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Record hike in energy prices threatens huge rise in fuel poverty, campaigners warn

A RECORD increase in energy bills for 15 million households this autumn threatens to plunge huge numbers into fuel poverty, campaigners and unions warned today.

As reported in the Morning Star earlier this week, watchdog Ofgem announced annual increases of up to £153 in annual bills — the biggest jump since the cap was introduced — charities pleaded with ministers to rethink their decision to end the £20 universal benefit boost.

The latest rise, on top of a £96 hike in April, will see those on default tariffs paying £139 more, up to an average of £1,277 a year.

And prepayment customers, among them some of the poorest and most vulnerable, will be hit even harder, with a £153 increase taking average bills to £1,309.

“This is a devastating increase,” said Peter Smith, director of policy and advocacy at the National Energy Action charity, which estimates that more than four million UK households are already in fuel poverty.

“This toxic combination of higher prices, reduced incomes and leaky, inefficient housing, will lead to a further surge in utility debt and badly damage physical and mental health this winter.”

He warned that the rise would come into effect on October 1, as the furlough scheme ends.

James Plunkett, executive director of advice and advocacy at Citizens’ Advice, said: “This price hike could lead to a perfect storm for families this autumn, hitting people at the same time as a universal credit cut and the end of furlough.

“It all adds to the growing case to rethink the government’s planned cut to universal credit and keep this lifeline which has been vital to keeping so many afloat.”

Energy union GMB slammed the government for piling pressure on the poorest households while increasing dependence on energy imports.

General secretary Gary Smith said: “That’s a recipe for failure, not just for jobs and consumers, but also for the UK’s security of supply and our net-zero ambitions.”

Scottish Labour energy spokeswoman Monica Lennon said: “Fuel poverty remains a real threat to thousands of Scots and the risk is that this price hike will force more people into it.  

“Privatisation of energy has been a failure: that’s why Scottish Labour has called for the creation of a national energy company to deliver for the needs of the people of Scotland.”

Ofgem said the increase had been driven by a rise of more than 50 per cent in energy costs over the last six months.

The Fuel Poverty Action campaign argued that cheaper deals would not exist if everyone shopped around, adding that “change needs to go beyond redistributing poverty.”

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