Low-income families on benefits will receive £150 off their energy bills every winter for the rest of the decade.
The Warm Home Discount, which offers a rebate on bills for those on means-tested benefits, will be extended until 2030-31, the Government will confirm on Friday.
It follows last year’s expansion of the scheme to bring the number of eligible households to about six million.
The discount is applied to all households who are receiving a qualifying means-tested welfare payment, such as housing benefits, universal credit or pension credit.
In England and Wales, people should get the discount automatically as long as their supplier has more than 1,000 customers.
Currently, those in Scotland must generally apply for the rebate via their energy suppliers.
Separate changes will reform how the policy is administered so that more families receive it automatically next winter.
Ministers want to make it easier for people in Scotland to receive the rebate.
Energy Secretary Ed Miliband said extending the scheme, following a public consultation, was about helping families deal with “the affordability crisis”, which he described as the “Government’s number one priority”.
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“That will give families much-needed peace of mind that they will continue to receive vital support, as we take action to bring down bills for good,” he said.
The Government has promised to boost household finances for struggling families, but persistently high energy prices are continuing to put budgets under strain.
The average energy bill for a household reached £1,758 a year this winter and, from 1 January, the energy price cap increased again by 0.2 per cent.
This rise was partly driven by the funding of nuclear power projects and discounts to some lower-income households’ winter bills, watchdog Ofgem said.
Independent Age said the rebate should be increased to £400 to “better reflect the real cost of heating a home”. The group, which advocates for older people, said this should be funded directly by the Government to ensure the cost is not put onto other people’s energy bills.
Ministers already announced that £150 would be cut from the average household bill from April by scrapping the Energy Company Obligation (Eco) scheme.
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Matt Copeland, head of policy and public affairs at National Energy Action, welcomed the extension of the discount but said there must also be support and advice for those who are not within the benefit system.
Last week, the Government unveiled its £15bn Warm Homes Plan designed to replace a series of previous schemes to support people to make their houses more energy efficient.
Under the plan, households earning less than £35,000 will be able to claim free solar panels, heat pumps and other home upgrades and low-cost loans will be offered to everyone else.
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