People and businesses across North East express their concern as new energy price cap is announced
People and business across the North East have expressed their concern about the new price cap.
Ofgem announced on 26 August that the energy price cap will increase by more than 80% to £3,549 from 1 October.
The stark increase, from the current amount of £1,971, comes as Ofgem's chief executive urged the incoming prime minister to “act further” to tackle the impact of price rises.
The change will mean that householders on a typical default tariff will pay an extra £1,578 a year for their gas and electricity.
Video report by Kris Jepson.
Lillith Mallon is disabled and can't work, she said she is anxious about October's rise in energy costs.
Ms Mallon said: "In a house like this a little bit of damp is expected but the only advice you get is keep the windows open and keep the heating on, which is easier said than done when you're nervous about the costs.
"Like it already shoots the price up in the winter when you can't hang things out on the line and you've got to use a washer drier, which we don't have, so we're using the radiators, to the point where we just refuse to put the heating on if it's about our comfort, it's only to dry clothes.”
Her husband Jacob Mallon said he feels as though bills are already "piling" up and the new energy cap could have a significant effect on their bills.
Mr Mallon said: "We went from paying I think it was about 50 or 60 quid just for gas and electric and then that bumped up and I think we're paying about £180 now, so it's like more than doubled, you know, and now it's going up again and I'm thinking am I going to be sat here paying over 200 quid for my gas and electric?
"Just two utilities and then I've got council tax, water rates and food and it's just like piling on top and yeh, we're just really scared about it, you know."Some 4.5 million pre-payment meter customers - who are often the most vulnerable and already in fuel poverty - will see an even more punishing increase, with their average annual bill set to go up to £3,608.
This time last year, households were paying approximately £2,300 less for energy. Bill payers may have to wait to discover what further action might be taken, with the Tory leadership race result yet to be confirmed.
Charity Changing Lives published a report which found that 80% of its services have seen a rise in the number of people no longer able to make ends meet.
Lynn Crawford from Changing Lives said: "I truly believe that there are going to be deaths this winter because I think there's going to be hypothermia, there's going to be starvation, there's going to be suicide.
“I used to think oh this is bad, this is bad, and stuff like this, but I've never seen anything like this where, you know, people have had to make changes to the budgets and they've had to tweak things and stuff like that, but this could literally swallow up somebody's whole income and then how are they going to keep a roof over their head? If it's going on gas and electricity then they've got no money to pay their rent or their water or other bills. Ofgem and the government have got to do something about it.”
Newcastle single parent "Ben" is having sleepless nights about his current cost of living.
Ben - not his real name - has ongoing emotional support from Changing Lives case workers.
Ben said: “My biggest fear is not being able to feed my kids, clothe them, put the heating on for them, not pay my rent and keep a roof over our heads and for the local authorities to come and take my kids away, because I haven't been able to do all that.”
Businesses like this School of Chocolate in Newcastle say they are not protected by the price cap.
Zoe Rutter owner of School of Chocolate said: “My business is located across three sites so I'm paying three sets of energy bills and yeh, I am concerned because it's directly impacting the money we make, the money I can put into the business and the money I use to pay my staffs' wages.
“We've just come out of covid. That was a nightmare, it was a rollercoaster. A big challenge to small businesses and then to go into the cost of living crisis and these energy prices that just keep rising, with no support, it could, that is the reality.”
The government says it's already offering a £37 billion pound package to help people with the rising cost of living.
In a statement, Chancellor Nadhim Zahawi added: "Help is coming with £400 off energy bills for all, the second instalment of a £650 payment for vulnerable households, and £300 for all pensioners."
What help is available for households concerned about their current sky-high energy bills and their impending rise?
£400 energy bill discount:
Rishi Sunak, the former chancellor, announced a £15bn support package for consumers in May, including a £400 discount for every household on their energy bills.
The discount will be made in six payments from October.
But experts have warned that support does not go far enough, as it was announced in May when the price cap was not expect to soar as high.
How to get money back if you pay council tax:
Many households will be able to receive a rebate on council tax to help cover the cost of rising energy bills.
You will get a rebate if you pay council tax and your home is in council tax bands A to D – you will receive a £150 rebate.
People living in England can find out which council tax they are in by using the government’s online checker here or you can find your band by checking your council tax band.
You will only get the rebate if you’re the person who has to pay council tax for your household. Only one person per household will get the rebate.
Households will get the rebate even if you:
get a council tax reduction, including a full reduction, and your home is in bands A to D
get the disabled band reduction discount and your home is in bands A to E
are subject to immigration control and your biometric residence permit says “no recourse to public funds”
How to find out if you'll get a £150 council tax rebate amid rising energy bills
How to receive the rebate:
If you set up a direct debit to pay your council tax before the end of March 2022 your council should pay your rebate directly into your bank account, with a one-off payment of £150.
If you don’t pay by direct debit or didn’t set up a direct debit before the end of March 2022, you should still get a rebate – your local council will contact you and you will probably be asked to fill in an online form.
You should contact your council before 30 September 2022 to check how you can claim the rebate, if you haven’t heard from your council.
Winter Fuel Payment:
The Winter Fuel Payment is an annual one-off payment to help you pay for heating during the winter.
If eligible, you could receive between £250 and £600. You can usually get one if you were born on or before September 26, 1956.
Details are here on the government website.
Cold Weather Payment:
Cold Weather Payments are one-off payments to help you pay for extra heating costs when it’s very cold.
You’ll get a payment each time the temperature drops below a specific temperature for a set period of time.
You’ll get £25 for each 7 day period of very cold weather between 1 November and 31 March.
You’ll only be eligible for a Cold Weather Payment if you already get:
Pension Credit
Income Support
Income-based Jobseeker’s Allowance
Income-related Employment and Support Allowance
Universal Credit
There is no need to apply - if you're eligible, you will be paid automatically.
However the 2021 to 2022 Cold Weather Payment scheme has now ended, and next year’s scheme will start on 1 November 2022.
Warm Home Discount:
The Warm Home Discount is available to households on a low income or claiming pension credit.
If you’re eligible you could get a one-off discount of £140 off your bills between October and March.
The money is not paid to you but is taken off your bill.
You can still qualify for the discount if you use a pre-pay or pay-as-you-go electricity meter.
If, however, you live in a mobile home, you have to apply separately for the Park Homes Warm Home Discount scheme.
The Warm Home Discount Scheme for 2021 to 2022 has now closed, and the 2022 and 2023 scheme will open later in the year.
You must contact your supplier to confirm your eligibility and apply, though the number of discounts a supplier can give is limited.
How to get a grant from your energy supplier:
If you’re in debt to your energy supplier, you might be able to get a grant to help pay it off.
The following energy suppliers offer grants to their customers:
If none of these companies supply your energy, you can still apply for a grant though British Gas Energy Trust as you do not need to be a customer, but you need to get debt advice before applying.
Check if you can get a grant from the British Gas Energy Trust here.
Local Energy Grant:
Simple Energy Advice offers a tool on its website to locate grants available in your specific area.
Your local council may also provide various grants.
Grants from charities:
Let's Talk has information on grants some charities offer and how to apply. Turn2Us has grants search and adviser locator tools.
What can you do if you can’t afford to top up your prepayment meter?
You might be able to get a fuel voucher. This is a code given to you in a letter or in a text message or email.
You can use it to add credit to your gas card or electricity key. If you don't have one of these, contact your supplier to get one.
Your local council may be able to help you get a fuel voucher.
For more information on advice if you're struggling with your energy bills, contact Citizens Advice and you can get help from an adviser.
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