11 Accepted

Universal support schemes led to deadweight costs, reducing overall value for money.

Conclusion
Most of the £44 billion of support was provided through schemes that were universal in nature, which means that some people who did not need the support still received it, affecting the schemes’ overall value for money.21 Written evidence we received from Octopus Energy, for example, said that while the decision to provide universal support was necessary for the Department to move at pace, it resulted in higher than necessary costs.22 The support provided also did not match the support that was needed, as lower–income households received the same level of support as higher– income households.23 The Department told us that there were advantages 15 Q 16; C&AG’s Report, para 3.3 16 Qq 12, 16 17 Q 20 18 Q 17; C&AG’s Report, para 3.3 19 Q 17 20 Q 9 21 Q 12; C&AG’s Report, para 12, 4.2 22 EBS0003 23 C&AG’s Report, para 12, 4.2 9 in having broad–based schemes, as the “sheer scale of the price rises” meant that the number of households affected was so high that a universal intervention was required.24 But the Department acknowledged that it had to accept the risk of ‘deadweight’ in the schemes in order to introduce the schemes quickly.25
Government Response Summary
The government agrees with the committee's observation and commits to reviewing options for better targeting of future bill support beyond March 2026. It will also explore how better data use and sharing can improve the targeting of economic support and is leading a working group on energy affordability and accessibility.
Government Response
Accepted
HM Government Accepted
2.1 The government agrees with the Committee’s recommendation. Target implementation date: September 2025 2.2 The Warm Home Discount provides targeted support to over 3 million low-income and fuel poor households in Great Britain, and the government has consulted on expanding the scheme to support more households. The government works with energy suppliers to identify eligible households in England and Wales through data matching, providing most of the rebates automatically. The current Warm Home Discount scheme runs to March 2026. The government is taking the opportunity to review options for better targeting of future bill support beyond this point. 2.3 Better access to data is critical for identifying households and providing them support automatically, and the government committed in the Autumn Budget 2024 to exploring how better data use and sharing can improve the targeting of economic support, particularly in times of crisis. These are complex matters, and the department is working closely with other government departments, energy suppliers, and stakeholders to consider options for improving data sharing and data matching. The Minister for Energy Consumers is also leading a working group with Energy UK and other stakeholders to consider how the department can take further sustained action on improving affordability and accessibility of energy.
Addressee Bodies
HM Treasury
Timeline
Recommendation age 1.3 yr
Report published 28 Mar 2025