‘It will push me over the edge’: the End Fuel Poverty Coalition warns a further 1.2 million people could be pushed into poverty by Friday’s energy price cap hike. Photo: End Fuel Poverty Coalition
England’s worst impacted areas for fuel poverty have been revealed on the day of Ofgem’s unprecedented price cap hike.
Energy regulator Ofgem has raised the energy price cap by £139 — to £1,277 from £1,138 — in a move anti-poverty organisations warn will further entrench “endemic” fuel poverty.
The End Fuel Poverty Coalition has published a map revealing England’s worst affected areas, with people hardest hit living in local authority jurisdictions Barking and Dagenham, Stoke-on-Trent and Newham.
Ofgem’s rise is set to propel a further 1.2 million people into fuel poverty, to 5.3 million from 4.1 million, according to analysis by the End Fuel Poverty Coalition. That means 22 percent of all English households.
The energy cap rise comes off the back of a string of government withdrawals in coronavirus support measures — with both the job retention scheme and universal credit top-up axed this week — and an upcoming national insurance tax rise that will disproportionately impact low-income families. Against this backdrop charities have attacked the energy price hike as another shackle locking poor families in poverty.
“The energy price hike is part of a giant combination lock that will keep people in poverty,” Simon Francis, coordinator of the End Fuel Poverty Coalition, told The Big Issue. “People across the country will be looking on in despair wondering where the next blow will come from.”
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He added: “We face the real possibility of fuel poverty becoming endemic in our society.”
Ofgem — the Office of Gas and Electricity Markets, a government regulator — reviews and tweaks the price cap every six months. The £139 rise is the largest fuel bill jump ever.
“This toxic cocktail of challenges will leave millions of households struggling to cope with less income and higher costs,” said Peter Smith, director of policy and advocacy at National Energy Action, a fuel poverty charity. “For many it will be an impossible task.”
David Price, a 42-year-old forklift driver from Stoke, lives in the local authority jurisdiction with England’s second worst rates, with 22 percent of Stoke-on-Trent households suffering fuel poverty.
Price has already been receiving emergency fuel vouchers to help pay his energy bills amid escalating costs. “It has really helped, but the price rise now means that something else will have to give — as I won’t be able to afford to pay,” Price told The Big Issue.
“I sold my car last year and now use public transport and now I will have to cut my food bill to be able to make extra savings somewhere,” Price said. “It’s also happening at a rubbish time of year.”
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Price is just one of millions of people — not just in England’s worst hit areas — facing uncertainty over how they will weather a winter of escalating living costs.
Sandra Hayes, a 47-year-old cleaner who was made redundant during the pandemic, lives in Guildford, a local authority area with lower but still stubborn rates of fuel poverty.
Hayes is among Guildford’s 7 per cent of households trapped in fuel poverty — and is fighting to give her young son the best start possible against the odds.
“The price increase will be worrying for me because I had to have help before with my bills,” Hayes told The Big Issue. “I am in a low paid profession and I don’t have much money.”
Price and Hayes have both been supported by Auriga Services, which helps people in financial difficulty, for instance helping Price apply for the Big Difference Scheme.
Hayes went on: “It’s not fair that we will have to pay more, I am worried for my future and that of my little boy — I think it will tip me over the edge again.”
The fuel poverty map revealed that Barking and Dagenham suffered England’s worst rates of fuel poverty, at 23 per cent of households, and Bracknell Forest suffered the least, with 5 percent of households.
The End Fuel Poverty Coalition compared each local authority district’s fuel poverty rate to the level of support provided through Eco Flex measures and Low-Income Green Homes Grant Vouchers.
“This map reveals stark inequalities in rates of fuel poverty across England,” said Caroline Abrahams, charity director at Age UK, with the worst impacted areas clustering in the north of England as well as the Midlands and London.
“The problem is that too many older people” — many of whom are on low fixed incomes — “are living in energy inefficient cold homes, guaranteeing that they will be facing sky high bills,” Abrahams added.
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Meanwhile nine UK energy firms have gone bust in recent weeks amid a surge in global wholesale gas prices, with 1.7 million UK households so far impacted, as price promises to customers became undeliverable.
Fuel poverty — like furniture, food or period poverty — is not a unique type of poverty but a consequence of not having enough money. Charities are raising the alarm Friday’s price cap hike will force families to choose between food or fuel.
“Keeping healthily warm is a basic human right and it’s wrong that so many people are struggling with cold homes when living in a developed country like the UK,” said Ian Preston, head of household energy at charity the Centre for Sustainable Energy. “Cold homes cause misery, ill-health and social exclusion.”
A spokesperson for the Department for Business, Energy and Industrial Strategy said: “The energy price cap is shielding millions of customers from rising global gas prices. Even with today’s planned increase, the cap still saves households up to £100 a year and is in addition to wider support for vulnerable, elderly and low-income households.”
They added the government this week announced a new £500 million Household Support Fund for supporting those in need, and said “families will continue to benefit from Winter Fuel Payments, Cold Weather Payments and the Warm Home Discount, which is being increased to £150 and extended to cover an extra 750,000 households.”
But anti-poverty organisations are calling on the government to act now, stop the £1,040-a-year cut to UC and invest in making UK homes more energy efficient.
“We need immediate support for those on lowest incomes,” said Smith of National Energy Action, such as helping to clear household energy debt, protection from future price rises and investing to make homes more energy efficient.
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