Energy suppliers failing the poor
14/02/2008
As householders reel under inflation-busting rises in energy prices, the companies that supply our heat and light have come under attack for failing the most vulnerable members of society.
According to the watchdog organization “energywatch”, Britain’s energy supply companies currently spend just 0.11% of their £24billion turnover on measures which offer direct assistance with the cost of energy to fuel poor households.
energywatch says it has uncovered massive differences in the approach, commitment and investment of Britain’s ‘Big Six’ suppliers towards the least well off in society – which includes millions of people dependent on pensions and benefits.
At a time when rising prices are pushing average annual bills well over the £1,000 mark, support is only reaching 1 in 15 of the four million British households living in fuel poverty.
But the situation is even worse than that. Suppliers are supposed to offer “social tariffs” to support the poorest members of society, but those offered by some suppliers are actually more expensive than their cheapest tariffs - available to better-off people who pay by direct debits.
While EDF Energy, for instance, has a social tariff £151 cheaper than its other rates, the British Gas rate for the poorest members of society is actually £96 more expensive. Since 2003, British Gas customers have seen their bills go up by 76.7% for gas (from £370 to £653) and by 74.3% for electricity (from £237 to £413)
Swingeing increases
Lib Dem MP Steve Webb has raised the issue at Prime Minister’s Question Time in the House of Commons and told Mature Times: “Fuel bills already take up a big slice of the income of many retired people, and these latest hikes will make matters worse.
“The best solution of all is a dramatic improvement in home insulation and home energy efficiency, which will cut bills and benefit the environment.
“We also need the Government to force energy companies to offer special tariffs for people who are elderly or vulnerable to protect them from these swingeing increases. There should be an investigation into the energy companies themselves who seem to be quick to pass on price rises - but a lot slower to pass on falls in their raw material costs.
“The Government has said it will end what it calls 'fuel poverty', but all the evidence is that this will be another missed target.”
His words were echoed by Gordon Lishman, Director General of Age Concern, who told us: “The government is already failing to meet its fuel poverty targets, and many thousands more older people will be pushed into fuel poverty by this latest round of price increases.
“The government and energy companies must do more to address the huge pressure expensive fuel bills place on the poorest. Social tariffs are important in enabling vulnerable groups to be able to afford heating their homes.
“We want energy companies to ensure that their low income customers are protected from price increases and aren’t penalised for being poor, for example through paying higher rates for pre-payment meters. We also want the government to require all energy companies to offer social tariffs to vulnerable households.”
Mr Lishman has also asked us to urge all older people who are worried about their escalating bills to contact their local Age Concern for advice on benefits they may be missing out on. To find your nearest Age Concern, call 0800 00 99 66.
energywatch is also advising householders to consider switching suppliers if better tariffs are available elsewhere. A link to the uSwitch comparison website is below.