government’s legal advisers, that implies a degree of compulsion. I have therefore settled on “involvement”, and I hope that the Scottish Government and the committee can agree that that is an appropriate word.

Amendment 101 is supported by a wide range of organisations including the Poverty Alliance Scotland, Citizens Advice Scotland, Common Weal, Inclusion Scotland and the Health and Social Care Alliance Scotland.

I move amendment 101.

Kevin Stewart

There are in the group several amendments that have been lodged by me and by three other colleagues. I hope that the convener will forgive me if I take some time to go over each set. I will discuss my amendments first, before moving on to others in the group.

The bill currently provides that, in preparing the strategy and our periodic report,

“Ministers must consult such persons as they consider appropriate”,

including those with lived experience of fuel poverty. Amendments 31 and 36 will extend that provision to include the local authority partners who help us to deliver support. Amendment 32 will commit us to laying before Parliament a report on the consultation process for the preparation of the strategy, which must state how consultees’ views have been taken into account. The amendment will also require ministers to make a parliamentary statement on the strategy. That will further strengthen the bill and the requirements on whom to consult, as well as ensuring that Parliament can hold the Government to account.

Alex Rowley’s amendment 87 stipulates four categories of folk that we would need to consult when preparing periodic reports. I fully expect that we would consult people in those categories anyway, so I have no problem with the consultation duty being extended to guarantee it. Therefore, I am happy to support Mr Rowley’s amendment.

In contrast, I have a difficulty with the way in which Jackie Baillie’s amendment 101 is framed. I have no objection to obliging ministers to consult the type of folk that Jackie Baillie wants them to involve when they are preparing the strategy, just as Mr Rowley’s amendment 87 will do for periodic reports. However, amendment 101 would place an obligation on ministers, under section 3, to prepare the strategy “with the involvement of” the folk who are listed in the amendment: under section 4, the bill already requires the strategy to be prepared in consultation with people, so amendment 101 would result in duplication.

In addition, my legal team tells me that it is better to use the word “consult” than to use the word “involve” for what ministers are obliged to do. That is because, from a legal perspective, what the duty to “consult” individuals in the preparation of the strategy means is clearer than what is meant by the duty to “involve” them. Also, for legal reasons, it would be important to use wording that makes it clear how the people who are to be consulted would be selected. Otherwise, the validity of the strategy could be attacked for its not including everyone in the country who falls into one of those categories—which, of course, would be a lot of people.

I stress that I am sympathetic to what Jackie Baillie is trying to achieve; therefore, I suggest a solution. I am happy to lodge an amendment at stage 3 that will achieve Jackie Baillie’s objectives in a more considered way, and which will replicate the requirements for the periodic reporting on the fuel poverty strategy in Mr Rowley’s amendment 87. That would align the bill and ensure that we consult all the categories of people that Mr Rowley and Ms Baillie listed, through placing that provision within the relevant section.

I therefore ask the committee to support amendment 87 and to vote against amendment 101.

Graham Simpson will speak further to his amendments 102, 103 and 104. They would mean that, before ministers could complete the strategy or any revision of it, Parliament would get a reasonable period in which to scrutinise what was being proposed. That is in line with the procedure that was adopted for the islands plan. Mr Simpson’s amendment 8 was more onerous, so I am glad that we were able to discuss what he is trying to achieve and reach consensus. I hope that the committee will support the three amendments.

Graham Simpson

As the minister has said, I lodged amendment 8 and then withdrew it. It was lodged with the best intentions, and it was similar to one that was lodged during the passage of the Planning (Scotland) Bill. It was about parliamentary scrutiny of the draft strategy. It was pointed out to me that, despite the good intentions, if the amendment was agreed to as it was worded, it could take a full year for the draft strategy to get through, which was clearly not my intention. Being the practical man that I am, I withdrew amendment 8 and have come back with an alternative that is slightly less onerous but which would still allow Parliament to scrutinise the draft strategy, which I hope we all feel is very important. That explains amendments 102 to 104.

I will support Alex Rowley’s amendment 87. It is a measured amendment, which is what we would expect from Mr Rowley, of course. Sadly, I cannot support Jackie Baillie’s amendment 101. However, I see the intentions behind it and urge her, if it is rejected, to come back at stage 3 with a slightly reworded amendment.

Alex Rowley (Mid Scotland and Fife) (Lab)

It seems to me that the periodic report must reflect people’s lived experiences of fuel poverty. In particular, it is important that the Government speaks to the most vulnerable groups, which are identified in amendment 87, because doing so will allow it to understand how they are being impacted on by the Government’s strategy and what support is or is not reaching them. I welcome the fact that the minister has indicated that he will support the amendment.

The Convener

As no other member wishes to contribute, I call Jackie Baillie to wind up and to press or seek to withdraw amendment 101.

Jackie Baillie

I will not add to what I have already said. In recognition of the minister’s position, I will seek to withdraw amendment 101 if he gives a commitment that he is happy to work with me, and I will bring back an amendment at stage 3, as Graham Simpson has suggested.

Kevin Stewart

I am more than happy to do that, convener.

Amendment 101, by agreement, withdrawn.

Amendment 26 moved—[Kevin Stewart].

The Convener

If amendment 26 is agreed to, I will be unable to call amendment 66, due to pre-emption.

Amendment 26 agreed to.

The Convener

Does Graham Simpson wish to move amendment 7?

Graham Simpson

I will not move amendment 7, because it relates to the 2032 target.

Amendment 7 not moved.

Amendment 6 moved—[Graham Simpson].

The Convener

The question is, that amendment 6 be agreed to. Are we agreed?

Members: No.

The Convener

There will be a division.

For

Stewart, Alexander (Mid Scotland and Fife) (Con) Simpson, Graham (Central Scotland) (Con) Rowley, Alex (Mid Scotland and Fife) (Lab) Gibson, Kenneth (Cunninghame North) (SNP) Ewing, Annabelle (Cowdenbeath) (SNP)Dornan, James (Glasgow Cathcart) (SNP)

Against

Wightman, Andy (Lothian) (Green)

The Convener

The result of the division is: For 6, Against 1, Abstentions 0.

Amendment 6 agreed to.

The Convener

Amendment 45, in the name of Pauline McNeill, is grouped with amendments 68, 46 to 48, 71, 72, 49, 73, 50, 51 and 98. I remind members that, under rule 9.12.6C, the Presiding Officer has determined that the costs associated with amendment 48 would be significant. Therefore, amendment 48 may be debated, but in the absence of a financial resolution the question on it cannot be put. Alex Rowley has agreed to move amendment 45 and to speak to the amendments in the group on behalf of Pauline McNeill.

Alex Rowley

I will speak to Pauline McNeill’s amendments as well as to my amendment 68.

As part of the strategy, ministers must set out how they will identify households that are in fuel poverty. That is crucial. The new definition of fuel poverty is welcome, but it is highly complex and the Government must consider how it will translate into direct support for those who are living in fuel poverty.

Ministers setting out how they plan to identify households that are in fuel poverty is a crucial part of the process. It would be useful for the Parliament, the third sector and any other interested parties to understand how ministers will do that.

I move amendment 45.

09:45  
Andy Wightman (Lothian) (Green)

Amendment 46 is designed to establish the quantum of buildings that have low levels of energy efficiency and that require improvements by the target date. However, I will not move it, as it contains the wrong date and Alexander Burnett’s amendment 47 expresses my intentions more accurately.

Alexander Burnett (Aberdeenshire West) (Con)

I thank the committee for its work to date and refer members to my interests regarding construction and property management.

My amendments 47 and 48 are aimed at improving the route for residential buildings across Scotland to achieve an energy performance certificate C rating or better. To give some context, the Scottish Government currently has a target of 2040 for that, but on 10 May the Parliament gave cross-party support to a motion on improving that date by bringing it forward to 2030. The motion detailed that the Parliament believes that

“the target for all homes reaching EPC ‘C’ rating, where feasibly possible, should be no later than 2030, not 2040, given the urgency to reduce carbon emissions and to ensure that every home in Scotland is warm and properly insulated”.

Just last week, the Scottish Government launched the energy efficient Scotland consultation, which is on the further development of the programme and proposes that some properties will reach EPC band C by 2025. Therefore, it appears that enthusiasm for improving energy efficiency in homes is gathering momentum, which is to be welcomed. However, to achieve that requires not only physical improvements to buildings but preparatory steps—namely, identification of the work. My amendments 47 and 48 merely seek to put into legislation a requirement for the Government to carry out the preparatory work on the necessary steps to achieve the target that the Government first set out and which has been improved by the Parliament.

The first step is to have a strategy for how we identify the buildings, which is the aim of amendment 47. I am grateful for previous indications of support on that from the Scottish Government.

The second step is actual identification of the residential buildings and the work that is required, which is covered by amendment 48. I appreciate that, in the absence of a financial resolution, a question cannot be put on the amendment. However, amendment 48 would simply build on amendment 47 by requiring the Government not only to set out the approach to identifying relevant buildings but to actually identify them.

Annabelle Ewing

I note Alexander Burnett’s point that the question on amendment 48 cannot be put because there is no financial resolution. Just for the record, given that the information is not available to people who are watching the proceedings, what is the financial implication of amendment 48?

Alexander Burnett

The Presiding Officer estimates that it would be £60 million, and information from the Government put the figure at between £58 million and £116 million. I will come to that in a second.

I will not seek to withdraw amendment 48, because I believe that it is important to debate that second step so that we get on the record the minister’s comments on how he sees the targets being achieved, either through the bill or elsewhere. The Presiding Officer has estimated that the work would cost £60 million, but correspondence from the minister’s office suggests that the cost would be anywhere between £58 million and £116 million. The correspondence also highlighted issues with the identification process. Both points, on cost and process, will need to be addressed, and the sooner the better.

In a slightly odd request, given that a question cannot be put on amendment 48, I was urged to withdraw it so that it would not be debated. On many levels, that seemed to be wrong, so I would appreciate the minister’s explanation of that reluctance and why his support for amendment 47 is contingent on another amendment, on which a question cannot be put, being withdrawn.

The only way to achieve an EPC rating of band C or higher in all residential homes in which that is technically feasible is by spending money. Amendment 48 would have accelerated that process by putting a binding commitment on the Scottish Government to identify what work is needed. Should members express support for amendment 48, I hope that the minister will listen and amend the financial memorandum in time for the next stage, to permit a financial resolution that actually delivers for energy-efficient housing.

As a final explanatory point, I refer members to the fact that amendments 47 and 48 detail that the requirement to achieve an EPC rating of C or higher will be enforced only

“where it is technically feasible and cost effective”.

The reason for that is that we are aware that, in some rural areas and on the islands, an EPC rating of C or above might not be achievable in a cost-effective manner.

To effectively reduce fuel poverty, we must take action. The amendment will ensure that steps are taken to make progress towards our shared goal of reducing fuel poverty across Scotland. By identifying residential homes that are less energy efficient, we can take steps to reduce bills and carbon emissions and ensure that residents are living in warmer homes.

I understand that amendment 48 cannot be put to a vote, but I would be grateful if members would express their views and indicate whether they would have supported it.

Claudia Beamish (South Scotland) (Lab)

Amendment 72 would require provision for the removal of low levels of energy efficiency—a driver of fuel poverty—in relation to housing in multiple occupation to be considered by ministers in preparation of the fuel poverty strategy. That would also aid in reduction of carbon emissions.

Amendment 72 has been framed in the most straightforward way possible, although it relates to a complex issue. There are many buildings in Scotland that fall into the category of housing in multiple occupation, and it can be very challenging to deal with low levels of energy efficiency in those circumstances. That is due, in part, to the difficulties that are experienced in relation to areas of common responsibility, such as stairwells and roofing.

The complexity of proceeding with energy efficiency actions can be due to several reasons, including failure to identify ownership of one of the homes, an occupant’s lack of interest or people’s refusal to get involved. Such challenges should not be allowed to become insurmountable for such a serious issue. As I am sure the committee will recognise, the issue can be particularly difficult for several categories of home dweller, including tenants living in the broad category of private rented accommodation and students living in rented accommodation. I am clear that landlords have a responsibility to ensure that the accommodation that they let reaches a liveable standard in relation to energy efficiency. Housing is a right under the Universal Declaration of Human Rights and, in Scotland, that surely means a right to a warm home.

I lodged amendments to address the issue at stage 2 of the Housing (Scotland) Act 2014—excuse me for stuttering, but 2014 seems a long time ago. At that time, I tried to create a duty to meet energy efficiency standards through the repairing standard in section 22 of the act. That was a much more detailed approach.

In 2014, the minister argued that the Scottish Government had put together a ministerial working group to look at energy efficiency standards in the whole of the private sector and said that the group was likely to report back on that work in the autumn of 2014. I was encouraged not to move my amendment at that time, given that the issue was to be explored by the ministerial working group. It is disappointing that, five years on, the issue has not been tackled—we now have an opportunity to do that.

Amendment 72 is a probing amendment at this stage. In view of the challenges that are faced by many people living in multiple occupancy buildings, I hope that the minister will consider having discussions with me and others who are interested in tackling such a serious fuel poverty issue.

Amendment 73 would ensure that, in preparing the fuel poverty strategy, ministers would have to consider how rural co-operatives and community bodies can be supported to identify sustainable energy solutions. Rural fuel poverty can present a very serious challenge to comfortable living. I am sure that the committee is aware that the 2017 statistics for the Scottish house condition survey show urban fuel poverty at 21 per cent and rural fuel poverty at a staggering 43 per cent. Sadly, I doubt that the next set of figures will have altered significantly.

Particular challenges are faced by owners and tenants who are living off-grid. People also face challenges that are created by their distance from the advice that would be available if they were not so remote. The identification of available skilled companies in remote areas can also create difficulties in gaining valuable advice.

In essence, amendment 73 would bring targeted support for collective action to tackle the challenges. Solutions might include a group of houses and nearby workshops tackling energy efficiency issues, such as insulation, at the same time. That could bring down costs. In a village, town or city, there are often opportunities for area-based action. However, in rural areas that is often not possible for the reasons that I have just mentioned and because of issues of scale.

Several estates in my region of South Scotland have successfully introduced sustainable energy solutions, such as the biomass boilers in Douglas village, installed by Douglas & Angus Estates, and Dumfries house. However, they have the financial capacity to deal with the challenges in a way that is often not possible for community groups or those who might form a co-operative for action in a small hamlet or remote area. As I have said, the challenges are manifold and could be compounded by the cost issues, so support in that regard should also be considered.

My amendment 73 is a probing amendment to provoke further discussion on the challenges for remote rural fuel poverty and on possible actions to support change as part of the strategy. I hope that it will be possible to discuss those issues further with the minister and others who are interested in advance of stage 3.

Amendment 98, which is consequential on amendment 73, requires the Scottish ministers to define “rural areas”, “rural co-operatives” and “sustainable energy solutions” by negative procedure.

Graham Simpson

I would like to speak about Alexander Burnett’s amendments 47 and 48. Because we have spoken about the issue often enough in this committee, I think that we would all agree that we need to improve the energy performance of homes across Scotland. That clearly relates to fuel poverty. Mr Burnett’s amendment 47 should be supported in that regard, because it would merely get the Government to set out how it plans to identify buildings that have low levels of energy efficiency. That is the right thing to do, because, if we cannot do that, we will not be able to improve matters.

However, his amendment 48 goes a little bit further, because it would compel the Government to go ahead and identify those buildings. Clearly, that would involve a lot of work, hence the astronomic figures that are attached to the amendment, which are why it cannot be voted on. If we were allowed to vote on it, I would, of course, support it, because both things need to be done. However, as things stand, I will support amendment 47.

Annabelle Ewing

Amendment 48 would cost something more than £60 million, and it is not clear where that money would come from. Perhaps Mr Burnett could propose how he wishes to fund the proposal. Setting the issue aside, I am also not sure that we have the power to require entry to private dwelling houses. Has Mr Burnett considered that?

The Convener

You cannot ask him questions at this point.

Annabelle Ewing

I am terribly sorry, convener. I will just leave the question open. I do not think that, as things stand, the Parliament has the power to require entry into private dwelling houses.

Kevin Stewart

There are a number of issues to discuss in relation to this grouping of amendments. I will deal first with amendments 46, 47 and 48, which concern the EPC ratings. Under amendment 48, in the name of Alexander Burnett, the fuel poverty strategy would be required to include information on the energy efficiency level of the estimated 967,000 private sector residential properties without an existing EPC. Annabelle Ewing is quite right to highlight some of the difficulties that there would be in doing the improvement work. At a cost of between £60 and £121 per home, the proposal would cost between £58 million and £116 million, which is why it is not being voted on today. It would be far beyond the objective of the bill to require the Scottish Government to meet that additional expense, and, in my opinion, such funds would always be better spent on front-line delivery.

10:00  

EPCs are already required for new homes, homes with new building warrant applications and homes that have been sold or rented to a new tenant since 2009. Over time, there will be a constant increase in that information. It has always been my intention that the fuel poverty strategy would address energy inefficiency as a driver of fuel poverty. Ultimately, we are working towards the elimination of energy inefficiency as a driver of fuel poverty.

As Mr Wightman intends to seek to withdraw amendment 46, I will not go into detail about that particular amendment.

I am content to support Alexander Burnett’s amendment 47, which would require the fuel poverty strategy to set out our approach to identifying properties that require improvement to achieve EPC band C rating by 2030. It may be necessary, at stage 3, to be clear that the approach should target fuel-poor households, but I am committed to doing all that we can to establish a clear way forward.

In relation to Claudia Beamish’s amendments 73 and 98, section 3 already allows for the preparation of a fuel poverty strategy and outlines what should be included in it, and the strategy will be designed for the whole of Scotland, including rural areas. Requiring a definition of the term “sustainable energy solutions” in the context of an amendment that focuses on rural areas is unhelpful. Defining the term in a rural-only context may result in a separate understanding of the term at national level. In other words, it could lead to variation in what might be deemed a sustainable energy solution in an urban or rural area.

In addition, section 3(3) of the bill allows the Scottish ministers to include any other information that they consider to be appropriate in the fuel poverty strategy. Therefore, should we need to include specific support in rural areas or to define which groups the support will target, we can do that. For those reasons, I urge the committee to vote against amendments 73 and 98.

I support Pauline McNeill’s amendment 71 but not her amendment 49 or Claudia Beamish’s amendment 72. Amendment 71 would allow us to highlight how we address all four drivers of fuel poverty within the strategy, and it is broad and flexible enough to cover all sectors, including private tenancies and HMOs, so separate amendments are not needed.

For those reasons, I ask the committee to vote against amendments 49 and 72 and to support amendment 71. I am also happy to support Pauline McNeill’s amendments 45, 50 and 51, to ensure that the strategy and periodic reports set out clear costings. I also support Alex Rowley’s amendment 68, which will ensure that the strategy explains how we intend to identify households in fuel poverty.

Alex Rowley

A big success story of the past decade or so has been the improvements in energy efficiency in public sector housing. That is because tight regulations were put in place, requiring councils to improve energy efficiency, so the housing stock in housing associations and councils has a much higher energy efficiency rating. They still have work to do, but they have already done a tremendous amount of work. If the minister is serious about eliminating poor energy efficiency as a driver of fuel poverty in the long term, real work has to be done in that area. I hope that we will see that coming through, in terms of both the strategy and the financial memorandum. I press amendment 45.

Amendment 45 agreed to.

Amendment 27 moved—[Kevin Stewart].

The Convener

I point out that, if amendment 27 is agreed to, I cannot call amendment 67, due to pre-emption.

Amendment 27 agreed to.

Amendment 68 moved—[Alex Rowley]—and agreed to.

Amendment 46 not moved.

Amendment 47 moved—[Alexander Burnett] and agreed to.

The Convener

The question on amendment 48 cannot be put in the absence of a financial resolution.

Amendment 29 moved—[Kevin Stewart].

The Convener

I point out that, if amendment 29 is agreed to, I cannot call amendment 69, due to pre-emption.

Amendment 29 agreed to.

The Convener

The question is, that section 69 be agreed to. Are we all agreed? [Interruption.] Sorry—that is a mistake, so keep quiet. That is why you should never sit beside the teacher. By the way, the mistake was not mine, I am delighted to say. I call amendment 30, in the name of the minister, which has already been debated with amendment 17.

Amendment 30 moved—[Kevin Stewart].

The Convener

I point out that, if amendment 30 is agreed to, amendment 70 cannot be called, due to pre-emption.

Amendment 30 agreed to.

Amendment 71 moved—[Alex Rowley]—and agreed to.

Amendments 72, 49 and 73 not moved.

Amendment 73 not moved.

The Convener

Amendment 74, in the name of Alex Rowley, is grouped with amendments 75, 76 and 83.

Alex Rowley

Amendment 74 aims to ensure that the Scottish ministers keep the strategy under review and, every five years, either publish a new strategy or state why they will not do so. It seems unacceptable that the Government would have to publish only one strategy in such a long period, particularly when interim targets and periodic reports might suggest that the strategy be reviewed, amended or updated. Amendment 74 would not require the Scottish ministers to publish a new strategy if they believe that one is not needed, but the option must be considered, which is the important point. In considering whether to, and then deciding not to publish a new strategy, ministers would have to publish an explanation for why they will not revise the strategy.

I move amendment 74.

Andy Wightman

I support amendment 74. When it was lodged, I was rather surprised to discover that we had not made any recommendation on the matter in our stage 1 report. That was a bit of an oversight, given that the fuel poverty target is for 2040. I am glad that Alex Rowley’s eagle eyes spotted that and that he has dealt with it. The amendment is appropriate, given that the argument for having the 2040 target date is that things will change. If things change, the strategy might also need to change.

Kevin Stewart

Development of the fuel poverty strategy is vital: it will help to deliver change in communities across Scotland, and improve people’s lives. The strategy should work for people wherever they live, and it should help to bring people out of fuel poverty by tackling all four drivers of fuel poverty: income, energy prices, energy efficiency and energy use.

I therefore support amendments 74, 75, 76 and 83, which are in Alex Rowley’s name. They provide a sensible way of ensuring that the fuel poverty strategy can be revised so that it remains effective, particularly in the event of the target date being altered—as Alex Rowley’s amendment 54, which we considered last week, envisaged. If the fuel poverty advisory panel comes to think that the target could be reached sooner, the ability to revise the strategy to take account of that will be key.

The provisions in Mr Rowley’s amendments might need to be slightly revised at stage 3, to ensure that they work as everyone wants them to work, but I anticipate only technical amendments. We will keep to the principle of what Alex Rowley proposes, particularly in light of his arguments last week.

Amendment 74 agreed to.

Section 3, as amended, agreed to.

Section 4—Consultation on strategy

Amendment 75 moved—[Alex Rowley]—and agreed to.

Amendment 31 moved—[Kevin Stewart]—and agreed to.

Amendment 102 moved—[Graham Simpson]—and agreed to.

Section 4, as amended, agreed to.

Section 5—Publication and laying of strategy

Amendment 103 moved—[Graham Simpson]—and agreed to.

Amendment 76 moved—[Alex Rowley]—and agreed to.

Amendment 32 moved—[Kevin Stewart]—and agreed to.

Amendment 104 moved—[Graham Simpson]—and agreed to.

Section 5, as amended, agreed to.

Section 6—Preparation of periodic reports

The Convener

If amendment 33 is agreed to, I cannot call amendment 77.

Amendment 33 moved—[Kevin Stewart]—and agreed to.

Amendment 10 not moved.

Amendment 9 moved—[Graham Simpson].

The Convener

The question is, that amendment 9 be agreed to. Are we agreed?

Members: No.

The Convener

There will be a division.

For

Stewart, Alexander (Mid Scotland and Fife) (Con) Simpson, Graham (Central Scotland) (Con) Gibson, Kenneth (Cunninghame North) (SNP) Ewing, Annabelle (Cowdenbeath) (SNP)Dornan, James (Glasgow Cathcart) (SNP)

Against

Wightman, Andy (Lothian) (Green)

Abstentions

Rowley, Alex (Mid Scotland and Fife) (Lab)

The Convener

The result of the division is: For 5, Against 1, Abstentions 1.

Amendment 9 agreed to.

Amendment 50 moved—[Alex Rowley]—and agreed to.

The Convener

If amendment 34 is agreed to, I cannot call amendment 78.

Amendment 34 moved—[Kevin Stewart]—and agreed to.

Amendment 12 not moved.

Amendment 11 moved—[Graham Simpson].

The Convener

The question is, that amendment 11 be agreed to. Are we agreed?

Members: No.

The Convener

There will be a division.

For

Stewart, Alexander (Mid Scotland and Fife) (Con) Simpson, Graham (Central Scotland) (Con) Gibson, Kenneth (Cunninghame North) (SNP) Ewing, Annabelle (Cowdenbeath) (SNP)Dornan, James (Glasgow Cathcart) (SNP)

Against

Wightman, Andy (Lothian) (Green)

Abstentions

Rowley, Alex (Mid Scotland and Fife) (Lab)

The Convener

The result of the division is: For 5, Against 1, Abstentions 1.

Amendment 11 agreed to.

10:15  

Amendment 51 moved—[Alex Rowley]—and agreed to.

Amendment 35 moved—[Kevin Stewart].

The Convener

If amendment 35 is agreed to, I cannot call amendment 79.

Amendment 35 agreed to.

Amendment 14 not moved.

Amendment 13 moved—[Graham Simpson].

The Convener

The question is, that amendment 13 be agreed to. Are we agreed?

Members: No.

The Convener

There will be a division.

For

Stewart, Alexander (Mid Scotland and Fife) (Con) Simpson, Graham (Central Scotland) (Con) Rowley, Alex (Mid Scotland and Fife) (Lab) Gibson, Kenneth (Cunninghame North) (SNP) Ewing, Annabelle (Cowdenbeath) (SNP)Dornan, James (Glasgow Cathcart) (SNP)

Against

Wightman, Andy (Lothian) (Green)

The Convener

The result of the division is: For 6, Against 1, Abstentions 0.

Amendment 13 agreed to.

Amendment 80 not moved.

The Convener

I will suspend the meeting for a short comfort break.

10:16 Meeting suspended.  10:21 On resuming—  
The Convener

Amendment 81, in the name of Annabelle Ewing, is grouped with amendments 82, 84 and 85. Amendments 81 and 82 and amendments 84 and 85 are direct alternatives. For the record, direct alternatives are two or more amendments that seek to replace the same text in a bill with alternative approaches. In the case of this group, there are two such alternatives. For example, for amendments 81 and 82 a vote will be taken on each amendment in the order in which it appears in the marshalled list. If both amendment 81 and amendment 82 were to be agreed to, the second amendment, which is amendment 82, would succeed the former, and the first amendment, which is amendment 81, would cease to have effect.

Annabelle Ewing

Amendments 81 and 84 deal with the frequency of reporting, which the committee looked at during our stage 1 consideration. It is important to state at the outset that although, as set out in the report, the committee felt that on the balance of the evidence that had been received at that stage, a three-year reporting period would be reasonable, we have since received a letter dated 13 February from the Convention of Scottish Local Authorities. In the letter, COSLA states:

“We further note that the committee recommends increasing the frequency of statutory reporting from a five year to a three-year basis. This will place additional requirements on Local Government, which if not fully funded, has the potential to take resources away from front line delivery. In the context of restrained budgets, a balance needs to be struck between reporting and delivery. There needs to be clarity over the time/cost outlay of reporting requirements before any move to increase their frequency.”

My amendments are motivated by COSLA’s concerns. Members will be aware that, when discussing the bill, I have stated repeatedly that my desire is to see money go to the front line and not be subsumed in other matters to the extent that it is not necessary. Therefore, the reporting frequency of four years that I have proposed in my amendments strikes the balance that COSLA, in particular, is looking for. It is necessary to have a reporting mechanism, but I do not want to cost local authorities any more money than is absolutely necessary. I would rather ensure that the money that would be saved by not having a reporting period that is more frequent than every four years could be spent on front-line activities. Those reasons inspired my amendments.

I remind the committee that, aside from the reporting requirement that we are discussing, national statistics on fuel poverty targets will continue to be published year on year by Scotland’s chief statistician, so progress can be tracked. Of course, we also wish to see fuller reporting, and my contention is that, in light of COSLA’s concerns, it would be appropriate to have a reporting period of four rather than three years.

I move amendment 81.

Alex Rowley

I will speak to amendments 82 and 85, which I will move in due course. We need to be able to scrutinise progress, but the question is what would be reasonable in that regard. Many stakeholders have called for an annual report. In trying to find a compromise, I believe that a three-year reporting period would give sufficient time for robust evidence gathering and reporting on independent scrutiny. I do not accept COSLA’s argument about the differences in cost between three-year and four-year reporting periods.

There needs to be a real commitment to ensuring that we are delivering on and tackling fuel poverty. With a review period of three years, if things are not working or happening as they should be, we can take the necessary action.

Graham Simpson

There is a balance between four-year and three-year reporting periods. There is no right answer—we just have to take a view on the issue. The committee considered the matter, and we concluded that the period should be three years.

We heard evidence from councils. Glasgow City Council backed the three-year period. There were other views; the Existing Homes Alliance, for example, supported a one-year period. The committee considered that that would be too onerous.

At the end of the day, if someone does not agree with a five-year reporting period, they have to come up with something else. On this occasion, I will back the committee’s recommendation—it was fully thought through, and we knew the position of councils at the time—and stick to three years. I will support Alex Rowley’s amendments, but not Annabelle Ewing’s amendments.

Kevin Stewart

The amendments in the group deal with formal statutory reporting against the fuel poverty targets. It is right that those reports are careful, thorough and wide-ranging pieces of work, and that, in their preparation, the views of those with direct personal experience in fuel poverty are sought. However, doing that well will require an investment of time and resources from everyone, and I ask the committee to consider carefully the consequences of requiring more frequent reporting.

The financial memorandum to the bill states that the cost of preparing a periodic report is about £90,000 to £100,000. That covers only the direct costs of administrative support, not the time and effort that would be required from delivery partners, stakeholder groups and those with lived experience. I ask members to bear that in mind when they decide on the options in front of the committee.

In its letter to the committee of 13 February, COSLA expressed concern that

“increasing the frequency of statutory reporting from a five year to a three-year basis ... will place additional requirements on Local Government, which ... has the potential to take resources away from front line delivery.”

I, too, have that concern. Likewise, I share COSLA’s concern that,

“In the context of restrained budgets, a balance needs to be struck between reporting and delivery.”

I want to create an industry that is based on developing and installing cost-effective and low-carbon improvements to people’s homes. I am concerned that overly frequent or overly bureaucratic reporting would create an industry that was based on measuring and commenting on fuel poverty, not on eliminating it. I am mindful that the majority view among stakeholders is that reporting should be done more frequently. Changing the reporting period from every five years, as is proposed in the bill, to every four years, as Annabelle Ewing proposes, would provide a good balance between responsiveness and burden.

I ask members to support amendments 81 and 84, instead of amendments 82 and 85, which would create a further burden.

10:30  
Annabelle Ewing

I hear what members have said, but, following our stage 1 report, we should listen to what COSLA has said about a three-year reporting period being more onerous. It is axiomatic that reporting more frequently will cost more money; that goes without saying. Like the minister, I would prefer any spare money to go to front-line local services.

Graham Simpson

Is that not an argument for sticking with a five-year reporting period?

Annabelle Ewing

We heard a number of varying views on what the frequency of reporting should be, and it is incumbent on the committee to respond to those views. Bearing in mind that money will need to be spent on reporting, I feel that the less money that is taken away from the front line the better, while still responding to the issues that were raised in evidence at stage 1. That suggests that a four-year period might be more appropriate than a three-year period.

I press amendment 81.

The Convener

The question is, that amendment 81 be agreed to. Are we agreed?

Members: No

The Convener

There will be a division.

For

Ewing, Annabelle (Cowdenbeath) (SNP)Dornan, James (Glasgow Cathcart) (SNP)

Against

Wightman, Andy (Lothian) (Green) Stewart, Alexander (Mid Scotland and Fife) (Con) Simpson, Graham (Central Scotland) (Con) Rowley, Alex (Mid Scotland and Fife) (Lab)Gibson, Kenneth (Cunninghame North) (SNP)

The Convener

The result of the division is: For 2, Against 5, Abstentions 0.

Amendment 81 disagreed to.

Amendment 82 moved—[Alex Rowley].

The Convener

The question is, that amendment 82 be agreed to. Are we agreed?

Members: No.

The Convener

There will be a division.

For

Wightman, Andy (Lothian) (Green) Stewart, Alexander (Mid Scotland and Fife) (Con) Simpson, Graham (Central Scotland) (Con) Rowley, Alex (Mid Scotland and Fife) (Lab)Gibson, Kenneth (Cunninghame North) (SNP)

Against

Ewing, Annabelle (Cowdenbeath) (SNP)Dornan, James (Glasgow Cathcart) (SNP)

The Convener

The result of the division is: For 5, Against 2, Abstentions 0.

Amendment 82 agreed to.

Amendment 83 moved—[Alex Rowley]—and agreed to.

Amendment 84 moved—[Annabelle Ewing].

The Convener

The question is, that amendment 84 be agreed to. Are we agreed?

Members: No.

The Convener

There will be a division.

For

Ewing, Annabelle (Cowdenbeath) (SNP)Dornan, James (Glasgow Cathcart) (SNP)

Against

Wightman, Andy (Lothian) (Green) Stewart, Alexander (Mid Scotland and Fife) (Con) Simpson, Graham (Central Scotland) (Con) Rowley, Alex (Mid Scotland and Fife) (Lab)Gibson, Kenneth (Cunninghame North) (SNP)

The Convener

The result of the division is: For 2, Against 5, Abstentions 0.

Amendment 84 disagreed to.

Amendment 85 moved—[Alex Rowley].

The Convener

The question is, that amendment 85 be agreed to. Are we agreed?

Members: No.

The Convener

There will be a division.

For

Wightman, Andy (Lothian) (Green) Stewart, Alexander (Mid Scotland and Fife) (Con) Simpson, Graham (Central Scotland) (Con) Rowley, Alex (Mid Scotland and Fife) (Lab)Gibson, Kenneth (Cunninghame North) (SNP)

Against

Ewing, Annabelle (Cowdenbeath) (SNP)Dornan, James (Glasgow Cathcart) (SNP)

The Convener

The result of the division is: For 5, Against 2, Abstentions 0.

Amendment 85 agreed to.

Amendment 86 not moved.

Section 6, as amended, agreed to.

Section 7—Consultation on periodic reports

Amendment 36 moved—[Kevin Stewart]—and agreed to.

Amendment 87 moved—[Alex Rowley]—and agreed to.

Section 7, as amended, agreed to.

Section 8 agreed to.

Section 9—Report on the 2040 target

The Convener

Amendment 89, in the name of Alex Rowley, is grouped with amendment 88. I advise members that amendments 89 and 88 are direct alternatives.

Alex Rowley

I will seek to withdraw amendment 89, but I intend to press amendment 88, which would require a report on the fuel poverty target to be presented within a year of the target elapsing rather than within two years.

As drafted, the bill gives ministers two years to report on the target after it has passed. I believe that there will be substantial parliamentary and public interest in whether the target was met and why, and that there will be a strong impetus to continue the good work that has been done or to take steps so that the target can be met. It seems reasonable that a year provides sufficient time to gather and present evidence so that further steps on energy and fuel poverty can be developed. The date would be brought forward a year, but that is perfectly reasonable and doable.

I move amendment 89.

Kevin Stewart

I understand why Alex Rowley is keen for the report on the 2040 target to be published as soon as possible after the end of 2040, but the date that he proposes is simply not feasible.

The target is to do with the position in 2040, and that means all of 2040. Analysts will therefore be gathering data on the target right up until the end of that year. If Parliament has to get the report by 31 March 2041, we would not be able to give the full picture of whether the target had been met and the percentage of households that are still in fuel poverty, and the report would have to be very different from all the previous ones because of the truncation of time.

The results on fuel poverty rates come from the Scottish house condition survey. Those statistics are usually published in the year following the survey, so if we are to use those key national statistics, as we will for all other progress reports, the earliest that we will know the 2040 fuel poverty rate will be in December 2041.

The survey reporting timetable cannot be condensed to report by 31 March 2041, as that would not provide sufficient time to complete all the necessary work. Data will be collected from households across Scotland throughout the entirety of 2040, but the work will not stop there. Once the basic data is collected, modelling needs to be undertaken to estimate the consumption and required fuel bills of the households. Weightings need to be derived to ensure that the results are representative of the Scottish household population, and quality assurance must be undertaken. Only then can the data begin to be analysed.

It is crucial that the statistics from the survey remain robust and continue to meet national statistics standards for quality and integrity. If the date is brought forward by a year to the end of March 2041, that would leave only three months for the entire report to be compiled, which would mean that it could not contain 2040 fuel poverty rates.

I think that we all want Parliament to get a thorough and comprehensive report that includes all the available details and headline statistics that relate to the target year and are fully compliant with the national statistics code of practice. If the report has to be turned round within a three-month timeframe, Parliament will not receive that.

I understand why folks might want an earlier reporting date, but that is simply not feasible. Therefore, I ask the committee not to agree to Alex Rowley’s amendment.

Alex Rowley

Given what the minister has said, it is clear that I need to go back and look at the matter. I will have a discussion with the minister, if necessary, and return to the matter at stage 3. Therefore, I will not move amendment 88.

Kevin Stewart

I am happy to provide Mr Rowley with the information that he requires and to have further discussions on the matter.

Amendment 89, by agreement, withdrawn.

Amendments 88 and 90 not moved.

Amendment 91 moved—[Alex Rowley].

The Convener

The question is, that amendment 91 be agreed to. Are we agreed?

Members: No.

The Convener

There will be a division.

For

Rowley, Alex (Mid Scotland and Fife) (Lab)

Against

Wightman, Andy (Lothian) (Green) Stewart, Alexander (Mid Scotland and Fife) (Con) Simpson, Graham (Central Scotland) (Con) Gibson, Kenneth (Cunninghame North) (SNP) Ewing, Annabelle (Cowdenbeath) (SNP)Dornan, James (Glasgow Cathcart) (SNP)

The Convener

The result of the division is: For 1, Against 6, Abstentions 0.

Amendment 91 disagreed to.

Amendment 92 not moved.

Section 9 agreed to.

After section 9

Amendment 93 moved—[Alex Rowley].

The Convener

Amendment 93A, in the name of Graham Simpson, is grouped with amendment 93B.

Graham Simpson

I will be very brief, convener. These tidying-up amendments relate to amendment 93 in the name of Alex Rowley, on the Scottish fuel poverty advisory board. Amendment 93 contains the phrases

“progress toward meeting the 2032 target”

and

“the likelihood of meeting the 2032 target”.

Given that that target does not exist any more, my amendments seek to tidy up amendment 93 by replacing the phrase “2032 target” with “fuel poverty targets”, which better reflects what we have already agreed to.

I move amendment 93A.

Kevin Stewart

In our discussions last week on amendment 93 in the name of Alex Rowley, I said that, although I supported putting the advisory panel on a statutory footing, the wording would need to be refined, as the amendment was based on the 2032 target date, and we would be taking a closer look at costs while keeping a cap. I am therefore pleased that Mr Simpson has lodged amendments 93A and 93B to correct the references, and I am happy to support them.

Amendment 93A agreed to.

Amendment 93B moved—[Graham Simpson]—and agreed to.

Amendment 93, as amended, agreed to.

Section 10 agreed to.

Section 11—Regulation-making powers

Amendment 94 moved—[Alex Rowley]—and agreed to.

Amendments 37 and 38 moved—[Kevin Stewart]—and agreed to.

Amendment 95 moved—[Alex Rowley]—and agreed to.

Amendments 96 to 98 not moved.

The Convener

Amendment 39, in the name of the minister, is grouped with amendment 1.

Kevin Stewart

Both amendments in this group have the shared motivation of seeking to ensure that the bill’s provisions are implemented as soon as possible, Unfortunately, amendment 1, in the name of Mr Wightman, would have significant unintended consequences that would hinder implementation and might leave us in an unworkable situation.

If, as Mr Wightman’s amendment would require, all the provisions were to come into force the day after royal assent, we would not have an operable definition of “fuel poverty” under section 2, because neither the enhanced heating regime nor the remote and island areas uplift to the minimum income standard would be in place. Both the setting of enhanced heating eligibility and the remote rural and islands MIS require the Parliament to agree affirmative regulations. It is not in the Government’s gift to expedite parliamentary approval of those, as the timetable for that is not one that we can control.

10:45  

Mr Wightman’s amendment would also bring sections 3 and 5 of the bill into force, legally requiring the Government to publish the fuel poverty strategy within a year of the bill becoming law and forcing us to prepare the strategy without knowing the full detail of the definition of fuel poverty. In addition, section 4 requires consultation with appropriate people, including those who are living or have lived in fuel poverty. That would also be problematic as we would not be clear about whom it would be appropriate for us to consult with.

The result would be gridlock and the production of a strategy that would not match up properly with the definition of fuel poverty and which would risk failing to focus on the people who need it most.

I am determined to implement the provisions of the bill as soon as possible—I want to crack on, convener. However, considering the proposals in the bill and the amendments that have been made to it in committee, we cannot follow the rigid timetable that Mr Wightman is suggesting.

I want to ensure that the new fuel poverty definition can become operable as soon as possible. My amendment will facilitate the earliest possible completion of work on the enhanced heating regime and will allow us to undertake further consultation on it, in tandem with the bill’s progress through Parliament. That will allow for faster commencement and implementation of the whole bill. I have no wish for things to be held up any longer than is necessary for the legislative process. I want to get the definition and the strategy in place and to get on with the job of helping folk out of fuel poverty.

Mr Wightman’s amendment would cause significant difficulties, whereas my own will contribute to swifter, more effective implementation of the bill. Therefore, I ask that members support my amendment and vote against amendment 1.

I move amendment 39.

Andy Wightman

I lodged amendment 1 in order to bring a debate on the question of commencement to the committee. Section 13 of the bill, which is entitled “Commencement”, says that only it and section 14—the short title—shall

“come into force on the day after Royal Assent.”

My view is that bills that are enacted by the Parliament should come into force as soon as possible, otherwise, the operability of the legislation that the Parliament passes is left in the gift of ministers.

Mr Stewart correctly drew attention to sections 2, 3, 4 and 5, which cannot come into force the day after royal assent, but he has been silent on sections 6, 7, 8, 9, 10, 11 and 12. I appreciate that amendments have been made to the bill today, and that further amendments will no doubt be brought at stage 3, which may have some consequences for commencement. However, in the absence of any argument as to why sections 6 onwards cannot be brought into force, I invite the minister, in winding up, to let me know whether he has any problems with commencing sections 6 onwards and for his view on a stage 3 amendment that would bring the remainder of the bill into force on the day after royal assent.

Kevin Stewart

Mr Wightman wants me to make commitments on parts of the bill that we have dealt with only today. I need to go back and reflect on the exact implications for the bill as a whole of what has happened in committee today.

I will take an intervention from Mr Wightman.

Andy Wightman

I appreciate what the minister has just said, and I agree. I suppose that I was seeking reassurance that, having reflected properly on its content, the minister will be content for any section of the bill that can come into force on the day after royal assent to do so.

Kevin Stewart

I will reflect, but I assure the committee that, as I said in response to its report, the Scottish Government has no intention of causing any unnecessary delay to the commencement of the bill’s provisions. Once the bill becomes an act, my intention would be to implement its substantive provisions as soon as is reasonably practicable. However, as I have said, the timetable for that is not fully within the Government’s control as it is reliant on the Parliament agreeing affirmative regulations.

I reiterate that my amendment 39 will allow us to press ahead swiftly with consultation on the enhanced heating regime, which will enable the new definition to become operable sooner. It would be perverse if all the previous consultation work on the issue had to be discarded simply because of the point in time at which it concluded. Therefore, I ask the committee to support my amendment 39 and to reject Mr Wightman’s amendment 1. I reassure you all that, as I said in my response to the committee, the Scottish Government has no intention of causing any unnecessary delay to the commencement of the bill’s provisions.

Amendment 39 agreed to.

Section 11, as amended, agreed to.

Section 12—Consequential modifications

Amendment 40 moved—[Kevin Stewart]—and agreed to.

Section 12, as amended, agreed to.

After section 12

Amendment 41 moved—[Kevin Stewart]—and agreed to.

Section 13—Commencement

Amendment 42 moved—[Kevin Stewart]—and agreed to.

Amendment 1 not moved.

Section 13, as amended, agreed to.

Section 14—Short title

Amendment 43 moved—[Kevin Stewart]—and agreed to.

Section 14, as amended, agreed to.

Long Title

Amendment 44 moved—[Kevin Stewart]—and agreed to.

Amendment 2 not moved.

Long title, as amended, agreed to.

The Convener

That ends stage 2 consideration of the bill. Congratulations.

Thanks very much, minister.

Kevin Stewart

Thank you, convener, and thanks to the committee for its co-operation.

The Convener

We will have a short break to allow the witnesses to leave.

10:53 Meeting suspended.  10:57 On resuming—  

Fuel Poverty (Scotland) Bill with Stage 2 changes

Additional related information from the Scottish Government on the Bill

Stage 3 - Final changes and vote

MSPs can propose further changes to the Bill and then vote on each of these. Finally, they vote on whether the Bill should become law.

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