D-DAY ON PRICES AGONY
» Energy bills to soar & Govt aid not enough » £30-a-month rise will put 1 in 4 Brits in crisis » Concern interest rates will go up and hit millions
A SURGE in energy prices that could slap an extra £53 a month on bills is to be announced today.
But a Mirror poll found a rise of just £30 would plunge one in four families into crisis.
Rishi Sunak is reported to be poised to offer multi-billion pound loans to suppliers to help ease the energy bills blow. But experts warn that will not be enough to save many struggling households from misery. One said: “Millions will be thrown into fuel poverty.” The Bank of England could announce a rise in interest rates today, adding to the agony.
AS families suffer from the cost of living crisis, soaring energy bills and the threat of a rise in interest rates are set to pile on even more misery.
Up to 22 million households face more hardship as regulator Ofgem confirmed it will bring forward an announcement on a price cap to today.
It could spark a £53-a-month leap in bills from April, as a Mirror survey found one in four families fear even a £30 hike will plunge them into poverty.
And experts warn a reported multi-billion pound package of loans to suppliers to help knock off around £200 off the expected £638 annual rise will not be enough to help many escape fuel poverty. One branded Boris Johnson and Rishi Sunak’s plan a “cheap stunt”.
Citizens Advice revealed the number of people seeking support over a financial crisis, including referrals to foodbanks, is the highest level on record.
Chief executive Dame Clare Moriarty said: “Cost of living pressures are at boiling point. April’s price hikes haven’t yet hit and already people are turning to our services in record numbers.
“Advisers are hearing desperate stories of families living in just one room to keep warm, people turning off their fridges to save money and others relying on hot water bottles instead of heating due to fears about mounting bills. Our data has reached red alert levels.” Reports claim No10’s taxpayer-backed loans to suppliers would have to be paid back, but with the cash recouped from customers over time, potentially years. National Energy Action chief executive Adam Scorer said: “Their ‘heat now, pay later’ plan, in isolation, will not be sufficient to protect the most vulnerable customers.
“We need an 18-month plan to avert, not smooth, the crisis. This is a long way from being an adequate solution to avert a fuel poverty catastrophe.” Energy and Utilities Alliance chief executive Mike Foster added: “The scale of the energy price cap increase is shocking. Millions more
households will now be thrown into fuel poverty, through no fault of their own.
“The proposed loan to energy companies to keep bills £200 lower now, but to be paid back later, is a cheap stunt.
“Consumers will still be paying huge sums, if not now, later. The misery of high bills will now drag on for years.”
Joe Malinowski founder of the price comparison website TheEnergyShop.com said: “The price cap has already bankrupted over half of all energy suppliers in the market. Now it is set to bankrupt the consumer.”
To add to the misery, the Bank of England will also announce at midday today any interest rate hike.
A Deltapoll survey for the Mirror found the cost of living crisis was now the biggest concern for the public, overtaking Covid for the first time since the start of the pandemic. An overwhelming 83% are worried about soaring energy bills.
And 9% of respondents said they were already in “extreme financial difficulties”, from not having enough to buy food to missing rent or mortgage payments. Forecasters warn the price cap for those on standard and other default tariffs will rocket by 50%, from an average £1,277 to £1,915 a year. That is just over £53 a month. More than half of those quizzed in our poll said they would end up in financial trouble if their energy bills rose by up to £50 a month.
The Mirror has heard from readers whose monthly payments have already jumped by far more than that.
Trade body Energy UK chief for the household energy executive Emma Pinchbeck said: “Suppliers have been providing hundreds of millions in pounds in financial assistance since the start of the pandemic and will continue to do all they can to help customers struggling with their bills. “When international gas prices are this high, there is a need for Government to act.”
It is unclear if the reported £200 rebates from loans would go to every household, vary by usage, come in one go or be spread out. Targeted measures for poorer households are also expected, including an extension of the Warm Homes Discount. No10 said: “We recognise people are facing pressures with the cost of living, which is why we are providing support worth £12billion. We are supporting vulnerable households through initiatives such as the Household Support Fund and Warm Home Discount and will continue to listen on how to manage energy costs. “We will provide an update on further help for households to meet their energy costs in the face of rising global gas prices.”
Deltapoll interviewed 1,515 adults online between January 25 and 27. Data is weighted to be representative of the adult population as a whole. The Mirror is calling for the 5% VAT on energy to be ditched, that would save the average household around £100 a year from April.
People are living in one room to keep warm. Cost of living pressures are at boiling point
DAME CLARE MORIARTY CITIZENS ADVICE CHIEF EXECUTIVE
TODAY regulator Ofgem will give energy firms the green light to hike prices further.
As a result, households nationwide face eyewatering rises in their heating costs at a time when food and fuel prices are also soaring.
The Government’s proposed solution is to give taxpayer-funded loans to the energy companies to fund a rebate on household bills.
This will offer only temporary help as the firms will have to increase charges further down the line in order to repay the loans.
A far better answer is to cut VAT on fuel and impose a windfall tax on the oil and gas giants.
The Government is not tackling the cost of living crisis, but protracting it.