Energy crisis: Martin Lewis erupts at government over price cap
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Many households are set to see their bills rise around 80 percent from October 1. Ofgem has announced that the energy price cap will increase from £1,971 a year to £3,549.
On BBC Breakfast this morning, the money saving expert explained what those on direct debits can expect to see when it comes to their bills.
Presenter Naga Munchetty asked him what people can be doing when they look at their bills now as there are no great deals on fixed rates.
Mr Lewis said: “If you are in credit and you are on the price cap, you should be expecting an increase on your direct debit of roughy 80 percent.
“Let’s give a bit of wriggle room. Let’s say 65 to 95 percent. If you’ve got that then what I’d suggest you do is swear a lot and take it because that’s about right.
“If it’s going up very substantially more than that, and you’ve been on the price cap and you’re in credit then I’d suggest there has been a calculation error.
“Now I’ve complained to Ofgem and put evidence to parliament and we have seen some real changes tightening up how direct debits work on the back of that.
“Also my team are working on publishing how the big energy companies asses direct debits and set them, so you can look at your energy firm and how they assess direct debits and see if yours has been done correctly.
“If you’re in debt then you will expect your bill to go higher if you’re moving off a fix or on onto one you would expect to see your rise being higher.”
Mr Lewis warned if someone’s direct debit has gone up by more than 100 percent, the company should be reviewing it.
Some people may be considering stopping their automatic monthly payment to give them more control over their outgoings.
However doing so could mean they end up paying more each month.
When people set up a direct debit for their energy bill, they pay a set monthly amount which is automatically paid from their bank account to their supplier on a set day of the month.
Those who pay by direct debit will often get a discount, for example British Gas customers can get as much as seven percent off.
Citizens Advice has suggested what Britons can do if they see their direct debits increase more than what they expect.
Britons can challenge the increased direct debit payment amount with their supplier if they disagree with it.
The website states: “Ask your supplier to justify how they calculated the new amount.
“They must explain clearly how they reached the figure they want to charge, and give you the meter readings they used.
“When you look at the meter readings, check them against the meter readings on your bill to see if they are the same. Remember that your usage will be higher in the winter months.”
If someone fears they have paid too much, they may be able to claim back money from their supplier.
However before claiming back any money, think about:
- Whether they’re likely to have higher energy bills in the months ahead
- If it will be difficult to pay the bills without keeping the credit on the account
BBC Breakfast will continue on BBC one at tomorrow at 6am.
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