Britain to see 80% rise in energy bills as crisis deepens

LONDON (AP) — Jennifer Jones keeps pumping money into her energy meter, but it never seems enough. And when she can’t pay, she immediately feels the impact.

The power in his London home suddenly went out three times recently, once when his partner was cooking an egg.

Like millions of people, Jones, 54, is struggling to cope with soaring energy and food prices during Britain’s worst cost of living crisis for a generation. The former school supervisor has health problems and relies on government benefits to get by, but her social benefits are nowhere near enough to cover her soaring bills.

« I always struggled, but not as much, » she said. “Everything goes up. I can’t even pay my rent, my housing tax, I don’t have the means to do anything. …I keep asking myself, what am I supposed to do?

And things are getting worse. British residents will see a further 80% increase in their annual home energy bills, the country’s energy regulator said on Friday, after a record peak of 54% in April. This will bring costs for the average customer from 1,971 pounds ($2,332) per year to 3,549 pounds.

The final price cap – the maximum amount gas suppliers can charge customers per unit of energy – will come into effect on October 1, just as the cold months set in. And bills are expected to rise further in January to £4,000.

The cause of the increase is soaring wholesale natural gas prices triggered by Russia’s war in Ukraine, which is driving up consumer prices and upsetting European economies that rely on fuel to heat homes and generate electricity. ‘electricity.

This includes the UK, which has the highest inflation rate among the wealthiest Group of Seven democracies and has seen disruptive strikes for months as workers push for wages to keep pace the increasingly expensive cost of living.

Energy increases, coupled with rapidly rising food prices, are expected to push inflation above the 40-year high of 10.1% recorded in July and trigger a recession later this year, the forecast predicted. Bank of England. Charities, public health officials and even energy companies are warning of the catastrophic effects on the poorest people who are already struggling to afford basic necessities as wages lag.

Jon Taylor, who helps Jones and others at the debt counseling charity Christians Against Poverty, said a growing number of people who have never had debt problems are turning to the group’s helpline.

« What I’m seeing a lot right now are personal tragedies, loss of loved ones, emotional health issues, » he said. « The pressure of not knowing how to pay the next bill or having enough food to survive only compounds what they are already going through. »

About 1 million low-income households have had to take on new or additional debt to cover an essential bill, according to a May study by the Joseph Rowntree Foundation, a non-profit organization focused on poverty in the UK .

The decline in living standards is « on a scale we haven’t seen in many decades », said Rebecca McDonald, the charity’s chief economist. « This really warrants significant and creative national policy interventions to prevent what is a difficult year from essentially becoming a disaster for many low-income families. »

The UK Conservative government is under heavy pressure to do more to help people and businesses – and fast. Authorities said they were sending about 1,200 pounds to low-income people. Every household, regardless of financial situation, will benefit from a £400 reduction on their energy bill this winter.

Many say financial support needs to be doubled – at least – and some have called for an immediate freeze on how much suppliers can charge for energy. The opposition Labor Party has called for an extension of the government’s temporary windfall tax on oil and gas companies to help pay for relief.

But the government has said no further action will be announced until the Conservative Party announces a new leader to replace Boris Johnson on September 5. Neither Liz Truss nor Rishi Sunak, the two politicians vying to become the next prime minister, appear to support taxation. energy giants.

Unions in several key sectors have responded by going on strike to demand wage increases that keep pace with inflation. A series of nationwide railway strikes have brought Britain’s rail network to a standstill during peak days this summer, and postal and port workers, garbage collectors and lawyers have all staged walkouts over pay disputes.

Meanwhile, a grassroots movement called « Don’t Pay » is campaigning to bring together 1 million people to pledge not to pay their energy bills on October 1 if the price hike continues. The group hopes the massive non-payment will force energy companies to end the crisis.

« Everyone we talk to thinks the price increases we’ve seen and are going to see on October 1 are beyond a joke and will drive people over the edge, » said Jeffrey James, one campaign organizers.

« We are being forced into poverty, while others who are already in poverty will be forced into a life or death situation this winter, » he added. « That’s the level of discontent and desperation we’re talking about. »

Sylvia Hui, Associated Press