Bill payers are being warned against boycotting energy bills as the price cap is forecasted to rise to 81 per cent in October and a further 19 per cent in January.
Millions of households are expected to struggle to make ends meet as energy prices are set to rise again to a staggering £4,200 January according to the latest data. Meanwhile, campaign group Don't Pay UK are rallying support as they urge million to not pay their bills in protest.
Don't Pay UK are urging households to refuse to pay energy bills on October 1 in an attempt to force energy providers to reduce bills to reasonable price. The same tactic was used in the late 80s and 90s in protest to PM Margaret Thatcher's poll tax in which 17 million people boycotted the cost.
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This comes as Ofgem have confirmed they will change the way the price cap will be set. The energy price cap is now going to be changed every three months, rather than six to reflect the fluctuating prices and Ofgem argue it will avoid nasty surprises appearing on bills.
What happens if you don't pay your energy bills?
Finance experts are warning households against boycotting their energy bill payments. Those who choose to take part in the 'strike' could breach their contract and therefore the energy provider is in their legal right to take action.
The energy provider may also try to force you to take on a prepayment meter installed and in the most serious circumstances they can threaten to cut your supply if you haven't paid in 28 days.
But if you've reach State Pension age, energy suppliers can't disconnect energy between October 1 and March 31. They also can't disconnect power if you live alone, or only live with other people who have reached State Pension age, or children under 18-years.
Following that, your details could be passed on to a debt collection agency, according to charity StepChange, and there could be fees to cover the cost of this. On top of that there will likely be late fees added to your bills.
Finally, credit rating could be damaged if bills are not paid.
Tara Flynn, personal finance expert and co-founder of energy comparison site, Choosewisely.co.uk has urged of serious consequences.
Tara Flynn said: "I empathise with the campaign encouraging people to cancel their direct debits for their energy bills. I understand that for change to happen, sometimes you have to get radical, and I applaud the sentiment behind it when it feels like so little is being done to help. However, I'm gravely concerned about the long-term consequences of not paying energy bills for individuals.
"If you don't pay your bills for months on end and ignore all requests from your energy provider for payment, your provider could issue you with a CCJ (County Court Judgment), which will be kept on record and appear on your credit report. Unless you pay what you owe within 30 days of receiving a CCJ, it will stay on your credit report for six years, meaning it will be challenging to apply for credit during that time, making it much harder to get a mortgage, loan, credit card or even a mobile phone contract.
"For many, borrowing might be the only way to stay afloat during a potential recession, meaning The Don't Pay UK campaign could make things even harder for the very people it's trying to help."
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