Households facing “no-win scenario” as energy price cap rises to £3,549
Money Advice Trust responds to Ofgem’s energy price cap increase
Posted August 26, 2022
Ofgem has today announced that its energy price cap will increase to £3,549 from 1st October, an increase of 80 percent compared to April’s level.
More than four in ten (45 percent) of callers to National Debtline have a deficit budget where they already do not have enough coming in to cover essential costs. The Charity is calling for urgent targeted support for people caught at the sharp end of this crisis to help them afford energy bills this winter.
Joanna Elson CBE, chief executive of the Money Advice Trust, the charity that runs National Debtline and Business Debtline, said:
“Millions of households are facing a no-win scenario – and as the price cap continues to rise, the need for further support is becoming ever more urgent. The Government needs to come up with solutions for the many people for whom this situation is simply unaffordable. This could include significantly raising benefits and introducing direct additional support to households on the lowest incomes.
“Ofgem also needs to do more to protect households by ensuring suppliers treat people who are struggling or already in energy arrears fairly and halting potentially harmful debt collection practices.
“This energy crisis is proving catastrophic for small businesses too. The Government needs to explore every option available to help small businesses cope with soaring energy costs – or risk many thousands failing to get through the winter.
“Anyone worried about their finances should contact a free debt advice service, like National Debtline or Business Debtline.”
Alongside StepChange Debt Charity and Citizens Advice, the Money Advice Trust has called on the energy regulator Ofgem to increase protections for people in or at risk of energy arrears. The charities full set of recommendations are outlined in ‘Rising energy prices: Protecting energy customers in debt’ briefing.
