By Yuri Prasad
Downloading PDF. Please wait... Issue 2794

Energy bills set to soar as fat cats rake it in

The poorest people will be pushed to the edge with the war in Ukraine accelerating energy costs.
Issue 2794
Protester holds sign criticising cuts to champagne tax as energy costs rise

Protester opposes the rising cost of living and increasing levels of inequality and poverty. (Alisdare Hickson)

The cost of living crisis took a new turn this week as fuel firms said the war in Ukraine could drive prices even higher than predicted.

Filthy rich energy companies are already writing to millions of people to tell them that average home energy bills could soar to as much as £2,000 a year from April—a rise of 54 percent. Energy analysts now warn the war is raising wholesale fuel prices and could send household bills rocketing by a further £1,000 a year.

The threat of rising bills is already spreading fear among people on low incomes. Jane, a pensioner in east London, told Socialist Worker she is already turning off her heating—despite feeling the cold. “My supplier said my bills would rise £200 a year. That’s a lot of money to me,” she said. “I’m already turning the heating off when the sun comes out and wearing an extra layer of clothing. But I find it very disheartening when I hear of the energy company’s profits going up. It makes you feel unimportant.”

Jane is right to be angry. This week Centrica, the firm that owns British Gas, announced that its operating profits rose by 112 percent to £948 million in 2021. And its bosses are laughing all the way to the bank.

“We were both surprised and not surprised by what we woke up to this morning. This is absolutely unprecedented,” gloated Chris O’Shea, Centrica’s chief executive. But for nine million low income families, there’s no such “good news”. After below-inflation increases in Universal Credit and other benefits they will be £500 a year worse off. Pensioner couples will lose £540 a year.

The Joseph Rowntree Foundation noted that the government used an inflation figure of just 3.1 percent when calculating benefit rate rises. The Retail Price Index rate of inflation is now 7.8 percent and is ­predicted to rise still further.

The losses come just months after the £1,000 a year cut to households on Universal Credit when the £20 a week Covid top-up was axed.

Soaring bills are not the only part of the cost of living crisis.

Average yearly pay rises last year were just 2.1 percent in the ­private sector and just 1.5 percent in the public sector, according to the Labour Research Department. The government is again planning below inflation pay rises for millions of workers. It announced last week that NHS staff would be offered just three percent, while others could face even lower “rises”. And the Tories are looking to claw in still more money by hitting ­students too.

Students in England will have to pay back university loans over 40 years instead of 30 under “reforms” designed to save the treasury billions of pounds. Extending the repayment period will mean the majority of lower and middle income earners will keep paying for more years, increasing their debt by thousands of pounds. They could still be repaying their loans up to their retirement. But the highest earners, those that can clear their debt within 30 years, won’t be impacted at all.

Trade union leaders ought to meet the daily drip feed of attacks on working class living standards with a wave of fury. But so far all we are getting from most are strongly worded press releases. That makes every small scale strike for better pay even more important. The more we can show anger from below, the more pressure we can put on those above.


  • The People’s Assembly has called a series of cost of living local protests for this Saturday, 5 March. Go to thepeoplesassembly.org.uk 

Sign up for our daily email update ‘Breakfast in Red’

Latest News

Make a donation to Socialist Worker

Help fund the resistance
One-off