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Debt charities urge Ofgem to protect people with energy debt

09 August 2022

The UK’s three largest debt charities have urged the energy regulator Ofgem to urgently improve protections for people in arrears after publishing a briefing highlighting the scale of the challenges many face.

Citizens Advice, the Money Advice Trust and StepChange Debt Charity are warning that with a further substantial rise in the energy price cap coming in October, more households will be unable to afford their energy bills. They warn that the risk of disconnections is compounded by people “self-rationing” their energy use – putting at risk their physical and mental health.

The charities’ findings show that:

  • Energy arrears, rather than Council Tax, are now the most common debt type amongst people approaching them
  • The number of people seeking energy debt advice from Citizens Advice in the first three months of 2022 was 64 percent higher than the same period in 2019
  • The average level of energy arrears amongst callers to StepChange Debt Charity has risen by almost a third (32 percent) in the past two years – from  £1,056 in 2019 to £1,399 in 2021.

The charities have written to Ofgem urging them to produce guidance to energy companies that ensures people in arrears are treated fairly and are not asked to repay amounts they cannot afford and to protect them from aggressive debt recovery agencies.

Joanna Elson CBE, Chief Executive of the Money Advice Trust, the charity that runs National Debtline and Business Debtline, said: “As the Business, Energy and Industrial Strategy Committee rightly highlighted, Ofgem can, and should, do more to offer protection to households struggling with their energy bills. We are calling on the regulator to ramp up protections to ensure energy firms treat people struggling to pay or already in energy arrears fairly, including halting potentially harmful debt collection practices.”

Fazilet Hadi, Head of Policy at Disability Rights UK said “The Disability Poverty Campaign Group met with Ofgem in late July and raised a number of issues on which it needed to take action including improving protection to customers in vulnerable situations, stopping people using pre-payment meters from being disconnected and ensuring accessible information and communication with Disabled customers. They also urged on-going engagement between Ofgem and DPOs.”