Over 150 MPs join campaign to stop energy rip-off for poorest families
9th May 2007
Alan Whitehead tabled Early Day Motion (EDM) 990 "Fuel poverty and pre-payment meters”, in February this year. His parliamentary motion has, to date, received the backing of 156 cross-party MPs, who join his call for energy companies to stop setting higher charges for customers on prepayment meters.
The six main energy companies are in the middle of a price war. However, their lowest earning and most loyal customers, those who pay with a key or token meter, can pay up to £188 more per year for their energy than a customer paying by direct debit. They can pay up to £133 more than quarterly billed customers (1).
The National Housing Federation has been lobbying to get energy companies to charge customers the same amount for gas and electricity whether they pay by prepayment meters or are billed.
They gained the support of Dr Whitehead to table the parliamentary motion after he learned that many of his own constituents faced these unfair charges, with Swaythling Housing Society, a Federation member based in Southampton, writing to local energy supplier SSE to demand that it equalises its pre-pay meters.
Housing associations around the country are sending postcards to local MPs calling on them to sign the EDM, and writing to suppliers to demand they bring prepayment meter tariffs into line with standard credit charges. An estimated 30 per cent of housing association households have a gas prepayment meter; an estimated 43 per cent have an electricity prepayment meter.
Dr Whitehead said:
“I was pleased to be able to table this parliamentary motion and raise the issue of fuel poverty and the unfair charges levied against those on pre-pay meters in the House of Commons back in February. The fact that this has now been backed by over 150 MPs shows the considerable support for this campaign, and should show the energy companies that this practice will no longer be tolerated.”
He added:
“I hope that as a result of the level of support in parliament that we now see immediate action by the Energy Companies to rectify this unfair anomaly that hits their poorest customers. I know that some energy companies have gone some way in trying to resolve this issue but it is now crucial that they fully commit to halting this unfair practice which discriminates against many of my constituents in Southampton and across the country.”
David Orr, chief executive of the National Housing Federation, said:
"The energy companies might be knocking down their prices but they are still fleecing prepayment meter customers. MPs of all parties share our belief that this rip-off has to stop.
"Too often, the poor pay more for the kind of services most people take for granted. Prepayment meter customers pay over the top even though they settle their bills up-front and rarely switch supplier.
"Energy companies should bring their prepayment meter tariffs into line with their charges for standard credit consumers. They should absorb any additional overheads themselves rather than passing them on to their poorest customers."
The Federation's campaign website is at www.housing.org.uk/fuel.
More information
- Source: Energywatch price comparisons
- Full text of EDM 990:
‘That this House notes with concern that users of pre-pay meters (PPMs), who, according to Ofgem research, are concentrated amongst low-income consumers, pay as much as £123 per year more for their gas and electricity than other account-based users; acknowledges that PPMs can incur additional unit and infrastructure costs, but notes that this has not prevented some major suppliers from equalising PPM tariffs for electricity with standard credit tariffs; further notes with concern that recent price cuts from some suppliers leave most PPM customers further adrift from consumers paying by other methods; and supports the calls made by the National Housing Federation and housing associations to the major suppliers to align all PPM tariffs with standard credit rates to help bring low-income consumers in from the cold.’
- The National Housing Federation represents 1300 independent, not-for-profit housing associations in England. Together, our members provide 2 million affordable homes for around 5 million people. www.housing.org.uk