Description
The move will save millions of households £45 a year on their energy bills, the Treasury said. Prepaid meter customers will no longer be charged to receive their energy as part of the reforms to be announced in the Chancellor's Budget. Jeremy Hunt will end the 'prepaid premium' starting in July, saving more than four million households a year on their energy bills, according to the Treasury.
Households using pay-as-you-go meters, which tend to be low-income, currently pay more on average than direct debit customers, as the companies that operate the meters pass the costs on to users.
Hunt said: 'It is clearly unfair that those who use prepaid meters pay more than others. Let's put an end to this.
“Starting in July, four million households will only pay those who are domiciled. We've already cut our energy bill by almost half this winter, and this latest renovation proves once again that we're always on the side of families.
The Treasury estimates the change will cost the taxpayer £200m.
Prepaid meters were in the spotlight after some energy providers were caught breaking into the homes of people struggling to pay their bills to forcibly install them.
A Times investigation revealed how British Gas was forcing vulnerable customers, including the disabled and the mentally ill, to use pay-as-you-go meters or cut off gas supplies.
Companies were then prohibited from installing prepaid energy meters under the mandate, but this moratorium will expire at the end of March.
Energy Secretary Grant Shapps said: “While the actions I have called for have resulted in forced installations being suspended, arrest warrants not overturned and Ofgem stepping up its reviews, our changes will ensure that families are not penalized simply for the how they heat their homes.
Meanwhile, the chancellor is expected to cancel a planned £500 increase in average energy bills that was due to take effect next month.
For the average household, this means bills could remain around £2,500, rather than rising to £3,000 as previously reported.
Hunt has come under increasing pressure in recent weeks to reverse the increase, which was due to take effect April 1 as the country grapples with the cost-of-living crisis.
It comes as the universal credit sanctions regime is set to tighten as part of a new push by Jeremy Hunt to get hundreds of thousands of people back to work, raising concerns among activists.
The obligation for social recipients who mainly care for children to look for work should also be reinforced, within a series of measures that the Chancellor will announce this week in what she described as a "return to work budget."
In a review that the government called "the biggest reform of the welfare system in a decade", the work ability test, described as flawed by campaigners, will also be scrapped.
Reuters
Access
