Pensioners were dealt good news this week because the ‘Big Six’ energy suppliers have agreed under a new government initiative to cut £20million from pensioner electricity bills.
It will affect around 250,000 pensioner households, where at least one person is over 70 and in receipt of a pension credit. Each is set to receive an £80 rebate, and payments will start from as early as this May or June.
For most, payments will be made automatically by their energy suppliers, who will deduct the rebate directly from their electricity bills. The government has vowed to help ensure payments reach these vulnerable households as quickly as possible.
The Department for Work & Pensions said it would do this by sharing, ‘…data with British Gas, EDF, E.ON, nPower, Scottish Power and Scottish & Southern Energy about who these householders are so the companies can automatically issue the rebate, which will be funded by the energy company.’
Even though the rebate is for electricity only, and most people heat their homes with gas, it has been designed to help vulnerable households with their heating bills. Pensions Secretary Yvette Cooper, who announced the initiative, said ‘I don’t want any vulnerable pensioners to be afraid to turn up their heating.’
She added, ‘This deal will now deliver extra help of £80 to some of the poorest of pensioners over 70 and give them the reassurance they need as we come out of the coldest winter in decades.’
The eligibility criteria are not entirely clear yet; for instance, if a household is already on an energy supplier’s social tariff, then they may not qualify. However, it is due to be finalized at the end of this month.
The good news is the rebate will be awarded in addition to the £250 cold weather payments already given to at risk households. Consumer groups have welcomed it, but have called for it to be fine tuned in order to provide financial assistance to all vulnerable households, not just pensioners.
Jonathan Stearn from Consumer Focus said, ‘Better targeting of assistance to low income households is the way forward in assisting the poorest customers who are struggling to meet their energy bills.’ He added, ‘This is a very welcome move and needs to be developed to help all low income consumers struggling to make ends meet.’
Many vulnerable households fail to receive the energy discounts they are entitled to because their details are incorrect on their bills. The sharing of data between energy suppliers and the Department of Work & Pensions should help get the right support to the right people.
Garry Felgate from The Energy Retail Association, who represent energy supplier said, ‘Suppliers work very hard to identify those customers most in need of the help that’s available from their energy company and the information being provided by DWP should make this process easier and more efficient.’
Sources:
http://www.guardian.co.uk/money/2010/mar/12/energy-bill-rebate-pensioners
http://www.energychoices.co.uk/partner-ns~guk-energychoices.co.uk/pensioners-to-get-gbp80-energy-rebates120310.html
