Energy providers “stockpiling” money
It seems that the Daily Mail and minister Greg Barker do not understand what direct debit is all about.
Energy giants are to repay customers up to £2 billion which they have stockpiled from direct debit overpayments.
Yes, they have our money and it will pay for our winter usage. In my view, setting up a direct debit to your energy provider allows you to pay the same amount all year round regardless of what you actually use. Then, your annual review will adjust your direct debit value. For instance, if my bills were based on readings, in the summer I would pay £30 and in winter – £80. DD allows me to pay £55 every month and I get a discount. Throughout the whole summer, I save towards the energy-demanding winter so that I do not have to worry. (I do worry anyway but at least I know how little heating I can afford.)
For this to work, I have to know my energy needs and for that I need those pesky energy statements nobody apparently understands. I need to provide meter readings regularly to ensure that I am not over- or underpaying. I must be aware how any changes will affect my energy consumption (a baby/partner/elderly relative moving in or out, a redecoration project involving steaming off woodchip wallpaper throughout the house, upgrading my appliances or draught-proofing) and ask for the DD to be adjusted accordingly.
For some time, the energy provider will have my money because I am saving it for winter. I can just as well put it in a jar or in a separate bank account and pay tax on any meagre interest. What is the problem with someone making a profit where I cannot make any? Instead, I get my discount and the peace of mind and am happy with it.
Next winter, those applauding the Big Six’s “concession” will wake up with their hands right in the potty when it turns out that one month’s energy money will not pay for winter excesses like having the heating on in the evenings. There will no doubt be another round of price hikes and this time it will be accompanied by steep increases in direct debits because people will have underpaid throughout the year and will be in the red.
Can’t afford to pay? They will install a pre-payment meter (they like to rip off the poor the most). They will not let you switch. They will give you little choice when it comes to tariffs. They will finish you off. Of course, nobody can see that coming.
The whole give-us-back-our-money is just a shameless propaganda. Nothing really changes. There is nothing to be happy about. There is no victory. Thousands of vulnerable people will die needlessly this winter. Meanwhile, the energy companies’ profits are not endangered in the slightest.