CENTRICA’s boss has called for the energy regulator to abolish standing charges which add around £300 to customer bills.
A day before the release of Ofgem’s new price cap, Chris O’Shea told The Sun the regulator should change the “really unfair” system to make it “more affordable and easier to understand”.
Mr O’Shea said: “The standing charge hits those who are careful about their energy use hardest — and these are often people from low-income households and prepayment meter customers.
“I know from conversations with prepayment customers that the standing charge can see them unknowingly build up debts over the warmer summer months.”
The Centrica boss said the regulator should scrap the standing charge and roll the costs into the unit cost of the price cap so “those who carefully manage their energy use could see big benefits”.
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Martin Lewis, the consumer champion, yesterday said: “We are pushing for standing charges to be lowered.”
Centrica was hit by scandal earlier this year when its British Gas debt agents broke into vulnerable people’s homes to forcibly install prepayment meters.
Mr O’Shea apologised and has committed to ending the practice for vulnerable homes.
Centrica made record profits of £3.3billion in the past year on the back of higher energy prices boosting its exploration, trading and production businesses. But profits in its British Gas supply division fell from £118million to £72million.
Mr O’Shea yesterday repeated his call for a social tariff for those who need support to pay bills.
The Government stepped in to help households during the past year’s energy crisis amid fears bills could rise as high as £6,000.
However, there was wide criticism that the relief would have been better targeted with larger sums for poorer households.
Mr O’Shea said: “We can’t have a system where the rich get as much support for their energy bills as the poor — that is just plain crazy.
“The introduction of a social tariff should be a game-changer for consumers who are struggling with energy costs, food bills, rents and soaring mortgage rates.”
The energy veteran has also called for the regulator to end the postcode lottery of energy pricing, which sees some areas paying more for their bills because of the cost of transporting electricity.
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Energy 'scam' rap
POWER generators will be banned from a wheeze which cost the National Grid £525million last year.
Ofgem plans to clamp down on generators who say they are going to switch off, then switch back on again when prices are higher at peak times. Firms, such as Vitol VPI, Uniper and SSE have been accused of demanding “excessive” prices.
Under new rules generators that need over an hour to switch off and on again will not be allowed to charge significantly higher prices than if they had just kept running.
Togs 'will fall'
THE boss of retailer H&M has hinted that fashion prices could start to fall as inflation eases.
Since the pandemic clothing chains have faced a barrage of extra costs from higher cotton, polyester, factory-gate and shipping prices.
However, Helena Helmersson said raw material costs were now falling so clothes could become cheaper. “Of course that comes with an opportunity to adjust prices,” she said.
Shares in H&M hit their highest level for more than a year and a half after its reported cost-cutting measures helped profits of £343million beat expectations.
Ms Helmersson said that H&M, COS and Arket’s summer collections had proved popular, with sales in June ten per cent higher than last year.
Bargains a boost for B&M
SHOPPERS have boosted sales at B&M Bargains as they switch to discounters to make their cash go further.
The company behind B&M said sales had risen 13.5 per cent to £1.3billion in the three months to June 24.
At its UK stores, sales were up 11.3 per cent, while its cut-price grocery business, Heron Foods, grew sales 19.4 per cent.
Boss Alex Russo said strong trading was down to “relentlessly focusing on price, product and excellence in retail standards”. B&M wants to expand from 707 shops in the UK to 950 in the next few years.
Julie Palmer, partner at Begbies Traynor, said: “Discount retailer B&M is reaping the benefits of being perfectly positioned to cater to hard-pressed consumers.”
Despite the strong trading, shares in B&M fell six per cent to 555p yesterday as investors were disappointed bosses had not taken the opportunity to boost profit forecasts.
Slide is on cards
ONLINE greeting card firm Moonpig has posted its second fall in profits since becoming a public company.
The Moonpig.com owner said pre-tax profits had fallen 12.6 per cent to £34.9million after it was hit by Royal Mail strikes over Christmas, higher interest rates and investing in more technology.
Sales rose by 5.2 per cent to £320million in the year to the end of April after increasing the price of its greeting cards.
Bank poorcast
THE Bank of England has admitted that its forecasting models have struggled to predict trends but argued any central Bank would flounder.
Huw Pill, chief economist, defended the Bank’s record, which has incorrectly predicted unemployment, growth and inflation figures, saying: “All economic models are wrong, but some are useful.”
Referring to the pandemic and Russia’s invasion of Ukraine, he added: “Any single model would have struggled to capture the impact of these economic shocks.”
Home loan rise
HIGH street banks have hiked mortgage rates again.
The average two-year fixed-rate mortgage is now 6.37 per cent and a five-year fix is 5.94 per cent, according to finance site Moneyfacts. In 2021 it was 2.25 per cent.
The Bank rate was raised last week to five per cent but the average easy access savings account gives customers interest of 2.37 per cent.
Analysts at Schroders said they expected more hikes to 6.25 per cent. The Government has told the watchdog to clamp down on profiteering.