Energy crisis: State pension warning as millions of Britons face ‘devastating’ blow

State pension rise is 'woefully insufficient' says expert

We use your sign-up to provide content in ways you’ve consented to and to improve our understanding of you. This may include adverts from us and 3rd parties based on our understanding. You can unsubscribe at any time. More info

New research released on Wednesday revealed that energy prices in Great Britain are expected to remain significantly above average until 2030. The analysis has sparked concerns that the most vulnerable people in society, including older people reliant on fixed incomes, will be faced with impossible decisions to survive.

Analysis from Cornwall Insight showed that energy prices will remain in excess of £100/MWh annually for the next decade and possibly beyond. The highs are well above the previous five-year pre-2021 average of £50/MWh in Winter and the even lower prices in pre-2021 Summer.

Although forecasters predict prices may temporarily drop from the all-time highs seen in recent months, they will remain high and likely hike beyond the record levels seen in the coming years.

Tom Edwards, senior modeller at Cornwall Insight, said: “While we are used to seeing headlines depicting energy prices at an all-time high, unfortunately, while prices will reduce, our modelling shows that pre-2021 prices are not making a comeback this decade and likely beyond.

“Rising EU demand for non-Russian gas has pushed up gas prices across the world, and these higher prices have increased production costs for power, with gas set to remain the marginal fuel source for producing power throughout the remainder of the 2020s.

“With all Great Britain coal capacity due to close by April 2024 and many nuclear power stations coming to the end of their lives, high power prices will continue to feed through into consumer bills.”

The latest news has prompted widespread concern that Britons currently grappling with an unprecedented cost of living crisis, including mammoth fuel bills, rising food prices and record inflation, will be unable to cope.

Activist groups that represent older people are particularly worried that pensioners on fixed-term incomes will run out of options on ways to sustain themselves unless the Government takes drastic action to support them.

Dennis Reed, director of Silver Voices, told Express.co.uk millions of older and vulnerable had “passed the point” where they could employ “money-saving tips” to get by and were being forced to give up basic necessities.

He said: “Last year, everybody was offering tips on how to reduce costs. This was before the recent hike in fuel and oil prices. And people could scarcely manage before, let alone now.

“The brutal reality is that millions of people, particularly older people who are on fixed incomes, can’t actually afford the bare essentials of life.

“It’s all very well saying you have to choose between heating and eating, but that’s a decision which people sometimes can’t make. It’s not a question of just cutting down a little bit on fuel – a lot of people have already switched off their heating and they aren’t switching it on again.

“A lot of people have given up their TVs because they can’t afford TV licences and they don’t want to break the law, and they can’t afford appropriate food.”

He added: “It’s impacting all aspects of their lives. Because any sort of luxuries they might have had like outings or going to the cinema or having the odd meal out once a month or something like that, they’ve all gone and there’s nothing left to cut.”

Jan Shortt, general secretary of the National Pensioners’ Convention (NPC), said that older Britons were already facing impossible choices.

She told Express.co.uk: “People need to remember that many people who are pensioners are on a fixed income. When you’re on a fixed income, there’s not much wriggle room. It only takes one thing to increase and you are then in the realm of making decisions about how you apportion the money you’ve got.

“Most people survive on £10,000 a year or less. It’s a very limited amount of income. So anything that increases in price, you have to sit down and budget.”

Ms Shortt said recent changes such as the Government’s suspension of the triple lock pension pledge in September and the decision to scrap the free TV licence for over 75s, alongside record inflation and rising food prices were taking a toll.

She said: “All of those things are impacting on those who have a fixed income so it is absolutely devastating for people, particularly our older members.”

Ms Shortt said the Government had failed to help the oldest and poorest with his Spring Budget, putting millions at risk of poverty, illness and even homelessness.

She added: “The decisions that older people often have to make – they can have the heating on for another hour or make themselves something hot, they can’t do both.

“It’s incredible to think that in the 21st century older people and others on low incomes are forced to make that decision. It’s not right. It’s the 21st century, we’re in the sixth richest country in the world, and we’ve got people having to make those decisions.”

She continued: “People are having to cut down on nutritional meals, and malnutrition is now on the rise. Their decision may be that they have to keep the heating on so they don’t get hypothermia, and the only thing they can cut out is their food.”

Ms Shortt added: “We’ve got a government that has no idea what it’s like to live on a fixed-term income.”

Groups representing older people are calling for the Government to take drastic measures to support pensioners, including re-introducing the triple lock with immediate effect and raising the state pension to help older people in the face of a bleak outlook for the coming years.

Mr Reed said: “The basic state pension in this country should be sufficient to pay for the average energy costs of a house and also allow enough for people to buy food and clothing and so on. And it doesn’t.”

DON’T MISS:
French election debate LIVE: Le Pen silences Macron with plan [LIVE]
Prince Harry has adorable exchange with baby at Invictus Games [LATEST]
Pension blind spots cost Britons average of £120,000 in retirement [INSIGHT]

He added that the Government had to register that there has been a “paradigm shift” in energy prices and create support measures for older and vulnerable people in response.

He said: “I think we have to accept that there’s been a paradigm shift in energy prices, because we’re now at a completely different level and, as the research says, it’s going to stay there.

“I think once prices go up they stay up. And I see no changes coming to the energy market which are going to make sure that prices drop significantly. If anything, they’re gonna keep going up.

“Governments have got to calculate into the benefits and pension system that paradigm shift. There’s got to be a paradigm shift in those as well in order to enable people to survive.

“They’ve got to actually form a safety net and pension system which reflects that step change, and that’s what they’re not doing.”

He added: “I think the Government has got to start to recognise that because of this huge shift, this real step change in the basic essentials of life, they’ve got to make the pension and benefit system match that step change, which means significant increases on the basic state pension and making sure that benefits are inflation proof.

“Benefits are supposed to provide people with a very basic safety net. Well, if that safety net is only going up by 3 percent and inflation is going up by 8 percent, then basically they’re saying that safety net has got a huge holes in now. It’s not a safety net anymore.

“All those people who survive on benefits are basically being sent further into poverty. And that’s the cruel reality of it.”

Source: Read Full Article