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Households Braced For Expensive “New Normal” As Higher Energy Bills Kick In

Energy bills have risen by at least £67 per month this April (Alamy)

4 min read

Cost of living campaigners have urged government not to allow a "new normal" of high gas and electricity bills, which will increase by at least £67 this month.

Last year the government introduced a range of measures to help households meet rising costs, exacerbated by the end of lockdown and Russia's invasion of Ukraine. These included a £400 rebate through its Energy Bill Support Scheme (EBSS) paid in six instalments and capping the average yearly energy bill at £2,500 through the Energy Price Guarantee (EPG).

The EBSS has now ended, meaning people will resume paying full bills from April, and while the EPG has been extended for three months, prices remain 120 per cent higher than they were 18 months ago. 

Cost of living campaigners have warned that the end of the £400 rebate leaves households on lowest incomes facing turmoil. Simon Francis, coordinator of the End Fuel Poverty Coalition, told PoliticsHome he believed people were being "taken for fools" by being charged elevated prices. 

"Homes across the country will be in for a big shock [after] this weekend," said Francis.

"Everyone's energy will be £67 a month more expensive as the government withdraws a key plank of the energy bills support programme overnight.

"In addition, changes to the Ofgem rules come in which will see the standing charges that people pay everyday just to access the grid shoot up 64 per cent.

"Britain's broken energy system continues to hit households hard and we will see levels of energy debt increase to record levels as people struggle to cope."

National Energy Action (NEA) has warned that elevated prices should not become entrenched for households struggling with rising costs. 

“From 1 April, the £66 or £67 a month Energy Bills Support Scheme ends," head of policy at NEA, Matt Copeland, told PoliticsHome.

"This means that while the Energy Price Guarantee is staying at £2,500 a year on average, households will be getting less support from the government.

"On top of that, the standing charge is increasing from 1 April, which will adversely affect lower energy users, which includes many low-income households.

"We also cannot forget that just two years ago, energy bills were less than half what they are now. We cannot accept this as the new normal.

“The UK government needs to work with Ofgem to introduce a social tariff in the energy market to protect low-income households going forward."

Last month NEA warned that 7.5 million UK households will be in fuel poverty when the £400 rebate from the EBSS comes to an end, up from 6.7 million.

Dame Maragaret Hodge, MP for Barking which has the second highest level of fuel poverty of any constituency in England at 47.7 per cent of households, accused the government of having the wrong priorities amid the rising cost of living. 

"Half of the children living in Barking and Dagenham are growing up in poverty," Hodge told PoliticsHome.

"So dealing with yet more hikes in their heating bills simply adds to the pressures and strains on families trying to do their best for their children. 

"What is so scandalous is that the government chose to prioritise another tax cut for the wealthiest by lifting pension relief levels rather than giving more support to those struggling the most with making ends meet."

Shadow chief secretary to the Treasury Pat McFadden, who's constituency has the fourth highest level of fuel poverty in England at 47.1 per cent, said help with the cost of living "should be the top priority for the government right now". 

“The fall in living standards over the past two years is the biggest in living memory," McFadden told PoliticsHome

“When you add everything up, household bills have increased by about £3,500 a year over the past few years.  

“The rises in energy bills have hit people particularly hard. In a constituency like mine where many people live on low incomes it’s harder and harder for people to make ends meet."

The latest increase in energy bills comes alongside April increases in council tax, water bills, and other utility bills like mobile phone or broadband contracts. 

 

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