Citizens Advice response to BEIS consultation on the Energy Bills Support Scheme
In April, energy bills increased by an average of 54%, to over £2,000 annually. Evidence from across our service indicates that households are struggling to make ends meet. In March 2022, Citizens Advice advisors spoke to more than 9,500 people with fuel debts, the highest point since the start of the pandemic. In the same month we also referred more than 39,000 people for crisis support, the highest since records began.
In October, prices are likely to rise further still, and we welcome support being provided to energy consumers this winter. Since this consultation closed, the Government has announced significant changes to the scheme, removing the need to repay the energy support in coming years and increasing the size of the support from £200 to £400. This is alongside significant additional targeted support via the benefits system for households on lower incomes or who are likely to use more energy.
We welcome these changes which should mean families are more able to cope in what will remain an incredibly challenging time. We continue to have some concerns about the delivery of the energy support scheme, in particular:
Around 2 million households with traditional (non-smart) prepay meters will receive support in vouchers. These consumers tend to have low engagement with their supplier, so may discard communications, and there’s a risk that vouchers may be lost or stolen.
People who rent their homes where the landlord pays the energy bills won’t have guaranteed access to support. The Government should clarify guidance and put in place discretionary support for those who miss out.
People with energy debts will have the rebate applied to the amount they owe. These debts are on average much larger than the rebate, and they may not feel any day-to-day reduction in their energy costs.
Many of these issues could be avoided by delivering the support via a negative standing charge, applied daily across the period, rather than as a lump sum. We’ve called on the Government to explore the technical feasibility of this option, but it may be too late to deliver the scheme by October. Taken forward in its current form, industry and government must work closely together to proactively communicate to consumers - particularly those with traditional prepayment meters - and take additional steps to ensure support is provided to as many consumers as possible.