Families unaware of social tariffs are missing out on average savings of at least £350 every year, Citizens Advice revealed.
Social tariff schemes offer discounts for low-income households on essential bills in markets like water, home phone and broadband, aimed at lowest-income households in receipt of certain benefits such as Universal Credit or Pension Credit.
But the charity said that due to a “lack of consistency, sufficiency and promotion of schemes by suppliers”, an “unfair postcode lottery” has been created which means identical households in different areas receive different levels of financial support.
In total, Citizens Advice estimates £1.9bn is sitting unclaimed in social tariffs across water and broadband,
To improve the take-up of the discount bills scheme, Citizens Advice has called for suppliers and the Government to be more proactive with their communication to households about what they can claim, so they know the options available to them if they receive benefits.
Only 5% of eligible customers signed up for the discounted packages on offer to those who qualify for them, a separate study from Ofcom revealed, while an investigation into social tariffs by YourMoney.com found it was far from easy to locate the ‘basic’ or ‘essential’ cheaper packages from providers.
Last year, over 140 MPs wrote to the former Government to push for the inclusion of energy bills into the social tariffs scheme, and a Bill was put forward in Parliament for it to be extended to energy bills. But, no further progress has been made and there has been no official word from the Labour Party as to whether this will form part of the Autumn Statement on 30 October.
Citizens Advice echoed the calls made last year for the energy suppliers to fall in line with the other companies, following the Winter Fuel Payment becoming means-tested and therefore axed for up to ten million pensioners.
Meanwhile, almost half of British adults have cut back their spending on two or more essentials within the last year, including car insurance and energy bills in a bid to reduce outgoings amid the continuing cost-of-living squeeze.
‘People have been in the dark for too long’
Clare Moriarty, chief executive of Citizens Advice, said: “Worrying numbers of people continue to be forced to take drastic measures, like cutting back their spending on water and energy, in the face of unmanageable essential costs.
“Social tariffs have a crucial role to play in shielding low-income households from unaffordable bills. But, for too long, people have been in the dark about extra financial support available to them, which could ultimately affect if someone keeps warm, or falls into debt on their water bill.”
Moriarty: “Solutions to this are hiding in plain sight. Putting money back into the pockets of people who need it most starts with the government ending unfair postcode lotteries in social tariffs and putting the onus on suppliers to ensure that people are getting the help they’re entitled to.”
