Government announces Warm Home Discount eligibility changes removing disabled people

In August 2022 the government announced changes to the Warm Home Discount that would remove eligibility for anyone in receipt of disability benefits who does not also claim an income-replacement benefit¹. The changes were due to come into force in November 2022 and, according to the disability charity Sense, would remove entitlement to the discount from nearly 200,000 disabled people¹.

The announcement came during a year of steep increases in the energy price cap, the maximum amount energy providers can charge consumers. Ofgem announced in February 2022 that the cap would rise from April to £1,971 a year, an increase of 54 per cent, and in late August announced a further rise taking effect from October that would have increased the cap by 80 per cent to £3,549 a year¹. The government then introduced the Energy Price Guarantee, a subsidy keeping the annual cost of energy for a household with average consumption at £2,500 for the two years from October 2022¹.

Alongside the guarantee, the government announced a £400 discount to energy bills for winter 2022-23, a £150 council tax rebate for homes in bands A to D in England, payments totalling £650 for people receiving income-related benefits, a £150 one-off payment for people receiving disability benefits, and a £300 one-off payment for people who qualify for a Winter Fuel Payment¹.

Sense's research, produced with the National Centre for Social Research and based on 2020-21 Family Resource Survey data, found that almost a quarter (24 per cent) of people with complex disabilities were unable to keep their home adequately warm, compared with 8 per cent of those with a different disability and 3 per cent of those with no disability¹. Seven in ten (69 per cent) people with complex disabilities had less than £1,500 in savings, against 53 per cent of people with another disability and 33 per cent of those with no disability¹. Only 13 per cent of people with complex disabilities were in full-time work, and nearly a third (29 per cent) were drawing on support from Universal Credit¹.

The briefing defines someone as having complex disabilities if they have two or more of sight loss, hearing loss, autism and learning disability, and report that their life is impacted by their disabilities¹.

Why it matters for households

The change affects people who receive disability benefits such as Personal Independence Payment but do not claim an income-replacement benefit such as Universal Credit or Employment and Support Allowance. Under the August 2022 announcement, that group would no longer qualify for the Warm Home Discount from November 2022, with Sense estimating nearly 200,000 disabled people would lose entitlement¹. The £150 one-off payment for people receiving disability benefits was announced separately and is not the same as the discount¹.

Sense's figures indicate the group affected was already under financial pressure before the change: 82 per cent of people with complex disabilities of working age were unemployed, compared with 53 per cent of those with another type of disability and 23 per cent of non-disabled people¹. Disabled people generally were three times more likely (13 per cent) to be behind on bills or debts than those with no disability (4 per cent), and three times more likely to be food insecure (17 per cent, against 5 per cent)¹.

The briefing states that even with the Energy Price Guarantee and the bill discounts, typical households still faced a 64 per cent increase in energy bills compared with the previous winter, citing analysis from Money Saving Expert¹. It also notes that at the time of writing the government had not committed to uprating benefits in line with inflation in spring 2023, and that the standard rate of Universal Credit had risen by 7.5 per cent since 2013 while inflation had risen by 22.9 per cent over the same period¹.

What happens next

The eligibility changes were due to come into force in November 2022¹. The Energy Price Guarantee was set to hold the annual cost of energy for a household with average consumption at £2,500 for two years from October 2022¹. Sense reports that further increases to the price cap had been expected through 2023¹. The briefing does not report a government decision on benefit uprating for spring 2023¹.