Definitions and Targets - Scotland

The current Scottish definition of fuel poverty is that a household is in fuel poverty if, in order to maintain a satisfactory heating regime, it would be required to spend more than 10% of its income on all household fuel use. If over 20% of income is required, then this is termed as being in extreme fuel poverty.

The Housing (Scotland) Act 2001 set a statutory duty on the Scottish Government to eradicate fuel poverty in Scotland, as far as was reasonably practicable, by November 2016. This statutory duty expired and the target was missed.

On 27th June 2018, in response to recommendations put forward by the Fuel Poverty Strategic Working Group and the Rural Fuel Poverty Task Force, and informed by an expert review and a public consultation, the Scottish Government published the Fuel Poverty (Target, Definition and Strategy) (Scotland) Bill. This was previously known as the Warm Homes Bill. This Bill will:

  • Set a new target to eradicate fuel poverty
  • Introduce a new definition of fuel poverty that will focus on low income households
  • Develop a new long-term fuel poverty strategy

The proposed fuel poverty statutory target is to ensure that, by 2040, no more than 5% of households in Scotland will be in fuel poverty. The Scottish Government intends that the Energy Efficient Scotland programme will be the primary delivery mechanism for eradicating fuel poverty by 2040. There are two non-statutory interim targets at 2030 and 2040.

Under the proposed new definition, a household must fulfil both the following criteria:

  • Its required fuel costs must be more than 10% of household net income after deducting housing costs and;
  • The remaining household net income after the payment of fuel costs and childcare costs (if any) must also be insufficient to maintain an acceptable standard of living for the household.

Underpinning the definition, income will be calculated using the UK Minimum Income Standard (MIS). This will be set at 90% of this standard, after the costs for fuel, housing, council tax, water rates and childcare are deducted. The 10% fuel cost to income ratio will move from Before Housing Costs (BHC) to be based on an After Housing Costs (AHC) basis. In addition, the temperature regime will be enhanced for those most affected by the adverse outcomes of living in a cold, damp home. For these households, the other rooms’ temperature in the heating regime for the new definition increases from 18°C to 20°C compared to the 10% definition while the living room temperature is maintained at 23°C.

Local Authorities

Local Authorities were also obligated under the Housing (Scotland) Act (section 89) to produce local housing strategies (LHS), setting out the measures they would put in place to ensure ‘so far as reasonably practicable, that persons do not live in fuel poverty’.

Scottish Government Local Housing Strategy Guidance provides information on reporting requirements. There is also a Sustainable Housing Advice Note which provides further information on fuel poverty and climate change.

 As part of the development of Energy Efficient Scotland, the Scottish Government has been consulting on Local Heat and Energy Efficient Strategies (LHEES) in 2018 and a response is expected soon.