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Minister says Welsh Gov doing ‘everything we can’ to support people in cost of living crisis

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Following regulator Ofgem’s announcement that it will be increasing the domestic energy tariff cap by 54% from 1 April, Welsh Government Social Justice Minister, Jane Hutt has said that a typical household’s dual fuel energy bill will rise to almost £2,000 a year.

The minister described this as “a very worrying time for people”.

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In a written statement, Jane Hutt MS said that “Energy bills have been fuelling the cost-of-living crisis we are all currently experiencing” and that “there are few signs of this crisis easing.”

The energy price cap, which was raised in October, has helped to shield households from some of the worst of the cost increases in the domestic electricity and gas market over the winter months, which has seen a large number of suppliers fall into administration.

But it has not been enough to protect households, particularly low-income households, from ever-increasing energy costs. National Energy Action has calculated some 22,500 more households in Wales have been pushed into fuel poverty by the October increase.

Jane Hutt MS said: “This further rise in the price cap by OFGEM in April risks pushing tens of thousands more families into fuel poverty.

“The UK Government’s immediate solution appears to be to load even more costs onto consumers’ bills. Its energy bills rebate will provide a £200 discount to electricity bills only from October, which will then be automatically recovered from people’s bills in £40 instalments over the next five years.

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“It has also announced a £150 council tax rebate for homes in bands A to D in England from April. Wales will receive a funding consequential as a result of this announcement. We are considering how to target this at those who need it most. A further announcement will be made in due course.

“We are doing everything we can to support people in Wales with the cost-of-living crisis and rising energy bills, including doubling the Winter Fuel Support Payment to £200 and making increasing investment in our Discretionary Assistance Fund to help people who need urgent and emergency support.

“It is time the UK Government acted to support households and to address the turmoil in the domestic energy markets.”

The Welsh Conservatives meanwhile are calling on the Labour-run Welsh Government to use the newly announced £175m from the UK Government to give families a council tax rebate and ease of cost of living crisis.

Following Ofgem’s confirmation today that the energy price cap will rise by £700 from April, the Chancellor, Rishi Sunak, has announced a three-part plan to help with household fuel bills immediately and protect people against half of this increase – worth £350 per household, in a total package of support worth £8.6 billion across the United Kingdom.

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The plan includes a £200 ‘smoothing’ rebate on energy bills for all households across Britain, to be paid back over the next five years at £40 per year – starting from April 2023.

It also includes a non-repayable £150 cash rebate for homes in Council Tax bands A-D – equivalent to 80 per cent of all households, helping both lower and middle-income families.

There’s also £144 million of discretionary funding for local authorities to support households not eligible for the council tax rebate.

Points two and three of the plan are devolved and will see the Labour administration in Cardiff Bay receive an extra £175m in consequential funding.

Welsh Conservative Senedd leader, Andrew RT Davies MS, said: “As the British economy continues its recovery from the pandemic, we must confront the global inflationary pressures caused by the world economy coming swiftly back to life.

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“Much of this inflation is being driven by the rising cost of energy due to increased demand worldwide – and that is feeding through into pressures on the cost of living at home.

“Soaring energy bills are a major worry for hardworking families across Wales and the UK and the Conservative Chancellor has once again stepped up to the plate to help people in a time of need.

“With Labour ministers in Cardiff Bay set to receive £175 million as a result of the Chancellor’s action plan, it’s vital they use this money immediately to fund tax rebates and create a discretionary fund for local authorities to use on households who do not meet the criteria.

Jane Hutt MS, the Welsh Government Social Justice Minister said that she and Lee Waters MS, the Welsh Government Minister for Climate Change, had written jointly to the Secretary of State for Business, Energy and Industrial Strategy, setting out a series of actions that they want the UK Government to take to support households with their energy bills.

These include removing the social policy costs imposed on household energy bills and move them to general taxation; Introducing a differentiated domestic energy tariff cap or social energy tariff targeted to better support lower income households; and provide further and increased support through the Warm Home Discount and other winter fuel payment schemes.

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The letter also calls on the UK Government to expand the ability of suppliers to write off household energy debt and introduce a match-funding element to the scheme, with the costs met by the UK Government; and Increase Local Housing Allowance rates.

The minister also called for a windfall tax on North Sea oil and gas producers as a means of measures to helping people through this cost-of-living crisis.

Jane Hutt added: “The cost-of-energy crisis and the wider cost-of-living crisis extends beyond any action the Welsh Government can take alone. We have expressed our concern to the UK Government and will continue to do so.

“Urgent action is needed to relieve bill payers from these very high energy prices.”

Meanwhile, Citizens Advice Cymru say that support on energy bills is “strange, complicated and untargeted”.

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Rebecca Woolley, Director of Citizens Advice Cymru said: “The package of measures announced by the UK Government will provide some relief for all households in April, but it doesn’t go far enough for people on low incomes.

“Energy rebates are a buy now pay later solution which only provide temporary relief later this year. And if the proposed reduction on Council Tax was introduced along similar lines in Wales, our analysis suggests that around 230,000 households on the lowest income may not benefit at all. The Welsh Government needs to intervene to make sure those who have been hit hardest by the pandemic, are not left even further behind.”

Dame Clare Moriarty, Chief Executive of Citizens Advice, added: “This is a strange, complicated and untargeted package of measures. For people on low incomes who need it most there are far easier ways for the Westminster government to deliver support. If the [UK] government is serious about helping families facing the desperate choice between heating and eating it should use the benefits system.”

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UK Government

Council looks for people’s view on how £41m funding pot should be spent in Swansea

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Worth over £41m to the city, Swansea Council want people’s views on how funding earmarked for the city should best be used in the next three years.

Swansea Council say responses to an online survey will help them develop a local investment plan aimed at addressing the city’s needs and making the most of its opportunities.

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Feedback from residents and businesses is needed on a number of key themes by midnight on Sunday July 17. These include communities and place, supporting local business, and people and skills.

Once finalised, the local investment plan will then help inform a regional investment plan for South West Wales, which is aimed at unlocking £138m of UK Government Shared Prosperity Fund money that’s already been set aside for the region.

Swansea is set to benefit from £34.4m of this core funding, as well as a further £7.2m to improve the numeracy skills of adults.

The Shared Prosperity Fund is the main source of UK Government funding replacing the European Regional Development Fund and European Social Fund that are no longer available following the UK’s withdrawal from the European Union, although it is not a direct like-for-like replacement. 

Cllr Robert Francis-Davies, Swansea Council’s Cabinet Member for Investment, Regeneration and Tourism, said: “Many organisations throughout Swansea made use of EU funds, so we know they’re interested in helping us decide how this funding should best be used over the next three years. 

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“Other people and organisations will have their own views too, which is why everyone is being encouraged to fill out the survey that’s now live on the council website.

“This is an opportunity to help determine how millions of pounds of money will best be spent to boost our communities, businesses and skills, so I’d invite as many people as possible to have their say.”

The regional investment plan will be submitted to the UK Government by August 1 for approval in the autumn.

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Welsh Government

Development Bank of Wales announces £33 million for greener housing

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Residential developers who meet green standards can now access a new Green Homes Incentive that will help deliver more thermally efficient and lower carbon homes in Wales.

Funded by the Welsh Government, the Green Homes Incentive is available on residential development loans from Development Bank’s Wales Property Development and Wales Stalled Sites Funds and includes a reduction in loan repayment fees of up to 2%.

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Finance for up to 100% of building costs is available with interest rolled-up throughout the loan term. Eligibility will depend upon qualifying criteria that includes EPC A Rating/Passivhaus status, non-concrete structures and non-fossil fuel heating systems.

The operation of buildings accounts for around 30% of emissions in the UK, mainly from heating, cooling and electricity use.  For new buildings, the embodied emissions from construction can account for up to half of the carbon impacts associated with the building over its lifecycle.

The latest RICS data (2020) shows 77% of all new builds in Wales achieved an EPC B rating, with only 5% achieving an A rating. Additional insulation, double/triple glazing and solar panels can all help to improve EPC ratings.

It is also widely accepted that alternative structures such as timber frames, hempcrete blocks, limecrete blocks and mycelium bricks have a lower carbon impact than concrete. The use of timber frames has become more commonplace over the last decade but recent global pressures on timber cost and availability have led to a number of developers reverting to concrete hence the need for financial incentives.

Developers that install non-fossil fuel heating systems will also be able to benefit from the new incentive as ground and air source heat pumps significantly reduce operational energy demand during the life of a property.

Minister for Climate Change, Julie James said: “Tackling the climate emergency must be at the heart of everything we do in Wales as we all work together across this decade of action.

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“The Green Homes Incentive will support SME housebuilders in delivering low carbon homes, part of our journey to a Net Zero Wales by 2050.

“Finding innovative ways to improve the energy efficiency of new homes will also bring down costs for homeowners which is crucial as we help people through a cost of living crisis.”

Giles Thorley, Chief Executive of the Development Bank of Wales

Giles Thorley, Chief Executive of the Development Bank said: “Sustainable business is at the heart of our core principles, so we want to support developers making the change to greener development practices as part of the Team Wales effort to build a stronger, greener economy.

“Our Green Homes Incentive offers reduced lending costs for housing schemes that will help to deliver more thermally efficient and lower carbon homes in Wales. It’s the first of several initiatives as we look to support the journey to net zero with funding that helps forward-thinking companies to address climate change.”

Cenydd Rowlands, Property Director at the Development Bank, said: “We are already seeing examples of developers wanting to make the change towards more eco-friendly options particularly given the upcoming changes in building regulations which are likely to impose higher eco-standards across all new schemes.

“We know the importance developers place on certainty of funding.  This has become even more important of late given the additional uncertainties around other key elements of development, such as supply availability and material cost inflation. Our dedicated property team is here to help with a quick decision-making process that is designed to get more developers building greener housing as quickly and efficiently as possible.”

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Cardiff-based developers Wellspring Homes hope to use the Green Homes Incentive for their next development. Using local contractors, the company is close to completing the construction of its first property built using Hempcrete, a natural ‘better than zero carbon’ material that is breathable. Planning permission has been granted for their next development in Neath that will feature eight low-carbon homes. With an A grade energy rating, all will have solid wall construction using Hempcrete and will be fitted with air source heat pumps.

Director Hadleigh Hobbs said: “We’ve got an opportunity to build housing differently in Wales by using more innovative methods of construction to deliver the next generation of living space. Each one of our homes is being built using solid Hempcrete walls. This gives really good thermal mass with its unique properties helping to store and release heat from the building’s walls, limiting fluctuations in temperature, reducing energy costs and virtually eliminating condensation by releasing internal moisture. The use of hemp within the walls also locks up carbon dioxide in the structure of the building.

“However, funding is essential for our industry if we’re going to scale-up and deliver more low carbon homes in Wales. This is what will enable us to refine the technology and make the homes of the future commercially viable.  The Development Bank understands this challenge and is now able to offer the support needed to drive down carbon emissions with the development of new homes that are well-built, beautiful to live in and beneficial to our natural environment.”

(Lead image: Wellspring Homes)

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Tourism

New planning rules and licensing scheme for second home and holiday accommodation in Wales

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The Welsh Government have announced new planning laws, a statutory licensing scheme and proposals to change land transaction tax as part of a package of measures aimed at addressing numbers of second homes in Wales.

First Minister Mark Drakeford and leader of Plaid Cymru Adam Price set out the next steps in a programme of actions to help create thriving communities and to support people to afford a home, in a joint press conference today (Monday 4 July).

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The Co-operation Agreement between the Welsh Government and Plaid Cymru includes a commitment to tackle the issue of second homes affecting many communities in Wales.

The package of measures being announced today includes changes to planning regulations by the end of the summer. These will introduce three new planning use classes – a primary home, a second home and short-term holiday accommodation. Local planning authorities, where they have evidence, will be able to make amendments to the planning system to require planning permission for change of use from one class to another. The will also be changes to national planning policy to give local authorities the ability to control the number of second homes and holiday lets in any community.

Also announced were plans to introduce a statutory licensing scheme for all visitor accommodation, including short-term holiday lets, making it a requirement to obtain a license. The Welsh Government say this additional regulation will help raise standards across the tourism industry.

Following a consultation about varying land transaction tax (the Welsh version of Stamp Duty) locally in areas with large numbers of second homes, the Welsh Government announced that work will start today (Monday 4 July) with local authorities to develop a national framework so they can request increased land transaction tax rates for second homes and holiday lets to be applied in their local area.

The Welsh Government say they have already introduced a range of measures to address the issue of second homes, including giving councils the discretionary power to increase council tax premiums on second and empty homes and it has changed the rules on holiday lets so owners and operators make a fair contribution to their local communities.

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First Minister Mark Drakeford said: “We are today setting out the next steps in a radical programme to ensure everyone has the opportunity to afford to live in their local community – whether that’s buying or renting a home.

“We have a shared ambition for Wales to be a nation of thriving communities – a country where people do not have to leave to find good and rewarding work and a country which people want to come to visit and to live.

“Tourism is vital to our economy but having too many holiday properties and second homes, which are empty for much of the year, does not make for healthy local communities and prices people out of the local housing market.

“There is no single, simple solution to these issues. Any action we take must be fair. We do not want to create any unintended consequences, which could destabilise the wider housing market or make it harder for people to rent or buy.”

Plaid Cymru Leader Adam Price said: “We are committed to using a range of planning, taxation and property levers to tackle the issue of second and unaffordable homes – and to do so with urgency.

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“The package of purposeful measures that have been developed as a result of the constructive cooperation between Plaid Cymru and the Government in this area will, together, begin to address the injustices in our housing system and make a real difference to people and communities right across our nation.

“The aim is to give everyone ‘yr hawl i fyw adra’– the ability to live and work in the communities in which they grew up.”

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