Saturday 6 September 2008

Social housing body calls for end to 'unfair' fuel prepayment meters

Low-income families struggling to pay soaring fuel bills will stay in the spotlight this week as charities and industry bodies demand that the government stop energy companies from charging some of their poorest customers high premiums.

Following the double-digit energy price rises at Eon and Scottish and Southern (S&S), the National Housing Federation - which represents 1,300 non-profit housing associations - will launch its Energy Action Week tomorrow. It wants housing associations to pressure their MPs to take action against higher tariffs for electricity and gas prepayment meters.

Customers using these meters typically pay £150 more a year than those paying by direct debit, and around £60 more than those who pay quarterly by cash or cheque, its research shows. Prepayment-meter customers use a key, card or tokens, which can be topped up in local shops, as opposed to 'standard' customers who pay by cash or cheque on receipt of their bill. Monthly direct debit customers pay their bill in equal installments over 12 months.

These tariffs are unfair and penalise impoverished families, claims the federation, which has conducted research showing that the average income of prepayment customers is £16,000.

'A quarter of prepayment customers are "fuel poor", which means they spend over 10 per cent of their household income on gas and electricity, and this burden is only increased by the high tariffs forced on them by prepayment meters,' says John Pierce at the NHF. 'We are not opposed to prepayment meters as housing association tenants can sometimes struggle to pay large quarterly bills and the meters give them the chance to budget carefully. But it is unfair that they are overcharged when they are already struggling with a low income.'

Economy tips

· Try to switch from prepayment to cheaper standard or monthly direct-debit payments.

· If you can, change suppliers to find a cheaper tariff that suits your energy consumption.

· If you're in debt to your current supplier, you might still be able to switch if it does not exceed £100. You will then owe the money to the new supplier.

· You may be eligible for benefits and grants such as the Warm Front Programme, which can help you pay for fuel. See energywatch.org.uk.

· Most companies now offer a social tariff if you receive certain benefits. Your supplier will be able to give you more information.

· If you are struggling to pay off a debt to an energy company, contact Citizens Advice for help.

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