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Pensioners’ costs soar despite energy price cuts
Tuesday 27 January, 2009
By becca.talbot@consumerchoices.co.uk
The cost of living for pensioners is four times the official rate of inflation despite energy price cuts, according to experts.
Pensioners are being hit the hardest by the rising costs of living, especially if they rely on savings for their income, according to research undertaken for The Daily Telegraph by Capital Economics.
The Office for National Statistics said last week that the Consumer Prices Index (CPI), the government’s measure of inflation fell by the greatest amount in more than a decade, sliding from 4.1% to 3.1%.
Many pensioners, however, are finding their finances squeezed, especially if they are depending on their savings. As gas and electricity bills continue to hit an all-time-high, as well as increases in council taxes and food prices, many Brits over the age of 65 are struggling to cope, despite gas prices falling and consumer prices are starting to come down.
Charity Age Concern commended British Gas (www.britishgas.co.uk) for last week reducing its gas prices by 10%, but warned that unless other suppliers follow with further price cuts, poor pensioners will continue to struggle during the colder months.
Gordon Lishman, director general of Age Concern, said: “Even with price decreases‚ millions of the poorest pensioners and families will still be living in fuel poverty and will continue to pay more for their energy than wealthier customers.”
The number of pensioner households in fuel poverty has more than doubled since 2004, according to statistics from the charity, which estimates that one in three older households is in fuel poverty in the UK.
Lishman argues that more awareness needs to made about social tariffs and the discounts and benefits that are available to those who need them most.
He said: “It is essential that social tariffs are reformed and the pricing penalties leaving cash, cheque and prepayment customers paying more for their energy are removed.”
Chris Eagle, commercial manager at EnergyChoices.co.uk agrees that more needs to be done to help make sure pensioners are on the cheapest and best energy tariffs for them. He said: “The number of elderly households that are unaware of the fuel discounts they are eligible for is too high, and there is a definite need for the promotion of social tariffs and government energy benefits.”
“You will definitely save money if you switch from your standard tariff (where paper billing is used) to an online tariff (where bills are sent electronically) as this saves the energy supplier money for which discounts are passed on. Also if you are not already, make sure you pay your bills by direct debit for further savings.”
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Wheelchair bound pensioner Dora Kennedy, 79, had been struggling with her high Economy 7 electricity bills, until she was advised by EnergyChoices.co.uk to sign up to a social tariff. Dora, who suffers from the rare, life threatening illness Addison’s Disease, was told by her energy supplier Scottish Power (www.scottishpower.co.uk) that her direct debit was assessed as £46 a month. As her only source of income is a small government pension and a severe disability premium, received through her severe arthritis in her lower spine, hips and knees, Dora was shocked about the price of her energy bills. Cared for, bathed and fed by nurses in an Extra Care apartment block in Weston-super-Mare, her excessive bills were a worry: “As I live alone and never have anyone staying over, £46 a month seemed unreasonably high to me.” Dora hadn’t heard of a social tariff before using the site, and was unaware of the benefits of switching. After a quick call to Scottish Power she’d signed up to a new tariff and lowered her bills Dora agrees that more needs to be done to promote the cheaper services available to those who need them the most. She said: “Most of the residents here in my apartment block - all elderly and frail - to whom I have mentioned my cheaper social tariff have never heard of it, - and ask me how I found out about it. It’s because I keep my eyes and ears open; while my body may be ready for the scrapheap, my brain is ready for Mastermind!” |
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