Friday, August 26, 2022
Desperate times call for decisive government intervention
Well, they did it. Ofgem have today, increased the energy price cap by 80% to to £3,549 from October, that is the equivalent to a £300 a month plus the standing charge, completely unaffordable for most families. And where is the government in all this? They are absent without leave.
The Guardian reports that the cap will be almost treble what it was a year earlier last October, when it was raised to £1,277:
The announcement comes as households attempt to budget for a tough winter. Soaring energy bills have fuelled rampant inflation, which breached 10% last month and is forecast by some economists to climb to 18% from January.
Ofgem said it will not give projections for the next price cap change in January because the market remains “too volatile” but warned that prices “could get significantly worse through 2023”. The new cap will affect 24 million households – about 85% of the population.
That number includes about 4.5 million prepayment meter customers, who will pay on average an additional £59 a year.
They add that the next cap will be introduced in January, when it is feared that bills could reach as high as £5,000.
The Guardian reports that the cap will be almost treble what it was a year earlier last October, when it was raised to £1,277:
The announcement comes as households attempt to budget for a tough winter. Soaring energy bills have fuelled rampant inflation, which breached 10% last month and is forecast by some economists to climb to 18% from January.
Ofgem said it will not give projections for the next price cap change in January because the market remains “too volatile” but warned that prices “could get significantly worse through 2023”. The new cap will affect 24 million households – about 85% of the population.
That number includes about 4.5 million prepayment meter customers, who will pay on average an additional £59 a year.
They add that the next cap will be introduced in January, when it is feared that bills could reach as high as £5,000.
It is important that the government takes immediate action to mitigate these increases including abolishing the standing charge, removing VAT on energy, increasing taxes on the profits of the oil and gas companies and using the proceeds to reduce the cap once more, as well as targeting financial support at those most in need.
