At least 400,000 extra British families will find themselves in “fuel poverty” this Christmas, as the big freeze adds to the impact of imminent price rises from Big Six energy companies.
Research produced for The Times shows that by early next year, 5.5 million households, or 21 per cent of the 26 million total, will be in fuel poverty — spending more than 10 per cent of their monthly income on energy bills — the highest level in 15 years. The estimate from National Energy Action (NEA), which comes as fresh snow is expected to hit Wales, Scotland and northern England this weekend, represents an increase of 400,000, or 8 per cent, since October.
Last night, Greg Barker, the Energy Minister, told The Times that the existing system to deal with the problem was “completely broken” and admitted that he was “very worried” by the figures. “What is clear is that the rate of progress has not been nearly ambitious enough,” Mr Barker said. “We need a complete step change in energy efficiency in the UK.”
NEA’s previous estimate of 5.1 million “fuel-poor” households is set to surge next Friday when British Gas, the nation’s largest energy supplier, raises prices for 8 million customers by an average of 7 per cent. A further 3.6 million customers of Scottish & Southern Energy have already been hit by a 9.4 per cent increase, while Scottish Power also raised its prices with immediate effect last month.
But while Mr Barker sought to pin the blame on Labour for failing to tackle the problem during its time in office, campaigners blasted the coalition for failing to act and for cutting emergency funding. Michelle Mitchell, Age UK’s Charity Director, said that it was “unacceptable” that so many elderly people were currently struggling to stay warm. “As yet another round of price hikes comes into effect, many older people will be feeling extremely anxious about their heating bills and putting their health at risk in an attempt to keep costs down,” Ms Mitchell said.
Meanwhile, Jonathan Stearn, a campaigner at Consumer Focus, also attacked the Government for cutting funding for its Warm Front scheme by two thirds from £300 million this year to £110 million next year.
“They should be increasing funding for Warm Front, not cutting it back,” Mr Stearn said.
The Government was also criticised for delaying until April next year the introduction of its Warm Homes Discount, a scheme designed to knock £130 off the bills of the poor and elderly. It will arrive too late to help those struggling to meet bills this winter.
Ron Campbell, director of policy at NEA, said that 5.5 million would represent the highest number of people in fuel poverty since 1996. The figure is based on the assumption that five of the Big Six will have raised their prices by 8 per cent by Christmas.
The companies have blamed higher wholesale gas and electricity prices as well as the need to invest billions of pounds in renewable energy schemes and nuclear power stations.
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