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Gordon Brown & energy giants agree £910m package to help people with rising gas and electricity bills.

The £910m package of measures it to include half price insulation for all households and a freeze on this year's bills for the poorest families. of

According to the BBC

Pensioners and families with children under five will get an extra £16.50 a week if there is a severe winter.

But the measures were attacked as "ridiculous" by the unions, who want a windfall tax on the energy giants.

The package includes:

• Free cavity wall and loft insulation for pensioners and poor households
• 50% off cost off insulation for all households
• Freeze on this year's bills for half a million poor consumers
• Partial reversal of cut to warm front programme giving free central heating to poorest pensioners
• Cold weather payments to go up from £8.50 a week to £25 a week for pensioners, the disabled and families with children under five - if temperatures drop below zero for seven consecutive days
• The government says its aim is to insulate every home in Britain by 2020 - and energy companies, councils and voluntary organisations will be making door-to-door visits in deprived areas to promote the scheme.

Half-baked measures such as these are not going to address the social emergency of fuel poverty

Help the Aged

"This is the right approach, giving priority to permanent - not just one-off - changes, with the offer of lasting benefits and fairness for all families, cutting bills permanently every year," said Mr Brown at his monthly Downing Street press office

The prime minister said this was a "better way" than bringing in the one-off cash rebates for consumers paid for by a windfall tax on energy firms demanded by trade unions.

Energy-saving measures in the home

The package will cost the energy companies £910m but Mr Brown stressed he did not want to see that passed on to consumers.

And, for the first time, power generators such as Drax will contribute, as well as the big energy providers.

Mr Brown also hit out at a joke made by Mark Owen-Lloyd, boss of energy company E.On, after he said continued high gas and energy prices would mean "more money for us".

The prime minister said: "I understand that there has been an apology from the company.

"These were totally inappropriate remarks, I think everybody is against people making remarks like that, and I'm pleased that there has now been a full and comprehensive apology."

'Financial help'

Environment Secretary Hilary Benn said: "The government has a longstanding commitment to help those living in fuel poverty, but recent price rises mean we are committed to do even more to assist people in reducing their bills where possible."

But he said the number of people who would be helped by the overall package would depend on the number of people who came forward for assistance.

Lucy French explains her struggle with power bills

Last week Mr Benn denied "caving in" to the firms, by not insisting on cash rebates for people to help with bills immediately.

The government argues that more long-term measures are needed - average household electricity bills are expected to increase to more than £500 per year by 2010, and gas bills to around £900.

Fuel poverty

But Help the Aged said the package would do little to help older people struggling to cope with soaring fuel bills.

Mervyn Kohler, special adviser to the charity, said: "Half-baked measures such as these are not going to address the social emergency of fuel poverty."

And the trade unions repeated their demand for immediate relief for consumers facing soaring bills and a windfall tax.

Derek Simpson, joint leader of Britain's biggest union, Unite, said: "It is ridiculous to believe these measures are a partial or complete solution."

Thursday's announcement follows a National Housing Federation report suggesting that almost a quarter of people will be in fuel poverty by next year - defined as spending more than 10% of their income on energy bills.

The Conservatives said Mr Brown had actually cut the budget for energy efficiency grants for people on benefit last year, and was simply restoring the budget.

Shadow business secretary Alan Duncan said: "People who will really struggle to heat their homes this winter have been waiting for months for this announcement - but now it's become clear that Labour has got nothing to offer."

For the Liberal Democrats, Vince Cable told BBC Radio 4's The World Tonight that while the measures leaked so far appeared "very sensible" the money involved was "a tiny fraction" of the amount energy companies had raised as a result of being given free carbon trading permits by the government.

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