The sharp jump will add even more pressure on Sunak to help consumers struggling with the worst squeeze on living standards since the 1950s. Even with the £9 billion of assistance announced so far, it won’t be enough to prevent 40% of households falling into fuel poverty, according to the industry bosses.
Ofgem Chief Executive Officer Jonathan Brearley will write to Chancellor of the Exchequer Rishi Sunak to warn him of the impending increase of more than £800 to bills for about 22 million households, he told a panel of lawmakers on Tuesday.
The hike means that “more is needed” and Ofgem is calling on the government to provide more support to customers, Brearley said.
“There are significant lessons to be learned from this crisis and change is absolutely needed to the way we regulate the retail market,” he said. “The price changes we’ve seen in the gas market are genuinely a once in a generation event not seen since the oil crisis in the 1970s.”
Brearley apologized for not acting sooner and acknowledged how distressing this was likely to be for consumers already facing record costs for everything from food to petrol and energy. The period for assessing and decide on the next cap is only halfway through and volatility in gas markets is still high, he said.