Some good news – and some astonishingly bad news – for students

Jim Dickinson has been reading the impact assessment for the Energy Prices Bill. And you'll never guess what happened next

Jim is an Associate Editor at Wonkhe

So as surely almost everyone knows, a while back the government introduced something it called the Energy Bills Support Scheme.

That’s the official name for the £400 being given to every household this winter via their domestic energy company.

That scheme – and the commitment to deliver it for every household in the country – raised two headscratchers for students.

Tell me your troubles and doubts

The first is students who pay rent which is inclusive of [energy] bills. Landlords have been arguing that it’s them that have faced the increased costs, and so it’s them that should keep the £400.

But many of those landlords have “all inclusive” contracts where a “fair use” clause allows them to charge students extra if they go over a fixed allowance, expressed either in kWh or cash.

For the former, landlords are demanding they keep the cash. For the latter, they’re just loading the extra costs onto student tenants.

The legality of the clauses that allow them to do so is a specific and serious question – the Competition and Markets Authority (CMA) says that terms that do this are supposed to clearly set out information to enable the consumer to foresee what price will be payable depending on the circumstances.

And it says these sorts of clauses may only be fair if consumers are genuinely free to escape its effects by ending the contract without experiencing financial loss or serious inconvenience where one of the factors relevant to the genuineness of a right to cancel is practical difficulties in finding an alternative supplier and whether the market is competitive! You can draw your own conclusions about the private rental market.

Now clearly landlords would argue that they couldn’t have foreseen the rises either, but from a student perspective that’s hardly the point. What we don’t have is any test cases or guidance from the CMA on that (showing just as much interest in students as it did during the pandemic), and advice on the issue either hedges its bets or comes from organisations who themselves are landlords.

Giving everything inside and out and

Anyway, I digress. On that £400 issue the good news is that the government has legislated to require landlords to pass on the cash via the Energy Prices Act, which obtained Royal Assent on Tuesday.

There are still some regs to be laid and getting detail on practicalities out of BEIS is like getting blood out of a stone, but the topline is that students will be entitled to have the £400 passed on.

Universities and SUs will have a job on imminently to explain the scheme and help students prize it from the hands of landlords who will be keen to threaten students with Section 21 evictions if they dare.

That all however leaves another question. Given the £400 goes to households on a domestic energy supply, what about those not in that situation?

You know. Care home residents. People in park homes. House boats at residential moorings. Travellers on authorised fixed sites. Energy consumers who live off the grid. And students – in both university and private halls.

Love’s strange, so real in the dark

The good news is that there was a statutory consultation on the EBSS over the summer. Responses included that certain groups would be likely not receive the grant due to their lack of a domestic electricity contract, responses agreed that it was important for these consumers to also receive support offered to a similar timeframe, and responses specifically mentioned both those in supported living and student accommodation with inclusive bills.

The government response was that for affected households without a domestic electricity supply contract, funding would be made available as soon as possible:

We are developing approaches that will ensure they receive £400 equivalent support for energy bills this winter, working with local authorities, the devolved administrations and commercial partners. An announcement with details on how and when these households across Great Britain can access this support will be made this autumn.

Reaffirming this, in July, Nadhim Zahawi announced that funding would be available to provide “equivalent support” of £400 for energy bills for the “1% of households who will not be reached through the EBSS”, via something by then labelled the “Energy Bill Support Scheme Alternative Fund”.

It specifically said that this would include those who do not have a domestic electricity meter or a direct relationship with an energy supplier, “such as park home residents”. And it said an announcement with details on how and when these households across Great Britain would be able to access the support would be made “this Autumn”.

I didn’t chase much at the time, assuming that some detail would emerge soon enough – but as the weeks went on things started to cause me some alarm. Legally, every student in halls is in their own household – but given that circa 550,000 students are in halls, there’s no way there’s 55m households in Britain. Maybe a typo, I thought.

For a while I was thinking that they’d invent some wheeze to cluster students into notional households as we saw during Covid, and that an announcement would emerge. But nothing.

As the weeks have gone on, it’s been noticeable that as usual, wherever a question in the commons comes up about students and cost of living, it gets given to DfE rather than to BEIS or the Treasury. And crucially stock answers from Andrea Jenkyns have been mentioning the Energy Bills Support Scheme, but mysteriously not the Energy Bill Support Scheme Alternative Fund. But I put that down to the detail not being briefed to the relevant DfE team.

Think of the tender things that we were working on

So late last week, I started to step up my efforts at getting an answer out of the Department for Education, the Department for Levelling Up, Housing and Communities or the Department for Business, Energy & Industrial Strategy – but the first two kept pointing me at BEIS, and BEIS have promised me an answer and then not delivered it repeatedly. Maybe it’s all the ministerial chaos, I thought.

Then this evening, having had another fob off from the BEIS press office, I had cause to dig out the official impact assessment for the Energy Bills Support Scheme component of the Bill. You may need a drink for this part.

It says that certain groups won’t benefit from the EBSS because they do not have a domestic meter point and a direct relationship with an electricity supplier. That’s students in halls.

It says the government has previously announced that further funding would be available through winter 2022/23 to help those not be reached by the EBSS. That’s students in halls.

The EBSS Alternative Fund (AF) will be, it says, funding that will provide a £400 energy bill grant to households that meet some specific criteria:

  • “The dwelling for which support is being claimed is the main or sole residential address of the applicant making the claim.” That’s a student in halls.
  • “The resident or applicant (if someone else manages the application on their behalf) is responsible for paying for energy used in the dwelling as part of a service charge, rent or other arrangement.” That’s a student in halls.
  • “The household is not already benefiting from EBSS payments.” That’s a student in halls.
  • “The applicant is not a business with a commercial supply arrangement or within business premises, with the exception of businesses whose main business activity is to provide long term residential accommodation (landlords, etc.) applying on behalf of their residents.” That covers students in halls.

But then it says that based on these criteria it estimates that between 740,000 and 886,000 households will be eligible for support from the alternative fund. Does that include students in halls?

For that answer, I scanned down to Table 12, marked “available evidence on the number of homes outside of scope of EBSS”. And guess what:

That’s right. They appear to have forgotten about over half a million students living in halls.

Rain keeps falling, rain keeps falling

Does this explain why BEIS has been slow to respond to my chasing? Does it have an answer or a decent explanation? Has the student finance team at DfE not even noticed? I’d put a quote in here from a government department or minister if I could, but answers haven’t exactly been forthcoming.

I really thought I’d seen it all during the pandemic, and then earlier in the year when students were repeatedly missed out of schemes designed for everyone else, or when they were taken for granted when the nation blithely assumed that students would pay rent on halls that we told them not to use in case they spread Covid.

But if it really is the case that the government has remembered residents of care homes, housing association tenants, park home people, house boaters, travellers and those off the grid – but has forgotten 550,000 students – then this is probably the most egregious example of treating students like dirt I’ve seen in my career.

The big question now is whether, when the fund launches, students in halls will be explicitly prevented from applying. Let’s assume that’s a yes for now.

Both politicians and civil servants – if there’s an alternative explanation or you fancy clarifying the entitlement position, do suggest that the BEIS press office drops a reply to one of my emails, and I’ll be happy to correct the above.

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