- Friday, 20 April 2012
New research from Consumer Focus shows four in 10 people say their winter energy bill is even higher than last year,1 with almost a third saying their bill is higher than expected.2 This is despite one of the mildest winters in a decade which resulted in falls in energy consumption. The figures are particularly striking among those who pay by cash, cheque, or prepayment meter – many of whom live on low incomes. Over half of these customers say their winter energy bill is more expensive than last year.
Lower heating use over the mild winter will have cut energy bills for some customers. But for those who haven’t been able to reduce their heating, particularly those on low incomes who have already cut back as much as they can to make ends meet, higher prices than last winter could have left them with unexpected bill increases. Most energy firms’ price cuts didn’t come into effect until late winter – so at the start of January 2012 the average annual amount of energy cost over £180 more than the year before.3
Consumer Focus and Citizens Advice are warning that these unexpectedly high bills could push more people into debt with their energy supplier – particularly those on low fixed incomes, such as older people and families receiving benefits. As part of their ‘Plug the Debt’ campaign, the organisations are urging any customer struggling to afford their energy bill to get in touch with their energy firm and to contact Citizens Advice for help and information.
Almost half of consumers (48%) already plan to make cut-backs in order to afford their energy bill, this is even higher among prepayment meter customers, with six in 10 planning to cut-back. Of those cutting back almost half plan to reduce the amount of energy they use, around a third will cut back on seeing friends and family, holidays and goods such as clothes and music. Almost one in seven of all consumers plan to cut back on food, with one in five of the poorest consumers having to cut back on eating to afford heating.
Worryingly the new findings also show that if energy prices rise further many more people think they will be unable to afford to pay their bill.4 A third of people say they could not afford to pay if their monthly bill rises by £30 and over half could not afford to pay if their monthly bill was to rise by £50. One in eight people, and one in four pre-payment meter customers, said they couldn’t afford to pay their bill if it rose by even £10 or less per month.
Mike O’Connor, Chief Executive of Consumer Focus, said:
‘With energy price cuts and less heating used because of the mild weather, most people will have expected their winter energy bill to be lower this year. So higher winter bills may come as a nasty shock that many customers simply can’t afford. We’d urge anyone struggling to pay their bill to contact their energy firm and Citizen’s Advice as soon as possible. The sooner you get in touch the less chance there is for debts to build and become harder to repay.’
Gillian Guy, Citizens Advice Chief Executive, said:
'High energy bills are stretching some household budgets to breaking point. If you are worried you can’t afford to pay your bills and they are mounting up – don’t suffer in silence. Speak to your energy supplier as they have a duty to make sure you are repaying what you can afford. Citizens Advice Bureaux can also help you to find out what help is out there to cut your bills and claim any benefits you could be entitled to.’
Consumer Focus and Citizens Advice are making people aware of the following five top tips if they fall behind with their bills:
- Always contact your energy firm as soon as you realise you might have trouble with paying. Debts will build-up and be harder to pay off the longer you leave them. Your supplier has a responsibility to help you if you have problems paying your bill.
- Tell your energy supplier what you can afford to pay – they have to take this into account in agreeing repayments of the money you owe.
- Ask your energy company, your local Citizens Advice Bureau or call the Home Heat Helpline 0800 33 66 99 to find out about other free energy help available. For example you could qualify for a discount off your bill or free insulation to help your home stop leaking heat and cut your bills.
- Even if you are in debt you may still be able to switch to a cheaper deal with your current supplier, especially if you pay by cash, cheque or prepayment meter. If you pay by pre-payment meter and have less than £200 of debt you can also switch to a cheaper deal with another supplier.
- Financial help is available which could make it easier to afford your bills – check you are receiving all of the benefits and tax credits you are entitled to by getting in touch with your local Citizens Advice Bureau or visiting www.adviceguide.org.uk.
Anyone who wants to find out more about getting help or advice through the ‘Plug the Debt’ campaign should visit www.consumerfocus.org.uk/plugthedebt or contact their local Citizens Advice Bureau.
Other advice and information
For impartial advice and information on energy issues get in touch with your local Citizens Advice Bureau or the Citizens Advice Consumer Service on 08454 04 05 06.
Information on how consumers can save money on their energy bills by switching payment type, tariff or supplier and insulating their home, is available on the DirectGov website energy advice pages. Helpful information can also be found on the Citizens Advice Big Energy Week webpages and adviceguide. You can also find out online about the Energy Best Deal campaign that Citizens Advice runs with Ofgem and watch a series of short films on how to get the best deal.
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