Source · Select Committees · Public Accounts Committee
Recommendation 5
5
Accepted
It is unacceptable that many vulnerable customers, on top of having to pay higher energy...
Recommendation
It is unacceptable that many vulnerable customers, on top of having to pay higher energy prices, face extra challenges working with energy suppliers and accessing benefits designed to help people with their energy bills. Vulnerable customers are most exposed to the rise in energy prices and some also face additional costs. Many vulnerable customers rely on prepayment meters, whose tariffs are typically more expensive than those paid by direct debit because the systems used to run them cost more which Ofgem reflects in the cost of energy. In addition, some vulnerable customers are not covered by the price protection available to other customers, or able to easily access the benefits available. For example, those who use district heating Regulation of energy suppliers 7 systems are not covered by the price cap. The Department is unable to explain how it will ensure that all customers who use prepayment meters or do not pay their bill directly, such as residents of park homes, will receive their £400 of energy support. Recommendation: The Department and Ofgem should urgently review the support that government has committed to providing to vulnerable households in relation to energy supplies and assess where administrative issues might prevent support being provided in a timely manner. It should, as part of the Treasury Minute response, update the Committee on their findings and how they are addressing them.
Government Response Summary
The government agrees and outlines existing schemes like the Energy Bills Support Scheme (EBSS) and the Energy Price Guarantee (EPG) to support vulnerable households. It also details efforts to ensure those with traditional prepayment meters receive vouchers, and alternative funding for those not eligible for EBSS.
Government Response
Accepted
HM Government
Accepted
The government agrees with the Committee’s recommendation. vulnerable customers benefit from the energy support available to them. Under the Energy Bills Support Scheme (EBSS), households have started to receive £400 off their energy bills since October 2022, with the discount made in six instalments. This is being delivered via energy suppliers. Ofgem provides the compliance and enforcement framework for EBSS and monitors energy suppliers’ compliance with this. Ofgem is acting swiftly to resolve any compliance concerns, in line with its duties under relevant supplier licence conditions, to ensure customers are receiving what they are entitled to. Suppliers have confirmed that vouchers have been sent to all two million customers with traditional prepayment meters (PPMs). The department is urging consumers to redeem vouchers via a communications campaign targeted specifically at traditional PPM users; this includes posters, social media posts and radio broadcasts to ethnic minority radio stations in different languages, as well as communications direct from suppliers to customers. The government continues to monitor voucher redemption rates through supplier reporting and will work with suppliers to ensure they are taking action to contact those with unredeemed vouchers and to reissue lost vouchers. The government is also working with the Post Office, PayPoint, consumer groups and charities to ensure that they carry and transmit accurate information about EBSS. Vulnerable customers who are not eligible for EBSS, due to not having a direct relationship with an electricity supplier, such as park home residents, may be eligible for the Alternative Funding announced in July 2022. The government is undertaking key work with a range of stakeholders to finalise the details regarding eligibility and process, to ensure payment this winter. In addition, households continue to be supported by the Energy Price Guarantee (EPG). This government scheme will bring a typical household’s energy bill in Great Britain down to the equivalent of around £2,500 per year (for the period of 6 months) from 1 October 2022 to the end of March 2023. The EPG will save a typical household in Great Britain £900 in the winter of 2022-23.