Heating subsidy misses target as money diverted away from fuel poor areas

23rd Sep 2022


Early results from the Government’s troubled £450 million Boiler Upgrade Scheme (BUS) suggest taxpayer funds are being diverted away from areas with high levels of fuel poverty to wealthier parts of the country. Key regions such as London, the West Midlands, North East, and North West look like losing out to the South East and South West.

Analysis conducted by the not-for-profit trade body the Energy and Utilities Alliance (EUA) suggests that if the early trend continues, London is set to be the biggest loser, missing out on £46 million; the North West by £21 million; West Midlands by £15 million and the North East by £6 million. The biggest winner will be the South West up by £41 million and the South East receiving £16 million more than if the money was allocated fairly across all regions. 

The EUA compared the regional allocation of cash from the BUS made up to the end of July with the number of properties in each region, and found the disparity in allocation. To make matters worse, the regions missing out contain the highest levels of fuel poor homes in the country, meaning the taxpayers’ cash is not helping those most in need. 

Mike Foster, CEO of Energy and Utilities Alliance commented: 

“The energy price crisis has not gone away, despite the recent support announced by the new Prime Minister. While we welcome her intent, beneath the surface Whitehall still spends hard-earned taxpayers’ money on schemes that divert money away from where it would do most good.” 

“The Boiler Upgrade Scheme is subsidising people who frankly do not need help with their bills. Giving the well-off £5000 subsidies if they can afford to spend £13,000 on new heating systems just seems perverse when millions will struggle to pay their bills this winter.”

“The upshot is some regions will be losing tens of £ millions by the government trying to meet an arbitrary target set by the previous PM to subsidise new heating systems for a small minority, when the vast majority struggle to pay their bills.” 

“And paying 90,000 households over the next three years £5000 a time to do something they would have done anyway, is the very definition of wasting taxpayers’ money. That money could be better spent insulating homes right across every region in the country, permanently reducing both bills and carbon emissions.”