Another gas bill ‘hammer’ for families

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Amelis faced a new cost of living bill on Thursday after Afgem said it would update the energy price cap every three months.

The regulator confirmed that the maximum tariffs companies can charge for gas and electricity will be updated quarterly instead of every six months, meaning a huge price increase not just in October but on January 1. It will happen even in the depths of winter.

Jonathan Brierley, chief executive of Ofgem, today warned households that they will face a “very difficult winter” with analysts predicting an average rise to £3,359 a year from October and then again to £3,616 in the new year. is predicted.

Ofgem said the change would “go some way to providing much-needed stability in the energy market”, adding: “It is in nobody’s interest to see more suppliers fail and exit the market.”

But campaigners warned that households would see a huge strain on budgets, forcing the vulnerable to turn down the heat in winter. Caroline Abrahams, charity director at Age UK, said: “Ofgem’s decision to move to quarterly price cap changes is a hammer blow to millions of customers who are already struggling to pay skyrocketing bills. are

“With household energy prices forecast to hit massive shock levels from October, the decision to go ahead with another price range change in January is a huge blow to the health of vulnerable older households across the UK. There is danger.

“We are very concerned that the January price rise will hit consumers with bill increases during the coldest time of the year, no doubt with many people turning their heating off or off completely. can endanger health.”

Wholesale gas prices rose by nearly a third in the last week of July to the highest average price since mid-March.

National Grid saw the average price of gas rise by 31 per cent to 9.8p per kilowatt hour in the week to July 31, ONS figures show.

National Energy Action Director of Policy and Advocacy Peter Smith said: “It was not necessary for households to go ahead with price cap changes quarterly rather than every six months and unfortunately a further significant price rise in January is inevitable.

“Average annual bills are already predicted to rise by £1,200 a year – a 177% increase since last October.

“Now, households can expect further increases just after Christmas, in the middle of the summer season when energy prices are usually at their highest.

“January is usually a time of increase in mental health issues and further increases in bills will sadly lead to increased anxiety and depression.” Later in the day the Bank of England was expected to raise interest rates by 0.5%, adding to the pain for mortgage payers.

Mel Stride, the Tory chair of the Commons Treasury Committee, said: “As inflation rises further, interest rates have to rise and that has real consequences for people up and down the country. Every percentage point rise in interest rates That means around £580 a month more on the average mortgage payment, so it’s something that’s going to hit people really hard.

Food and fuel costs are also expected to continue to rise, with warnings from the National Institute of Economic and Social Research today that the retail price index, which is used to pay for rail fares and student loans, will drop later. will reach 17.7 percent. year.

Lib Dem Cabinet Office spokeswoman Christine Jardine MP said today marked “Black Thursday for millions of Britons” due to the pressure on precious lives and the growing risk of recession for the UK economy.

Paul Twohey, from the Campaign for Better Transport, called for a freeze on train fares in the New Year.

He said: “We need people to use trains to help reduce congestion and air pollution and boost economic activity in our towns and cities, but fares on cards are expected to double into next year. With the increase in, we have a real risk of pricing people off the rails.

“Government has helped drivers in cost-of-life crisis, now it’s time to help rail passengers with fare freeze for 2023.”