Fair By Design responds to consultation on eliminating poverty premiums

Fair By Design responded on 28 October 2024 to Ofgem's consultation on its consumer vulnerability strategy, saying it answered in line with its goal of eliminating poverty premiums¹. The organisation campaigns on the extra costs low-income households pay for essential goods and services, a subject covered in our guide to the poverty premium and low-income pricing.

The response page carries only a short summary of the submission. It states: "We respond to this consultation in line with our goal of eliminating poverty premiums in…"¹. No further detail of the consumer vulnerability strategy response, and no figures, have been reported¹.

Fair By Design's positions on energy affordability and debt are set out in more detail in its response to Ofgem's separate call for input on affordability and debt, published 13 June 2024¹. There it called on the government to introduce a discounted tariff for households unable to afford the energy they need, to create a temporary Help to Repay scheme for people in energy arrears, and to scrap VAT on energy bills¹. It called on Ofgem to eliminate the standard credit premium, reduce standing charges, and tackle back-billing so consumers do not face shock bills going back up to a year¹.

The organisation has also responded to Ofgem's call for evidence on prepayment meter rules and protections for domestic consumers, published 13 February 2023². That page likewise carries a brief summary and a link to the full submission, without figures².

Why it matters for households

Poverty premiums are the extra amounts low-income households pay for the same goods and services, including energy. The measures Fair By Design has asked for would affect how energy is priced and paid for: a discounted or social tariff for households that cannot afford the energy they need, lower standing charges, the removal of the standard credit premium, and protection from back-billing¹. It has also welcomed Ofgem's proposal for a debt relief scheme and backed a temporary Help to Repay scheme for households in arrears¹.

The consumer vulnerability strategy response itself does not set out which of these measures, if any, Ofgem has adopted, and no timetable for the strategy has been reported¹. The dates on which any of the proposed changes would take effect have not been reported¹.

What happens next

Ofgem has not published an outcome of the consumer vulnerability strategy consultation in the material available, and no date for a decision has been reported¹.