Government urged not to leave off-grid rural households behind in the budget
Okehampton-based heating oil supplier Moorland Fuels is urging the Government to ensure that any proposed VAT cuts on domestic energy bills are applied equally to both rural off-grid households using heating oil and those connected to mains gas or electricity.
The call comes amid a lack of clarity around the Chancellor’s proposed plans to ease the cost of living by removing the 5% VAT rate on part or all of domestic energy bills.
Abby Turner, Director at Moorland Fuels, explained: “High energy bills are always a concern for householders, particularly as we enter the chillier winter months. For households across the South West thoughts will be turning to the cost of keeping their homes warm, which is why news of a potential reduction in VAT on energy bills, which could save the average household around £80 a year, would be widely welcomed.
“However, full details of the Chancellor’s proposals remain unclear, which leaves us concerned that households and farmhouses dependent on heating oil may not benefit if the VAT exemption is limited only to mains gas and electricity.
“That’s why we are urging the Government to provide clarification and not to leave rural off-grid communities behind in the Budget. This is particularly important as wages in rural areas are typically lower than the national average, and there is a real danger that households which rely on heating oil could be financially disadvantaged simply because they don’t live in an urban area.”
“Failing to include heating oil users in the planned VAT reduction would understandably cause great upset among users throughout Devon and Cornwall, leaving them feeling left behind and ignored,” added Turner.
“On a £500 order for heating oil, a 5% VAT cut would save £25, which is a meaningful amount for families and retirees struggling to make ends meet. Our worry,” said Turner, “is that some households could be holding off to see if the budget will result in lower heating oil bills, and in the process cold risk running out.
“That’s why clarification on the proposed VAT is so important, allowing customers to decide whether to top up now or wait until after the Autumn Budget.”
The business, which last year introduced a new 300-litre minimum order option for State Age pensioners in response to the Government’s decision to end Winter Fuel Payments has since extended this to members of its Cosy Heating Club. This move was designed to help reduce the impact of fuel bills on pensioners and Direct Debit customers, by allowing customers to spread the cost of top-ups through smaller orders.
Unusual in the heating oil sector, where the standard minimum order is 500 litres, this move has led to a shift in buying habits. Many of Moorland Fuels’ customers are now choosing smaller deliveries to help spread costs of their heating oil deliveries in the run-up to the Budget, particularly following a recent hike in the price of heating oil resulting from President Trump’s implementation of sanctions on two of Russia’s largest oil companies and the recent Ukrainian drone strikes against Russian oil ports.
Turner explained: “While prices remain broadly in line with last year, customers need greater certainty about what lies ahead. Without that being in place many could run the risk of running their tanks down before ordering.
“The danger here is that if tanks are allowed to run too low sludge could be drawn from the bottom of the tank damaging heating systems just when heating is needed most. As well as leading to a cold and damp house, this could result in an expensive and unwanted engineer bill, which could be more expensive than ordering a small delivery. Our message is clear. Check your tank and if it is low, don’t hesitate, just order now.”
www.moorlandfuels.co.uk
