Rising energy prices have been a major issue for UK households; an issue that’s been rising up the political agenda for quite some time now.
With former Labour leader Ed Miliband pledging a price freeze during the 2015 general election, and Theresa May’s Conservatives thought to be offering an energy price cap in their 2017 manifesto.
And according to comparison website ComparetheMarket.com, the market intervention could be a savvy political move – in a recent poll they carried out discussing people’s ‘personal finance wishlists’, more than a fifth of those surveyed believed that an energy price cap was the personal finance priority they’d most like to see the next government tackle.
ComparetheMarket’s director, Jesper With-Fogstrup, was keen to emphasise just how strongly UK households feel about their rising energy bills, which coupled with stagnating wages and an increase in the cost of living, is proving to be a serious financial burden on household budgets. He said:
‘The past two years has been a tricky time for energy customers, particularly those floundering on standard variable tariffs who have faced a series of price hikes from the Big Six and other providers. People are clearly worried by the cost of energy and any initiative which seeks to ease the burden of paying for gas and electricity will surely be welcomed by voters.’
As if to prove their point, while drumming up publicity for their own comparison services, ComparetheMarket also revealed, days later, that up to 600,000 households could be paying on average £333 more for their energy if they don’t switch tariffs or providers by the end of June – the time when 70 fixed price tariffs will cease. All told, those extra pennies will see the big energy companies take home a whopping £200 million extra. Peter Earl, who heads up energy at the company, said:
‘The cost of not actively monitoring your energy bills is clearer than ever, with energy companies potentially enjoying close to a £200 million inertia windfall from customers who don’t choose to switch. A £333 increase in annual energy bills could be devastating to so many families across the UK. However, the good news is that this can be avoided – by switching back on to a competitively priced fixed tariff which best suits your needs.’
But it wasn’t just energy costs that those surveyed want to see on their ‘personal finance wishlist’, with the second most popular wish to see an increase in personal tax allowances. That’s the amount of money you earn that you don’t have to pay income tax on; the current personal tax allowance – which began on April 6th this year, and ends on April 5th 2018 – is £11,500. According to the survey, 18% want to see that figure rise, leaving them with more money in their pockets to spend as they see fit, rather than seeing the Treasury take a larger slice.
ComparetheMarket’s personal finance survey also showed that over a third of those polled feel less well off now than they did two years ago, at the time of the last election. With economic uncertainty looming, rising inflation, lack of wage growth and the ‘Brexit effect’ on the pound, many feel it’s all beginning to take their toll on household budgets. Whether an energy price cap and an increase in personal tax allowances is likely, and will help to ease that financial burden remains to be seen.