UKAR ARENA | A NEWSLETTER FOR DEBT ADVISORS | SPRING 2016 | ISSUE 11 | UKAR-ARENA.CO.UK
LOUISE YATES.
Head of External Affairs, Johnson Geddes Ltd,
Insolvency Practice
One of the largest growth areas in terms of types
of debt is definitely fuel/energy.
It’s also the area that has the biggest impact on
the vulnerable. Those on low incomes are the most
susceptible to the seasonal changes in their fuel
cost and often fall behind in the winter months. If
the arrears were related to a consumer credit debt,
the creditor would be required to take into account
the clients affordability and other debts in calculating
the repayment of arrears.
Instead the energy firms have the right to force
installation of prepayment meters on debtors.
The meter acts like a debt collector in their own home.
Forcing repayment of debt BEFORE it will provide the
essential heat and light.
Adding insult to injury, the average pre-pay user
paid £177 more on their gas and electricity bills than
a customer paying by Direct Debit, with a difference
of £432 between the most costly pre-pay tariff and
cheapest Direct Debit tariff.
It’s compounding the debt problem not solving it.
In my experience, fuel debt has been a reason for
turning to high cost payday lending for many low
income households and this cannot be ignored.
“IN MY EXPERIENCE, FUEL
DEBT HAS BEEN A REASON
FOR TURNING TO HIGH
COST PAYDAY LENDING
FOR MANY LOW INCOME
HOUSEHOLDS AND THIS
CANNOT BE IGNORED.”
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