As the temperature plunges, we’re all turning up the heat – and so are MPs on the vexed issue of energy prices. Ed Miliband’s pledge to freeze energy prices feels like a dim and distant memory from the party conference season. But the political controversy he created is still raging in the Commons and beyond. On the back foot, David Cameron has been desperate to prove he’s on the householder’s side – rather than an honorary member of the Big Six.
He made the startling claim that fuel poverty went up under Labour and that his administration has “maintained the winter fuel payments” and “increased the cold weather payments”.
True, or a load of hot air?
Well, it turns out there are two definitions of fuel poverty. Using one definition, fuel poverty did go up under Labour, but using the other, it went down. Until earlier this year, the standard definition of fuel poverty was spending more than 10% of household income on fuel to heat your home adequately. By that calculation, fuel poverty did indeed go up under the last government. In 2003, 5.9% of households were classed as “fuel poor” and that figure kept going up until it peaked at 18.4% in 2009.
It turns out there are two definitions of fuel poverty. In one, it went up under Labour, but in the other, it went down
But this year, a professor at the London School of Economics proposed a new definition. If fuel costs are above the national average, leaving the householder below the poverty line, he or she is declared “fuel poor”. It’s that measure the government has said it will use. And according to the new calculation, fuel poverty actually fell under Labour, to 11.5% of households in 2009.
So what of the winter fuel payments? The previous government introduced additional payments of £50 to £100, but the coalition axed them. The result was that total spending on the winter fuel payments fell from £2.9bn in 2010/11 to £2.2bn in 2011/12.
On the cold weather payments, though – paid out when the temperature drops to zero or below for at least a week – David Cameron was spot on.
Incidentally, for anyone keen on a bright future, the energy secretary Ed Davey reckons he has it sussed. He heralded a deal with French energy company EDF to build Britain’s first new nuclear power station in 25 years as “essential to keep the lights on”. Let’s leave aside for the moment the fact that the Lib Dem minister’s own party rejected nuclear power as too expensive in its election manifesto. What the FactCheck team takes issue with is the suggestion that Hinkley C is vital to illuminate the nation. The industry regulator Ofgem predicted that energy capacity would hit a low in two or three years, and after that the situation will improve. So when the new station opens for business in 2023, Ofgem forecasts the crisis will have passed.
The government’s nuclear investment may be proving controversial, but it’s nothing compared to the hoo-hah over HS2. You can tell ministers are having a job persuading the country – let alone the opposition – that a new high-speed rail line is all it’s cracked up to be, because they’ve now published the economic case for the venture an astonishing five times. This latest attempt revises some of the costs, but crucially still claims that the benefits outweigh the costs. To use the jargon, there’s a benefit cost ratio (or BCR if you want to speak like a Whitehall suit) of 2.5 to 1. To you and me, that means the new project will generate £2.50 in benefits for every £1 of public money used.
The government claims that’s “similar to Crossrail and higher than the benefit cost ratio for some other major projects when approved, such as Thameslink and the Jubilee Line extension”.
The Fat FactCheck Controller has something to say about that. Because the BCR for HS2 (wow that’s a lot of acronyms) includes estimates of “wider economic benefits”, which make it a bit easier for the government to argue its financial case. And what’s really cheeky is that the BCR for the other big rail projects cited by ministers didn’t include the wider economic benefits.
You can see all our investigations at the FactCheck site. The mental energy you generate might stop you having to turn the heating up.
Cathy Newman presents Channel 4 News and runs the FactCheck blog which can be found on channel4.com/factcheck