Skip to main content

Lords Committee questions whether people most in need will receive the full relief they are entitled to under the Government’s Energy Support Schemes

25 November 2022

In its 18th Report of Session 2022-23 the cross-party House of Lords Secondary Legislation Scrutiny Committee highlighted various issues after considering three statutory instruments laid under the Energy Prices Act 2022 as part of a package of secondary legislation intended to deliver the Government’s support for both households and businesses with their energy costs during the current energy crisis.

The relevant instruments are the; Energy Bills Support Scheme and Energy Price Guarantee Pass-through Requirement (England and Wales and Scotland) Regulations 2022 (SI 2022/1102), the Energy Bill Relief Scheme Pass-through Requirement (England and Wales and Scotland) Regulations 2022 (SI 2022/1103) and the Energy Bill Relief Scheme and Energy Price Guarantee Pass-through Requirement and Miscellaneous Amendments Regulations 2022 (SI 2022/1125).

The three instruments are intended to ensure that landlords and other intermediaries who have received benefits from the Energy Price Guarantee, Energy Bills Support Scheme and/or Energy Bill Relief Scheme pass these benefits on to tenants and other end users, including vulnerable customers.

While the Committee lauded the original intention of the Government’s intervention, it expressed concern about how effectively the system devised by these instruments would operate in practice. The Committee felt that the requirement for landlords and intermediaries to pass on benefits in a “just and reasonable way” seemed so vague and open to interpretation as to appear meaningless. The Committee also took issue with the expectation that tenants or end users would have to initiate debt recovery through the County Courts if they felt any benefit passed on to them was inadequate. The Committee found that the complicated, costly and time-consuming nature of court proceedings would likely act as a deterrent to people in such scenarios, especially the most vulnerable. Tenants would be unlikely to want to take their own landlords to court.

The Department for Business, Energy and Industrial Strategy (BEIS) provided various assurances around the methods landlords or intermediaries would use to communicate with tenants and end-users about passing on any benefits and the provision of guidance for those wishing to initiate legal proceedings. However, the Committee remained unconvinced and noted there could be an “inequality of arms”, especially between a landlord of multiple properties and individual tenants, particularly in the case of the most vulnerable.

In conclusion, the Committee contrasted the complexity of the system devised by these instruments with the more accessible arrangements put in place for customers of heat networks where individuals can complain to the relevant energy ombudsman in order to seek redress and suggested the House may wish to question the BEIS Minister further on this.

Lord Hutton of Furness, Member of the Secondary Legislation Scrutiny Committee, said;

“While there appear to be good intentions behind these statutory instruments, they appear too complicated to deliver the intended support or relief. It is impracticable to expect tenants to pursue their landlords through the civil court system where they believe inadequate benefits have been passed on, especially in the case of vulnerable tenants such as the disabled or elderly. The cost and the complexity of doing so would surely act as a deterrent no matter the guidance provided under Government schemes and may mean that the most vulnerable customers are most at risk of losing out from the full support they should receive.

“In addition, we are unconvinced by the explanation and assurances provided by BEIS and remain uneasy about the requirement for landlords to pass on support to their customers in a “just and reasonable” way. Whatever this may mean, it adds another layer of complexity to the system because it is vague and open to interpretation.

We have suggested that the House press the BEIS Minister further on the issues raised, especially considering the more accessible routes available for customers of heat networks who can complain to the relevant energy ombudsman scheme.”