Financial experts answer 5 Live listener's questions
The typical household energy bill will hit £3,549 a year from 1 October, regulator Ofgem has announced.
The cap is currently £1,971 for the average household and limits how much providers can charge customers in England, Scotland and Wales.
Experts on Radio 5 Live have been answering questions from people around the country about their financial situations.
‘I’m too young to access my pension’
Gillian in Peterborough phoned Radio 5 Live to say she's had to retire early because of a disability and feels "trapped" by her age as she's too young to access her pension.
Personal finance expert Martin Lewis says people in Gillian's situation should go to citizens advice to check they're not "missing out" on any help they're entitled to.
After that he suggests people contact the fuel poverty charity National Energy Action then see if they can access a grant from their energy company.
He also advises people who are disabled to check if there's a charity for their condition and speak to them as well.
Speaking about the plight of disabled people, Martin says he has been advocating for specific help for disabled people in any packages given out by the government.
"It's unthinkable that there won't be more help," he says, "often [disabled people] are at home more so their energy use is higher."
"There are some people who have specific electricity requirements because of ventilators and things like that, and there may be government help for that."
"I said months ago, it was my call to arms to the government to do something, after all these years of being the Money Saving Expert, for those on the lowest incomes, for those who are most vulnerable, with energy bills I was out of tools, and I'm afraid I feel like that again."
‘I’m at my wits end’
Lillian lives in Lincoln and is in her 90s, she says she’s at her “wits end” with the cost of living as she has already taken cost cutting measures such as avoiding using lights as much as possible and restricting her use of the television.
“I’ve never claimed one penny for anything throughout my life,” she says, “I’ve come to this and it’s absolutely horrendous.”
Morgan Wilde, policy manager at Citizens Advice, says people like Lillian will be getting some help with their energy bills as the winter fuel payments have been boosted to £500 or £600, depending on people’s age.
“There’s not going to be enough for people to weather this crisis,” he says.
He explains when that package of support was announced, it was assumed bills would rise to £2800 in October.
“Bills are now £3,549… eye-watering, unprecedented sums and the scale of government support has to match the kind of financial response we saw in the pandemic,” he says.
'Increase in my bills is stressing me out'
Pradeep called Radio 5 Live who said he is feeling “stressed out” by the increase in his energy bills.
Watch Martin Lewis' answer to Pradeep's concerns below.
Martin Lewis on energy price cap: ‘Lack of help is frankly irresponsible’
Personal finance expert Martin Lewis responds to the energy price cap rise.
‘It’s survival of the fittest’
Luke runs a swimming pool in Southampton and says his energy bills have gone up from £30k a year to £150k a year.
“I’m not seeing any support from the government,” he says, “it’s survival of the fittest… they’re going to lose the backbone of this country, which is small businesses.”
Speaking about his energy suppliers, Luke says they reported a large profit last year and asks why those profits aren’t being used to help their customers.
BBC personal finance correspondent Kevin Peachey says energy supply is “not a profitable business” currently, which is why a lot of smaller energy suppliers have gone bust.
“But energy production is hugely profitable,” he says, “which is why there’s a focus on a windfall tax for those companies.”
‘We’ll be in fuel poverty’
Aiden works as a teacher in Cheshire and lives with his fiancée who is a senior nurse, he says if energy bills reach the predicted £4600 in January the couple will be in fuel poverty as their energy bills will be more than 10% of their income.
Laura Pomfrett is co-founder of the personal finance app Financielle, she says if people like Aiden are having to cut back on their spending, that will have a big impact on local businesses.
She says there is help available for people in Aiden’s situation for managing their budgets and helping people understand where they can make room, but that help will “only go so far”.
“There’s lots of vulnerable people who you wouldn’t traditionally class as vulnerable,” she says, “they will need a lot more help and awareness.”
“We’re finding people are burying their heads because they’re so intimidated by these jumps… people are waiting for the first bill and will tackle it then – and that’s a worry.”
