Labour unleash new war on pensioners as energy bills soar to pay for green agenda
An old age pensioner keeps warm with a fire during winter (Image: Getty Images)
Labour was accused of a new war on pensioners after the government’s green agenda was blamed for soaring energy costs. Gas and electricity prices will rise by 2% for millions of households under the latest cap announced by energy regulator Ofgem.
The regulator revealed bills are rising to help fund the extra costs of wind farms. The higher-than-expected increase means a household using a typical amount of energy will pay £1,755 a year, up £35 a year on the current level. It will kick in at the start of October, which campaigners say will mean another winter of high energy bills with struggling pensioners facing another “kick in the guts”.
Energy Secretary Ed Miliband (Image: Getty)
The punishing hike comes a year after Rachel Reeves snatched away the winter fuel allowance. The Chancellor eventually u-turned thanks to a Daily Express campaign.
Dennis Reed, director of the Silver Voices campaign group for the over-60s, called for the benefit to be increased to help the elderly pay their energy bills.
He said: “The increase in energy prices may be small but for those struggling to pay their bills now it is a blow to the guts.
“These continual increases on a high base should persuade the Government to raise the winter fuel payments in line with energy inflation for future years.”
Independent Age Chief Executive Joanna Elson warned: “Older people on low incomes across the country have had their budgets stretched to breaking point, and the energy price cap announcement will bring further anxiety.
“Winter is around the corner and even small increases will be too much to bear for many of the people in later life we speak to who are already making drastic cutbacks. Last winter, too many older people in financial hardship were left behind choosing between heating and eating.”
Energy costs will go up for homes in England, Scotland and Wales despite wholesale prices falling. It makes a mockery of Ed Miliband’s vow to cut energy bills by £300.
Ofgem said one of the drivers of the price rise was an increase in balancing costs, where the National Grid must pay to either bring on or turn off electricity generation to keep supply and demand in balance at all times.
Unpredictable sources of generation, such as renewables like wind and solar, make the task more difficult.
Energy minister Michael Shanks insisted the rise in bills was evidence of the “fossil fuel penalty being paid by families, businesses and our economy”.
But shadow energy secretary Claire Coutinho said this was “patently untrue” and blamed the rise on the cost of the transition to renewable energy.
Ms Coutinho said: “Labour promised to cut bills by £300 but that couldn’t be further from the truth. Standing charges are up by up to 14%, and balancing costs have risen meaning our energy bills are going up even while wholesale prices are falling.
“It is patently untrue to blame the ‘fossil fuel rollercoaster’ for today’s bill rises. Bill rises have come from balancing costs – the costs of using renewables – and rising standing charges from Labour’s social redistribution policies.
“These figures and Labour’s response make it crystal clear that Ed Miliband is not interested in the truth or cutting bills.”
Rachel Reeves (Image: Getty)
ANALYSIS: By Martyn Brown Political Editor
Labour’s incessant drive to build more wind farms to produce green energy comes at a huge cost.
Gas and electricity bills have rocketed for millions of people who are already being clobbered by a rise in the cost of living.
Since taking office the price cap for the average household will have shot up by almost £200, from £1,568 to £1,755, when it kicks in during October.
This substantially outpaces wage growth and ultimately leaves households poorer.
Many factors are outside the Government’s control, such as international gas prices.
But Labour’s rush to hit their 2030 clean power target risks pushing bills even higher.
And it’s pensioners, yet again, who are bearing the brunt.
After having the winter fuel payment cruelly snatched by Rachel Reeves last year, the elderly are facing another winter of discontent due to sky high bills.
Campaigners have warned they are facing fresh anxiety over the bill hikes after being driven to breaking point by the Chancellor’s doomed policy to remove the benefit.
But with very little money left in the Treasury’s coffers and a £50 billion black hole to fill millions of people are facing painful months ahead.
Donald trump playing golf in Scotland (Image: Getty)
Reform UK deputy leader Richard Tice said: “Energy prices to rise again, by 2% ahead of winter. They are 12% higher than July 24.
“Labour promised bills would come down – they lied. More renewables equals higher bills.”
Energy standing charges – which consumers pay to have energy supplied to their homes per day – will rise by 4% for electricity and 14% for gas.
This has mainly been driven by the government expanding the Warm Home Discount which benefits around 2.7 million low-income families.
Dillon Smith of the Centre for Policy Studies said: “These depressing numbers will provide little comfort to households up and down the country struggling to pay their energy bills. Labour promised to cut bills, yet since taking office Ofgem’s price cap for the average household had already risen from £1,568 to £1,720 today, and is now set to rise to £1,755 from October, substantially outpacing wage growth and leaving households poorer.
“Undoubtedly, many factors are outside the Government’s control, such as international gas prices. But what’s maddening is that Labour’s rush to hit their 2030 clean power target risks pushing bills even higher.”
The rise in bills will hit at around the same time as Ms Reeves is expected to hike taxes in the Budget as she desperately attempts to fill a £50 million financial black hole.
Families are also braced for food inflation to hit 5.5% by the end of the year.
The British Retail Consortium said that food costs were rising at their fastest rate since February last year, with the price of chocolate, butter and eggs soaring.
Earlier this week US President Donald Trump told a cabinet meeting that wind turbines had caused UK energy costs to go “through the roof” as he predicted a “bad awakening very soon”.
Liberal Democrat leader Ed Davey said “the last thing” families and pensioners needed was higher energy bills this winter.
