The MoneySavingExpert.com (MSE) website founder took a break from his social media hiatus over the summer to share his response to Ofgem’s October price cap announcement this morning
Martin Lewis has issued his reaction to news that energy bills will rise by an average of £149 a year from October.
The MoneySavingExpert.com (MSE) website founder took a break from his social media hiatus over the summer to share his response to Ofgem’s October price cap announcement this morning. The energy regulator confirmed that its price cap for typical households paying by direct debit will rise to £1,717 from October, up £149 from the current level of £1,568.
This is around a 10% rise on the previous price cap and will add an extra £12 to the average monthly bill according to Ofgem. In a post to X, Martin Lewis noted that from October, households would be paying “nearly double” they were pre-crisis. He also noted that most of the rise seen today is on the unit rate and not the standing charge. This means that high users – particularly high gas users – would overall see their costs rise by more than the cited 10%.
Due to the rise, Martin urged the Labour Government to “rethink” scrapping the Winter Fuel Payment for 10million pensioners this winter. He said: “Govt must rethink Winter Fuel Payments or almost ALL pensioners will need to find £100s more than last winter. While energy will cost less than during last winter’s crisis time, the reduction in rates only equates to a drop of roughly £100 over the six winter months for a household with typical usage. Yet specific pensioner energy support has dropped by far more…”
Martin noted that the loss of the £300 “alone is far bigger than the saving made by slightly lower rates”. Alongside this, Martin highlighted that “means testing” the support would leave “all except usually those who claim Pension Credit missing out on a further £200 – £300.
He added: “While there’s a strong argument for ending the universality of Winter Fuel payments, eligibility is being squeezed to too narrow a group. Those just above the thresholds will be hardest hit. I’m due to meet the Chancellor in a couple of weeks, and will then be urging her to look at methods to widen eligibility – such as to homes in council tax bands A to D – an imperfect but workable proxy for lower household incomes.”
Ofgem today urged energy customers to consider fixing their energy bills to protect themself from the hikes – particularly as energy prices are to rise higher into January 2025. Martin also reiterated this message in his post adding: “People can and should save by switching: The cheapest year-long fixes on the market right now are about 7% LESS than the new October price cap, but they mightn’t be around long, That looks a good deal, as its currently predicted once rates go up they won’t come down.”
However, the MSE founder warned Brits not to jump on any fix. If you want to lock into a deal, Martin said you should grab the “cheapest for your use and location” and to get this, you should use a “whole-of-market comparison, like MSE’s Cheap Energy Club.”
Finally, Martin noted that he “welcomed” the launch of the long awaited consultation into reducing standing charges. However, was “slightly disappointed” that the proposed reduction was only £100 a year. He said: “The Standing Charge is a daily poll tax that means everyone with gas & electricity pays a minimum of £338 a year even if they don’t use it. This moral hazard penalises lower users, often many who are vulnerable, and means they will face a proportionately larger rise.
“I’ve long called for change, so welcome today’s long promised consultation on reducing standing charges today – though I’m slightly disappointed even the maximum proposed reduction is only £100/yr – but I’ll hold judgement until I’ve read the consultation in full.”