Linda, 70, has never been in debt before. Now she’s hundreds of pounds in the red, and the credit on her energy meter often runs out three or four days before her pension arrives. “I could afford my bills before, but I’m really struggling now,” she told the BBC, asking to remain anonymous out of embarrassment.
She is not alone. More than £7bn in bills and charges was owed to water, broadband and energy companies by March last year, the National Audit Office (NAO) has revealed – and that total has almost certainly grown since. Household energy debt alone has jumped by 118% since Russia’s invasion of Ukraine in 2021, reaching nearly £4.3bn, with four million water accounts in debt worth almost £3bn.
“Household debt to water, broadband and energy firms tops £7bn as most billpayers remain unaware of social tariffs.”
Yet the vast majority of billpayers have no idea help exists. The NAO found that only 39% of water customers and just a third of broadband customers who are eligible for cheaper social tariffs even know they are available. These discounted packages, often aimed at people on benefits or struggling to pay, vary between suppliers but can make essential services affordable.
Gareth Davies, head of the NAO, said: “Regulators have made progress to support consumers, but they’re not keeping up with the pressure now facing millions of households. With debt rising sharply, it’s more important than ever to make regulation work so that people know what support is available and can contact essential providers when they need to.”
The report examined the work of Ofgem, Ofwat and Ofcom. It found that while Ofgem and Ofwat have overseen more people registering for Priority Services Registers – which help identify customers with extra communication, access or safety needs – awareness of those registers also remained low. Ofcom, the report noted, did not routinely monitor take-up or awareness of support for broadband customers.
One key finding: energy customers who agree a repayment plan with their supplier owe around £1,000 less than those without one. Yet fewer than half of households in energy debt (40%) have such a plan in place.
Sir Geoffrey Clifton-Brown, chair of the Commons Public Accounts Committee, said: “Price volatility is now the norm across much of the energy sector, and consumers are at the sharp end of this. It remains too difficult for consumers to contact companies when things go wrong, financial support is poorly promoted, while basic billing errors are pushing households further into debt.”
The NAO has recommended that regulators increase awareness of social tariffs and repayment plans, tackle drivers of rising debt such as inaccurate billing and delays when people move home, and improve how vulnerable consumers are identified and supported. But for Linda, who is repaying in instalments that never seem to reduce her debt, the question remains: how many more are missing out?