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Daily Mirror
Daily Mirror
Business
Sam Barker

Martin Lewis urges MPs to crack down on bills trick used by energy companies

Martin Lewis says hard-up Brits face a "fiscal punch in the face" from rising energy bills - and the government needs to do more to help.

Charities including Citizens Advice and Scope are also calling the chancellor Rishi Sunak to do more to help households weather the cost of soaring energy costs.

These bills are due to increase by £693 a year for the average household from April 1.

The current government help for soaring energy bills is a £150 council tax rebate for homes in bands A, B, C or D in England and Wales and a £200 rebate on energy - which homes would need to repay.

Speaking to MPs today, MoneySavingExpert founder Martin Lewis said government measures were not good enough.

"On April 1 people are going to feel a fiscal punch in the face," he told the Business, Energy and Industrial Strategy Committee today.

When asked what government should do to help more struggling Brits, Lewis said: "It needs to give them more money. It really is as simple as that.

The cost of the average variable rate energy bill, for the average household, is capped by regulator Ofgem.

That cap is rising from £1,277 a year to £1,971 on April 1, with further rises expected from October, in response to supply demands due to the war in Ukraine.

Lewis said there is no energy deal currently cheaper than the Ofgem price cap - expected to go up to £2,500 in October.

"We need to pump more money into the system, or have a vulnerable customer price cap, so they don't see these rises," he added.

Many people will see a twofold to threefold increase in energy bills in one year - an average £1,300 rise, Lewis said.

The £350 government help is simply not enough, Lewis added.

"Even if both were cash, that's £350 to cover a £1,300-a-year increase," he said. "That is clearly not enough. Some can clearly shoulder the burden. But there are many people who will not be able to afford a £1,300-a-year increase."

Almost two-thirds (57%) of people polled by MoneySavingExpert would opt out of the £200 energy bill grant if they could.

Gillian Cooper, head of energy policy at charity Citizens Advice, said current government measures to help homes afford energy bills are "insufficient".

Speaking to the committee, she said: "Without further support we are heading towards a crisis where a significant proportion of the population won't be able to keep up with the costs of warming their homes.

"We need the government to bring forward more financial support to help people with these increases."

Options to do this include raising benefits payments or turn the £200 energy bill loan into a grant, Cooper added.

Other charities are also calling for the government to do more to help Brits in need pay their energy bills.

Lewis added that energy companies are increasing customers' direct debits disproportionately to the price cap increase and the regulator should "crack down" on the widescale practice.

He told MPs about "worrying issues" over energy companies increasing customers' direct debits disproportionately to April's 54% increase to Ofgem's price cap, even for those in credit.

Tom Marsland, policy manager at disability equality charity Scope, said: “Amid the worst cost of living crisis in decades, disabled people and their families are being left high and dry by the government.

“The Chancellor must use the Spring Statement to stop disabled people and their families being pushed further into poverty."

Marsland said government should increase the rates of benefits to keep up with inflation and bring in financial support for the disabled families who need it most.

He also called on the Tories to scrap their plans to end £150 Warm Home Discount payments for 210,000 disabled people.

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