Steve McCabe MP has called a Government decision to raise the energy price cap at the very time when unemployment is set to soar as ‘ratcheting up not levelling up.’
Today Ofgem announced the energy price cap will return to pre-pandemic levels on 1 April 2021, putting thousands of households at risk of fuel poverty.
The most recent Government data shows 61,560 households in Birmingham in fuel poverty which is a shocking 14.2% of all households. In Selly Oak constituency, the proportion of households in fuel poverty is also estimated to be 14.2%, at 6,171 households but these figures actually date back to 2018 and it is expected they will have risen significantly given the sharp rise in unemployment since the onset of the pandemic.
The rise will be particularly hard for the 5,610 people in Selly Oak currently in receipt of Universal Credit who are set to lose £20 a week unless the government backtracks, at the last moment, on its plans to remove the uplift in Universal Credit provided at the start of the pandemic.
The news comes just days after research from USwitch found 3million households say their finances are so stretched they fear any rise in bills. The increase in energy costs will be felt by many households using more energy because of working at home, homeschooling and where vulnerable people have been shielding.
Labour has been calling on the Government to fix the broken energy system and prioritise making homes more energy efficient in order to reduce bills. They propose extending and expanding the social housing decarbonisation fund and extending the £2bn green homes grant, due to end in March, by at least another 18 months.
Steve McCabe MP said:
“With unemployment at a 5-year high, now is exactly the wrong the time to force up energy prices. Today’s announcement will cause thousands of households to worry about unaffordable bills. This increase in energy prices will push large numbers of families into fuel poverty. Instead of driving up energy costs, the Government should fix the broken energy cap and ensure energy efficient homes which will bring down costs and help to protect our environment. I’m afraid this is ratcheting not levelling up”