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Clarity sought on Budget off-grid impact

Following last week's announcement of the 2023 Budget the Countryside Alliance noted that questions remained over its impact on rural areas and specifically, households off the gas grid. We have since written to the Chancellor of the Exchequer to raise the question directly.

In our letter we thanked the Chancellor for his efforts to share the proceeds of economic recovery with rural areas. We especially welcomed the maintenance of the fuel duty cut, given the importance of personal travel to rural communities. We asked, however, for some clarification as to where the extension of the Energy Price Guarantee leaves households off the gas grid that have hitherto been supported through Alternative Fuel Payments.

The Alternative Fuel Payments scheme was introduced in recognition of the fact that households off the gas grid and reliant on alternative fuels such as heating oil would not be able to benefit from Energy Price Guarantee support in respect of their heating costs. The Budget Statement, however, made no specific mention of any extension to Alternative Fuel Payments. The Red Book makes a minor reference, as follows:

"The Department for Energy Security and Net Zero plans in 2022-23 exclude… £0.7 billion of funding for Alternative Fuel Payments. In 2023-24, plans for the Department for Energy Security and Net Zero exclude £50 million of funding for Alternative Fuel Payments, and plans for the Reserves exclude… £72 million for Alternative Fuel Payments…"

This would seem to suggest that the Treasury anticipates some level of expenditure with respect to Alternative Fuel Payments, but it is unclear whether this will represent any further payments made following the extension to the Energy Price Guarantee. We continue to believe that households off the gas grid, which are predominantly located in rural areas, should receive equivalent levels of support.

We therefore sought clarification to assist us in gauging our wider reaction to the Budget.

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