Hunt resists call for 20% cut in energy bills
Chancellor Jeremy Hunt is resisting fresh calls to cut energy bills in the hope that falling wholesale prices will ease pressure on households and businesses.
Energy bills for a typical household will be allowed to rise from £2,500 to £3,000 a year from April and a £400 discount will also end.
The SNP says the UK government should cut energy bills by 20% and extend the discount while prices remain relatively high.
SNP Westminster leader Stephen Flynn said: “Tory plans to increase people’s energy bills, yet again, from April are abhorrent and must be stopped.
“Many households are already paying three times what they paid a year ago, while energy companies make record profits and the Tories refuse to act.”
Consumer finance commentator Martin Lewis said that allowing bills to increase would see another 1.7 million people enter fuel poverty – defined as 10% of income spent on energy – taking the total to 8.4 million.
But the wholesale price of gas has already fallen by 59% since October and a relatively warm winter and energy saving by households, may mean some bills may not rise that much, or at all, because bill payers have built up credit on their accounts.
It is also likely that falling wholesale prices will allow energy providers to cut the price charged to consumers to below £3,000.
Mr Hunt, who will present his Budget on 15 March, said all support is “under review” but he did not think the government had the “headroom to make a major new initiative to help people”.
The latest calls come ahead of figures from British / Scottish Gas parent Centrica which is expected to post record annual profits of around £3 billion this week.
Its statement follows outrage over debt collectors breaking into the homes of struggling customers to install pre-payment meters by force.
Chief executive Chris O’Shea is likely to apologise again for this behavior when he presents the results on Thursday. He has already publicly apologised.
Mr O’Shea is likely to come under pressure to scale back a salary and bonus bonanza of up to £4.26 million, linked to Centrica’s performance.
Last year he forfeited a bonus of more than £1 million for 2021 because of the “hardships faced by our customers”.
UPDATE 13 FEB: More gas and electricity suppliers could go bust because soaring numbers of households are unable to pay their bills, says an industry body says.
Energy UK urged the government to scrap April’s 20% rise in energy bills, saying that otherwise “millions more households will fall into debt”, with “disastrous” consequences for consumers and companies.