British Gas sends us the bill as the government dithers with its promised energy cap

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Citizens look set to receive the bill for an unfulfilled Tory manifesto pledge, as British Gas puts up its prices in the absence of a meaningful energy cap.

Higher energy bills

Millions of British Gas customers on its standard variable tariff will see their energy bills rise by 5.5% to an average £1,161 a year. The rise will hit 4.1 million of the firm’s 7.8 million customers, who will pay £60 extra a year from the end of May. It follows the 12.5% increase in electricity prices imposed last September. In addition, the company confirmed it had also removed its cheapest deal, an online-only tariff.

Mark Hodges, chief executive of Centrica Consumer (part of the British Gas parent company), said:

We fully understand that any price increase adds extra pressure on customers’ household bills. This increase we are announcing today is reflective of the costs we are seeing which are beyond our control.

British Gas has blamed higher energy costs, government policies to reduce carbon emissions, and the £11bn smart meter programme for the rise.

Centrica had a 2017 adjusted operating profit of £1.25bn.

Where’s our energy cap, Theresa?

Prior to the 2017 election, the Conservatives promised to cap energy bills. These plans have since been kicked into the long grass.

But that hasn’t gone unnoticed, especially in the light of the most recent British Gas price hike:

“Disappointing”, “unjustified”, and “unwelcome”

Conservative minister for energy and clean growth Claire Perry has said:

We are disappointed by British Gas’s announcement of an unjustified price rise in its default tariff when customers are already paying more than they need to.

And:

This is why government is introducing a new price cap by this winter to guarantee that consumers are protected from poor value tariffs and further bring down the £1.4bn a year consumers have been overpaying the Big Six.

The BBC reported that energy regulator Ofgem described the increase as “unwelcome”.

The result of an unfulfilled Tory manifesto pledge?

In her conference speech in October 2017, Theresa May declared that the government would introduce an “absolute” cap to “bring an end to rip-off energy prices once and for all”. She said:

While we are in favour of free markets, we will always take action to fix them when they are broken… We will always take on monopolies and vested interests when they are holding people back.

The energy market punishes loyalty with higher prices and the most loyal customers are often those with lower incomes, the elderly, people with lower qualifications and people who rent their homes.

After the conference, the government delayed imposing the cap until February 2018, when it announced that it would happen before next winter.

Apparently taking advantage of the delay, British Gas has now put its tariffs up. And once again, it will be the poorest and most vulnerable people hit by an unfulfilled Tory promise.

We should remember this when we are in front of the ballot box on 3 May.

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Featured image via KRoock74/Wikimedia Commons

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