Dominic Little on the impact of rising energy bills on families
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New figures emerged this week warning that the energy price cap (maximum annual tariff) could reach around £3,400 in October. And in January, this could even soar to almost £4,000 as the energy crisis deepens, utilities consultants BFY warned. While the Government is stepping in with a winter discount and other handouts to ease the cost of living crisis, an industry expert has said it is crucial that Westminster “thinks sharply” before bills rise again.
He told Express.co.uk: “We will know shortly what the price cap will be from October and that is expected to go over £3,000.
“The Government has got to look at the type of intervention they announced earlier this year to cope with an increase in bills under £3,000.
“With them going over £3,000, clearly something else has got to be done.
“Government intervention in dealing with the price was too slow, primarily because once the price has been announced by Ofgem, energy suppliers immediately ramp up their direct debits and the majority of billpayers pay by direct debit.
“So we were paying the increased cost before the price cap even came in because annual adjustments are made through the direct debit. We were getting warned that this was going to happen before any revenue was there for us as consumers.
“The Government need to think more sharply about putting things in place at the time when Ofgem announces its latest price cap change, which will be in a couple of weeks’ time.”
But Westminster’s £400 non-repayable discount will offer some relief for around 29 million households from October.
The Energy Bills Support Scheme is part of the Government’s £37million Cost of Living Support package, which is aimed at providing support for the most vulnerable households as prices continue to soar.
The £400 discount will be administered by energy suppliers and will be paid to consumers over six months, with payments starting from October 2022.
Monthly discounts will start from £66, which will be deducted from energy bills in October and November.
This will then rise to £67 each month from December until March 2023.
Business and Energy Secretary Kwasi Kwarteng said: “People across the country are understandably worried about the global rise in energy costs, and the pressure this is placing on everyday bills.
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“While no Government can control global gas prices, we have a responsibility to step in where we can and this significant £400 discount on energy bills we’re providing will go some way to help millions of families over the colder months.”
The new Chancellor, Nadhim Zahawi, said: “We know that people are struggling with rising energy prices which is why we have taken action with support over the winter months to help ease the pressure on household budgets.
“This £400 off energy bills is part of our £37billion of help for households, including eight million of the most vulnerable households receiving £1,200 of direct support to help with the cost of living.
“We know there are tough times ahead and we will continue to do everything in our power to help people.”
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