Recent cold weather in the UK has brought the plight of the elderly into sharp focus. Those on a small pension cannot afford to pay their heating bills and many are making sacrifices just to keep themselves warm.
Apparently pensioners are paying about £1100 a year, on average, on their fuel bills and are struggling to keep warm as they turn their heating down to minimal levels. Unfortunately some cut back too deeply and die from hyperthermia.
In a recent survey, Uswitch, the utilities comparison company, found that one in five pensioners live in fuel poverty, which is the point at which fuel costs cut into an unacceptably large percentage of income. The government targets to eliminate fuel poverty by 2010 will be missed by a considerable margin.
Yet the wholesale gas prices have been falling for several months and are now at least 25% lower than their peak in 2006.
It’s understandable that prices charged to consumers will lag behind changes in wholesale prices, however British Gas has only just announced a reduction in its charges. Whilst this is welcome, and will reduce gas bills by 17%, one must feel slightly cynical about the timing of the price reductions, which take effect from 12th March 2007.
Presumably this timing ensures current high prices are maintained during any cold spells in February and early March and that the cheaper prices take effect when the warmer temperatures of spring arrive.
It would be good to be proved wrong with this assumption, and British Gas must be congratulated for leading the way with price reductions, but why can’t they implement these reductions sooner?
There is the health and well being of elderly people at stake here.
British Gas already supports the Help the Aged charity, but surely it can take that support one step further and bring forward the price reductions. As a market leader, it will force the other energy companies to follow its example.
Anne Morton of Centrica points out that British Gas has announced a new “social tarrif” which will lower bills even further for 750,000 vulnerable customers, giving them an annual saving of £285. This additional saving will also take effect from 12 March 2007.
Switch and Save – but Wait and See may be better
Switching your energy supplier is very easy to do – don’t let anyone make it sound complicated or difficult. However it may not be the best thing to do right at this point in time.
Energy companies will compete with the lower British Gas prices. They have to. Their prices will be more competitive, but unfortunately no announcements have been made yet. It seems sensible to sit back for a few weeks and see which is the best deal for you. Then do not hesitate to switch to the best provider.