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Liverpool Echo
Liverpool Echo
National
Elliott Ryder

Couple forced to sell wedding rings to pay for bills

In Jonathon Mahon’s one bedroom flat, the heating is only used for a few hours a day.

The 55-year-old explains it gets turned on for two hours in the morning and two hours at night.

His wife, who suffers with a number of debilitating conditions, spends the rest of the day wrapped in blankets and clutching a hot water bottle.

READ MORE: Thousands could be entitled to extra Universal Credit payments

He told the ECHO: “It would be nice to have it warm all of the time, but we can't.”

He says electricity “swallows everything” in order to run two medical machines.

Mr Mahon was previously self employed, but he has been caring for his wife for the last six years.

Both are unable to work - meaning they are reliant on ESA (employment and support allowance) payments.

He claims his energy bills and his household’s outgoings - rent, council tax, water - total more than is currently provided by the ESA payments.

Mr Mahon says that it is the generosity of family members and the local community that ensures they can meet the cost of living each month.

They use a local food bank in Sefton which enables them to have enough provisions for the week.

The energy price cap rise, set to be introduced in April, could see his energy bills rise by a further 50% while inflation continues to climb to the region of 5%.

"We're going to be obliterated" - Jonathan Mahon is worried about the increased pressure of higher energy prices (Andrew Teebay Liverpool Echo)

Mr Mahon told the ECHO: “We've never been this financially dead in the water before.

“This is the first time I've ever been on benefits in my life.

“In a way, it can't get any worse, where you're already spending 100% of your weekly income on utilities.

“[But the energy price cap is] another wave of the tsunami. We're going to be obliterated.

“It feels like we're in a canoe without a paddle and someone is now going to put holes in that canoe.

“It's impossible. I'm not waving, I'm not drowning, I'm not sure what I'm doing at the moment.”

'You don't go trudging up to a foodbank for the fun of it'

Research by the Joseph Rowntree Foundation finds households on low incomes will be spending on average 18% of their income, after housing costs, on energy bills after April.

For single adult households on low incomes this rises to 54%.

Mr Mahon is one of millions who will be affected when changes are made to the energy price cap.

The cap sets the maximum tariff energy companies can charge customers and is expected to climb due to increasing wholesale gas prices.

Currently, according to Liverpool Community Advice, the cap is set at £1,277 for credit meters and £1,309 for pre-payment meters and is expected to rise to the region of £1,800 in April.

It is expected that the cap will rise again in October to roughly 50% more than the current rates.

This could mean that energy bills will be £700 more expensive and hit an eye watering £2,000 a year, according to research by the Resolution Foundation.

Liverpool City Council suggests that 17% of people in the city already live in fuel poverty and stand to be put under further pressure by the rising costs of living.

But even before the rising costs, many were already battling precarious situations.

The £20 Universal Credit uplift recently ended in November and other benefits such as PIP are not set to rise to meet escalating costs.

Middle to lower income families will also feel the strains with wages not rising.

Mr Mahon told the ECHO: “Last year, we had to sell our wedding rings. We were at a stage where we had to look at what we could sell so we could do something.

“The government will say it's down to a lack of budgeting and that people are being feckless.

“I'm not being feckless. The people I know in this position are not being feckless.

“You don't go trudging up to a foodbank for the fun of it. It's soul destroying.”

Energy prices are set to rise in April and again in October and could go up by as much as 50% (PA Photo/thinkstockphotos)

There are similar examples of how people across the city region will be impacted.

Martin Landregan lives in the Anfield area and outlines how he was "scared" when he first heard the news of energy prices rising.

He says his fuel bills are already a huge burden on his income and the prospect of paying more will stretch him and his family further.

He told the ECHO: "They are expecting extra money from nowhere. It can make you feel desperate. And food bills are are also going up."

Mr Landregan adds that he and others will have to be careful with how he uses energy, prioritising things such as using the washing machine to clean school uniforms. He questions how it is "legal" to put enhanced pressures on lower income families and that a more "longer terms solution" is required to help people out.

Jenny, who didn't want to give her second name, lives in Everton and told the ECHO how further energy price rises means she will likely need to get a second job to cover the costs.

She says she already pays over a large amount of her household's income to heat a three bedroom home and that taking on an extra job will mean she's unable to spend more time with her children, meaning they miss out on some activities.

She added: "Lots of people are going to have to cut back and compromise. It's going to kill some people."

'People are going to die'

Alan Kelly, development officer at Vauxhall Community Law Centre, has worked in benefits advice for the last 35 years and he can’t recall a situation where the outlook for the future has been so bleak.

He told the ECHO: “It’s a bit dire at the moment. It’s a lethal storm."

He added: “I don't think people are getting closer to the cliff edge, I think they're going over it.

“When the bills start landing in the next few weeks we'll expect there to be a lot more people needing support.

“The situation that we're in now, a lot of people that are desperate for help cannot get it.

“People are going to have to sacrifice something. Food will be the number one priority. Families in particular. Apart from the lights, people are going to be sacrificing heating.

“It's always happened, but it's the scale this time around. It's going to have such a huge impact because of other changes that have taken place and how the benefit system is being cut back.”

“I don't think people are getting closer to the cliff edge, I think they're going over it" - Alan Kelly of Vauxhall Community Law Centre (Liverpool ECHO)

Helen Fisher is the energy and efficiency champion at Liverpool Community Advice Centre.

She believes that come April, more people will be having to decide between paying for their energy and utilities or putting the money towards a mortgage and council tax.

Ms Fisher told the ECHO: “Benefits aren’t going up by anything significant. People are not going to get a pay rise in April. They’re not going to be able to afford [the rising costs].

“It’s going to have catastrophic consequences.”

Ms Fisher explains how people can apply for a warm homes discount, totalling £140 a year.

However this is only eligible for certain low income households with certain criteria, something that won’t provide a wide ranging safety net as more “low income families are going to be sucked in” and “middle income families will be affected too”, explains Ms Fisher.

She added: “There are times I don’t know what to say to people. There’s not a lot we can do.

“We’re giving out food vouchers as people can’t afford to feed their kids. Or we’re giving out a charitable grant so people can buy a washing machine.

“People are in abject poverty at the moment.

“It’s a perfect storm. Unless the government steps in then people are going to die.”

The desperate situation is reflected at the Vauxhall Community Law Centre, where more people are coming for help but finding there are fewer avenues to explore to provide support for living costs.

The centre’s director and welfare and benefits solicitor Ngaryan Li outlines the difficulties of telling people, as benefits advisers, “this is all you can get.”

“People are in abject poverty at the moment" (PA)

She told the ECHO: “I recently had a case of two people who were working, but the wife has been diagnosed with cancer and going through chemo. He's been told by his employer, as a care worker, that if he doesn't return to work he’ll be put on compassionate leave. That's a full family income gone.

“They've got a mortgage and now critical illness, struggling with council tax and struggling with mobile phone bills which once they could have easily afforded.

"But because of the news of energy prices rising, they are going to be in the poverty gap as well.

"Rising costs, the housing crisis, the rising number of homeless, mental health cuts, all of that is a perfect storm.

"You still have the effects of Covid. People have been furloughed and accrued debts through all of that.

“As the centre director, it's so difficult to think ‘where do we put our resources?’"

The centres’ debt and benefits adviser, William Armstrong, believes the rising cost of living and energy price rises could undo much of the work the law centre has already done.

He told the ECHO: "Currently we're dealing with people with fuel debts as a whole tranche of other debts which have built up over the years. We're stabilising these people and helping them manage.

“Any sort of additional fuel price rises later on in the year is going to overturn all of the work we've been doing to stabilise people in their current situations.

"This will have a rolling effect on this as it unfolds throughout the year. Once people start feeling the impact of it they will start coming forward and looking for help."

Mr Armstrong adds that there seems to be no “overall plan” to reduce consumer consumption other than the worry of “eye watering fuel bills”.

He adds that fuel bills will often be treated as a priority debt so people aren’t cut off, but this means having to form a queue to manage other debts, such as payday loans.

'It's pushing more people into poverty'

At a local level, the combined authority has just revealed £45m investment for green housing in the city region.

This will go towards energy efficiency measures being fitted to the properties of 3,929 low-income households - in turn improving insulation and lowering energy costs.

Support in Liverpool is being offered through a ‘green homes grant’ which can be put toward energy saving measures being installed in homes.

This is applicable for households on a combined income lower than £30,000 and have an Energy Performance Certificate (EPC) rating of E, F, or G.

However the funding is limited and will be provided on a first come first served basis.

Cabinet Member for Neighbourhoods, Cllr Abdul Qadir, is urging anyone who meets the criteria to come forward.

However in the view of Ngaryan Li, despite the city council's best efforts among huge financial pressures of its own, these improvements can only “scratch the surface of on a tiny proportion of what's needed across the city.”

Ms Li added: “I think the Government needs to do something to recognise that the current benefit rates aren't fit. It's pushing more people into poverty. A benefit cap shouldn't happen. People are in hardship as it is.

“It really needs to reflect the costs now and what people can afford."

When asked about the Government’s response to increased financial pressures as a result of the changes to the price cap, a Government spokesperson said: “We recognise people are facing pressures with the cost of living, which is why we are taking action worth more than £4.2bn and supporting vulnerable households through initiatives such as the £500m Household Support Fund and Warm Home Discount.

“The Energy Price Cap is currently insulating millions of consumers from high global gas prices. We’ll continue to listen to consumers and businesses on how to manage the costs of energy.”

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