Tuesday, March 10, 2020

Millions of over 65s overpaying by hundreds on energy and rationing heating as bills rise

Statistics suggest around 2.8 million over 65s are set to ration their energy usage during the current cold spell, due to worry that they cannot afford their energy bills. According to new research by comparethemarket.com, nearly a quarter (23 percent) of over 65s are set to ration their heating during the coming months, in an effort to combat rising household bills.

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It comes shortly after Storm Ciara and Storm Dennis hit the UK in recent weeks.

Following the periods of bad weather, research suggests that nearly half (48 percent) of over 65s are concerned that the cold weather could lead to energy bills which are higher than usual.

Should cold weather cause energy bills to rise, there is concern about how over 65s would be able to afford higher costs.

Of those aged over 65, 17 percent are worried that they would not be able to cover the cost of their bills from their income or pension alone.

And, if energy bills were to rise sharly during the colder months, more than two fifths (43 percent) have said they would have to dip into their savings or turn to credit in order to cover the cost.

Meanwhile, just over a quarter (26 percent) have said they would consider cutting down on expenditures such as food in order to pay for it.

A proportion of respondents (eight percent) said that their decision to limit the amount of heating they use during the winter causes their health to suffer, while 17 percent say they eat less or buy cheaper food in order to offset the cost of energy bills.

Peter Earl, head of energy at comparethemarket.com, said: “These findings should make sober reading for policy makers and energy company chiefs alike.

“We hear a lot of commentary about how today’s over 65s are more financially secure than previous generations, but such a broadbrush perception risks leaving millions of elderly people out in the cold and overpaying for their energy in silence.

“Not all over 65s are vulnerable, but many undoubtedly are.

“With the memory of blizzards and a nationwide blanket of snow in March 2018 still fresh in the public’s mind, it is a tragedy that nearly a quarter of the elderly say they will take measures, including rationing their energy usage, to save money in order to stay warm.”

Furthermore, comparethemarket.com data suggests that almost one fifth (18 percent) of people over the age of 65 are on an uncompetitive Standard Variable Tariffs (SVTs).

This equates to 2.1 million elderly people being on deals which could mean that they are paying over the odds.

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A further 12 percent don’t know what sort of energy tariff they have – meaning the number on a Standard Variable Tariff could be higher.

Based on energy usage, the average saving for those aged 65 and over who switch energy provider is £286, the price comparison website said.

This suggests the nationwide cost of not switching in terms of this age group alone comes in at more than £600million.

Over the past 12 months, the cost of energy has risen by £106, with the average energy bills standing at £1,813, compared to £1,706 in 2018.

The cost of energy itself has steadily been rising over recent years – with the average cost of energy coming in at £1,289 in 2015.

These findings follow a previous analysis by the price comparison giant, which found that lower income households spend £60 more on average every year when it comes to energy bills, compared to higher income housholds.

This is, in part, because these households are more likely to be on SVTs, and not switch provider.

Mr Earl continued: “If the average person aged over 65 on a SVT switched provider, the saving would be more than the annual cost of a TV license.

“For those less comfortable online, switching to a cheaper supplier by phone or post is an option that some may not realise is available.

“The energy market is more competitive than ever before, and there are many cost effective fixed deals available.”

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