Call for energy firms to “give poor customers a fair deal”

29 August 2008

Campaigners push for Government to act

Campaigners have today said that the Government needs to force energy firms to dip into their profits to lessen the burden on the 5.5 million households set to be living in fuel poverty this winter.

A household is considered to be living in fuel poverty if it spends more than 10% of its annual income on gas and electricity costs. The recent price increases have pushed the average annual dual fuel bill up to just under £1,500 and have therefore increased the number of fuel-poor households.

The ‘big six’ energy companies made more than twice as much profit in 2007 when compared to 2006, increasing from £2.07bn in 2006 to £4.3bn in 2007.

However, the amount they contributed to social tariffs, which give their most ‘vulnerable’ customers the cheapest prices, decreased as a percentage of their profits, from 1.9% in 2006 to 1.2% in 2007.

A new coalition of charities, comprising of Age Concern, Child Poverty Action Group and National Energy Action (NEA), have now called on the Government to force energy suppliers to offer fuel-poor households a better deal on currently increasing energy prices. Until now the Government has allowed energy firms to take a ‘voluntary’ approach to helping their most vulnerable customers.

Maria Wardrobe of the NEA said: “Social tariffs are failing to help the most vulnerable households.

“Only a minority of those in fuel poverty are on these tariffs and the rates are not always the cheapest offered by energy suppliers.

“The tariffs are not sufficiently publicised and are not included on price comparison websites.

“The Government must address this injustice and force suppliers to offer poor and vulnerable households their cheapest prices,” she added.

Paul Dornan at Child Poverty Action Group said: “We cannot have families huddling in the cold this winter inside their homes which they can’t afford to heat.

“The voluntary approach is failing and government and the energy companies need a plan of action within weeks to ensure the millions of fuel-poor households are on social tariffs in time for winter,” he added.