In the affluent south London borough of Wandsworth, the average residents earns more than £52,000 a year – above the national average – and pays less council tax than any area in England.
However, many of the borough’s residents will receive £100 payments under a new scheme from the Government to help cover the cost of soaring energy bills.
The Household Energy Payment, unveiled by Chancellor John Healey in his first Budget on Wednesday, will be paid to 20 million households in England within council tax bands A to D.
The majority of the total £2.6bn funding allocated to the scheme is expected to go to those who need it most – the support will reach roughly 80 per cent of English households, the Government estimates, including 83 per cent of fuel-stressed households and 88 per cent of the lowest-income households.
Yet there are fears that some people struggling to cope with rising bills – such as long-time residents of properties in higher council tax bands, including pensioners or others in larger homes who may have a lower income than working professionals living in smaller flats – could fall through the cracks, while payments go to wealthier individuals who may need the money less but are living in properties banded long ago.
The decision not to means test the scheme, and instead roll out the payments regardless of household income, has been met with criticism and warnings from campaigners that the payments will “barely dent” the predicted price rises coming next year.
‘It’s going to get swallowed up quite quickly’
In the leafy, family-friendly Wandsworth suburb of Earlsfield, some residents said the government-funded £100 payments were “fair” but admitted that the money was unlikely to go far – and may not go towards bill payments at all.
Alison, a 50-year-old charity fundraiser who owns and has lived in a two-bed flat in a council block with her partner for over two decades, told The i Paper: “They’re threatening to put our council tax up here in Wandsworth. So, yeah, I suppose on top of that it does seem fair.”
Wandsworth’s low council tax sums
Council tax in Wandsworth is famously low; the annual sum for a band D property in the borough is currently £1,028.21, the lowest of the 33 councils in London and indeed of the 296 councils in England.
Just under a quarter (22.2 per cent) of Wandsworth properties are in band D while more than half of properties (58.4 per cent) in the borough are between bands A and D, according to the latest data from Council Tax Challenger.
However, recent reports have suggested Conservative-held Wandsworth Council was considering raising charges by up to 160 per cent next April.
Asked how she would spend the £100 payment, Alison said: “I guess I’d see it as going towards the energy bill, even if it went in the bank and I may not be able to draw a straight line between that and it going to my energy bill.”
Alison, a long-time Earlsfield resident, said the payment ‘seems fair’ in light of rumoured council tax increases (Photo: The i Paper)Beth, a marketing manager who has lived in a three-bed house in Earlsfield since 2008 said the boost is “helpful” even if the help may not ultimately amount to much.
“Well it’s very helpful – it’s a contribution [but] I think for most of us by the time we get to December that’s going to be nothing,” she said.
“We’re lucky we’ve had a warm autumn so far, but I think as soon as it gets cold it’s going to get swallowed up quite quickly.”
Questioning the timing of the support, Beth added: “Obviously, everything is welcome… I just wonder if it’s a little bit like the horse has already bolted. Everyone’s energy bills are going up along with petrol and food.”
Gaynor, a 79-year-old retiree who has lived in her three-bed maisonette for 14 years, said: “I’m one of the lucky ones, because I bought when places here were cheap.”
Another retiree living in a three-bed, band D house admitted the £100 payment “will probably just go in the bank and be used for whatever is needed, as and when”.
Asked if they thought it was fair for them to receive the boost, they added: “I think so, but somebody has got to suffer for it. As long as it’s not being taken from a person who really needs it.”
What else do we know about the Household Energy Payment scheme?
The Chancellor had been expected to increase the Warm Home Discount, a one-off electricity bulls discount for those in receipt of qualifying benefits, by up to £100, but this was not mentioned in the Budget.
Instead, all 20 million households in council tax bands A to D – roughly three quarters of all residential properties in England, containing around 45 to 50 million individuals – will receive a one-off £100 payment intended to help cover rising bills.
The payments are expected to be distributed directly into people’s bank accounts via the council tax system from January 2027, with the devolved governments of Scotland, Wales and Northern Ireland also set to receive a share of the scheme’s £2.6bn funding.
Payments will ‘barely dent’ predicted bill rises
Campaigners have warned the payments will “barely dent” the rise in energy bills predicted to hit UK households in January.
Energy regulator Ofgem’s price cap is expected to increase by at least 26 per cent in January, rising to £2,172 a year for a typical dual-fuel household, according to predictions by comparison firm Uswitch.
Currently, the cap – and the amount the average household pays is – £1,723, meaning bills will increase by an average of £449.
The £100 payment given to all households under council tax bands A to D should, therefore, nearly cover the £112 rise people will see in their bills over the first three months of the year, before the next price cap comes in next April.
Chancellor John Healey delivered his first Budget on Wednesday (Photo: Getty)Simon Francis, co-ordinator of the End Fuel Poverty Coalition, said Healey “talked the talk on energy bills, but ultimately failed to walk the walk”.
He continued: “Wholesale gas prices have tripled since February and bills are expected to rise further during the sixth winter of high energy costs.
“Yet the only immediate support is a payment that will barely dent the predicted rise households face in January. Because it is paid directly into household accounts in England, it may not even be spent on staying warm this winter.
“We know that the majority of the public are worried about their energy bills in January, but sadly today’s Budget will do little to ease those fears.”
The Chancellor said the £100 payments, coming alongside the other Budget announcements including the abolishment of standing charges on gas bills, would give British families “breathing space” on their energy bills.
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