7m in ‘missing middle’ will struggle to pay bills

MILLIONS of middle-class earners face crisis-level energy bills with no financial help, research has found.

They do not claim benefits or a pension so lack state support.

And without any aid they will suffer real hardship as they struggle to pay power costs this winter.

This is despite some earning salaries of almost £40,000.

Twelve million households would face unaffordable utility bills even with the price cap of £3,000 a year.

However, around three-quarters of those households get welfare benefits or the state pension, meaning they qualify for government payments.

That leaves three million households who face fuel poverty because they spend more than 10 per cent of their income on fuel.

Yet this group will not get benefits or pensions and therefore do not qualify for extra financial help.

Cracks

Based on 2.4 people per household, that means there are 7.2 million people in the “missing middle” of energy bill policies. Many of those who lose out are on mid-range incomes, the study by the Social Market Foundation think-tank and the Public First consultancy found.

Sixteen per cent of households earning between £21,453 and £26,523 will spend 10 per cent of income on energy but not get extra support.

The figure is 12 per cent for those earning between £26,538 to £32,465 and 11 per cent for those earning between £32,471 to £39,003.

The report shows that using the state pension alongside benefits to decide who gets help means that around one in three households in the richest 10 per cent will receive government support.

Dame Clare Moriarty, chief executive of Citizens Advice, said: “This research shows the Government must come up with a clear plan to ensure people in need don’t fall through the cracks of support measures.”

Politicians must install long-term policies to provide targeted financial support for millions of households for what could be “a decade of painfully high energy bills”, the report said. From April 2023 until March 2024, the Government’s energy price guarantee will keep typical bills at £3,000.

But rising wholesale gas and electricity costs mean bills will remain at similar levels for several years.

The research – done as part of a joint project with Citizens Advice – also shows a major drive to increase the energy efficiency of Britain’s badly insulated homes would significantly cut energy bills. Upgrading all 14.1 million UK homes rated with low energy efficiency would cost around £119billion and deliver annual energy bill savings of £10.2billion.

A policy seeking to upgrade 3.2 million homes whose residents have low incomes would cost around £27billion, delivering annual savings of £3billion.

Across the 5,000 UK adults questioned for the report, 77 per cent back such a scheme.

Forty per cent of respondents preferred such help to be targeted at those on lower incomes – while 54 per cent said it should be available to everyone.

Meanwhile, research by water watchdog Ofwat shows a surge in customers saying they are struggling to pay their bills – up from 15 per cent to 20 per cent.

Dr Claire Forbes, of Ofwat, said: “As winter approaches, water companies must ensure they are supporting their customers and informing them of help available.”