Your money-making expert. Financial journalist, TV and radio personality.
Jack Monroe in one corner, the Don’t Pay campaign in the other…
You may have heard various leftfield approaches to rising bills in the UK, from advisors on TV to radicals online advising you what to do (or not do) in the face of huge energy bills.
Can you simply refuse to pay? Or can you take a less radical approach?
First off, TALK to your energy supplier. Can they help by putting you on a fairer payment scheme? Most suppliers want some kind of regular payment from their customers but if they’re aware of your trouble paying the amount you’ve been set, they may just want to see how much you are able to pay.
Changing your energy supplier is the next step, if your current one won’t play ball. The Super Smart Energy Savers Report is worth reading: it was set up earlier this year to provide options for people having trouble paying their energy bills, and MoneyMagpie have a great comparison tool here.
Anti-poverty campaigner Jack Monroe has been quoted as advising those having trouble changing their energy supplier to set up a standing order for an amount they can afford, instead of their current direct debit.
“They won’t like it but… they won’t be able to change the amount on a standing order like they can on direct debit. It puts YOU back in control. If they use threatening/bullying tactics to try to intimidate you into changing it back or paying more, make a complaint to Ofgem. For every complaint they receive, the energy co gets fined around £375 (MoneyMagpie have looked into this and seen this as a top end number but still correct). They’d have no qualms about fining you. Hit them where it hurts them.”
The mass media are reporting that the average UK household may experience an energy bill rise of up to £4000, with many saying they can’t afford the price increase. Some are already paying nearly £400 per bill.
More radically, over 100,000 people have signed up to the Don’t Pay campaign, which started in June and which claims: “It’s a simple idea: We demand the Government scrap the energy price rises and deliver affordable energy for all. We will build a million pledges and by October 1 if the Government and energy companies fail to act we will cancel our direct debits.”
“Even if a fraction of those of us who are paying by direct debit stop our payments, it will be enough to put energy companies in serious trouble, and they know this. We want to bring them to the table and force them to end this crisis.”
IThe campaign say “t’s simple: we are demanding a reduction of energy bills to an affordable level. Our leverage is that we will gather a million people to pledge not to pay if the government goes ahead with another massive hike on October 1st…
Even if a fraction of those of us who are paying by direct debit stop our payments, it will be enough to put energy companies in serious trouble, and they know this. We want to bring them to the table and force them to end this crisis.”
Ofgem says you shouldn’t cancel the direct debit to your energy supplier.
This is in response to the Don’t Pay UK campaign, which is suggesting supporters cancel their energy direct debits on October 1st:
Ofgem however say “ask your supplier for support”
‘We are working round the clock to make sure consumers pay no more than is necessary and are supported by suppliers in any way possible.
But “Pay no more than is necessary” doesn’t actually mean what you pay can be reduced. It means the supplier will try their best to get your bills accurate, not decrease them.’
“Our rules mean suppliers must offer payment plans you can afford.”
But these payment plans are plans to repay arrears. You are expected to pay the normal bill plus an amount towards the arrears. Because it is helping with the arrears, you have to have already missed payments to benefit.
Jack Monroe, however, does NOT necessarily think this is a great idea because, she says, “if your energy company won’t let you change your direct debit, you can cancel it. Note down the banking details and reference number and set up a standing order for the amount you ACTUALLY use/can afford instead.”
Monroe goes on to say that you should carefully check the terms and conditions of your agreement with your energy company. She also directs people on prepay meters to claim benefits and support available to them, directing them to the Fuel Bank website.
Her final word on the Don’t Pay scheme is this: “When I was interviewed on both Lorraine and GMB recently and asked about the ‘Don’t Pay’ campaign, I was deliberately very cautious not to actively encourage people to withhold payment BECAUSE I’ve had my door smashed in and a forced key meter fitted myself in difficult times.
My credit rating is STILL recovering from CCJs from that period, so the LAST thing I would do is to advise people to take any action that might lead to similar consequences.”
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Interesting to see how many will withold payment.