Energy Companies Warn That Price Hike Will Leave "Even Average Households" Struggling To Pay Bills
4 min read
The chief executive of Britain’s energy trade association has warned that “even average households will struggle to pay their bills” as the price cap on energy is set to rise in April.
Ofgem, the UK’s energy regulator, is expected to announce an increase to the cap on gas prices to the maximum possible threshold, which could add up to £700 to the annual energy bill of 22 million households.
Energy UK’s Emma Pinchbeck said this morning that the industry is “incredibly worried” about the impact on households.
“We work closely with consumer groups and we know that because of the worry there is and because of the sheer inability to pay, we’ve got record numbers of calls going into our call centre," she told BBC Breakfast.
Her concerns have been echoed by shadow chief secretary to the treasury, Pat McFadden, who told Sky News on Thursday morning that price hike “is just one part of a triple whammy that's coming at households”.
“These are shocking levels of increases,” McFadden said.
“I’ve been on the doorstep in recent weeks and people are really worried about this,” he added.
“They don’t know how they’re going to pay and even before these rises had been announced people have been so fearful, they’ve been turning their heating off.”
On Wednesday evening The Times reported that government-funded council tax rebates will be offered to households in bands A to C in an effort to alleviate the burden of the cap hike on low-income households.
The chancellor is due to confirm the plan and other possible measures for easing the cost-of-living crisis in the Commons at 11.30 am.
Speaking on LBC this morning, foreign office minister James Cleverly said that government recognises “the real-world impact” of soaring energy prices.
“We are very conscious of how much this will hurt some people,” the minister said.
“The chancellor has taken a very close interest and we’ll have to wait for him to make a formal announcement.”
Labour has argued that the government should impose a one-off windfall tax on North Sea oil and gas profits to tackle energy price hikes.
Companies including Shell have benefited significantly from rising gas costs, with the energy giant’s annual profit having surged to £17 billion amid soaring prices for consumers.
"With oil and gas profits booming in recent months because of the spike in energy prices, it is clearer than ever that the North Sea oil and gas producers who have made a fortune recently should be asked to contribute,” shadow climate and net zero secretary Ed Miliband said.
Under the windfall-tax proposal, households would save £200 off their bills, with “targeted support” of up to £400 on top of that for “the squeezed middle, pensioners and the lowest earners”.
“It will tell you all you need to know about where government stands if it again rejects this proposal which could help the British people through this crisis,” Miliband wrote on social media.
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