Chris O’Shea, Chief Executive of Centrica, says energy prices at double the level of four years ago will pile on top of existing cost of living pressures
Households already stretched financially could struggle to pay energy bills this winter, the boss of British Gas’s parent firm has warned.
Chris O’Shea, Chief Executive of Centrica, says energy prices at double the level of four years ago will pile on top of existing cost of living pressures from today’s higher interest payments, council tax and food prices. Mr O’Shea, who was criticised for taking a £1.4million bonus package in March, added: “The idea of people not being able to afford their rent, their council tax, their food – its awful, it’s heartbreaking.”
The Government has discontinued last winter’s £67-a-month energy bill help for households. Mr O’Shea, chief of parent group Centrica, told the Mirror: “Energy costs have come down, which is good, but they are twice what they were four years ago. People consume two-thirds of their energy over the winter.
“Your payments can more than double, even if prices stay flat, if you pay when you get your bill. I am deeply worried about that. Those struggling with the cost of living are struggling with interest payments, with council tax payments, with food. It’s awful.”
While watchdog Ofgem has lowered its energy price cap during the year, the Tories have scrapped last winter’s £67-a-month bill help for households. And Ofgem is next week expected to announce the unit cap for 29 million households will rise by 5% in January, making an average annual bill £1,930.
Mr O’Shea, who in March accepted £1.4million in bonuses, said: “We’re seeing an increase in the number of people phoning, and how long they are on the phone because they need help. And there’s been an increase in the number of people falling behind with their payments, whether that’s missing payments or cancelling direct debits.
“I have been here for five years and the level of bad debt and direct debit cancellations is the worst I have seen.” Mr O’Shea’s comments follow the announcement in July that British Gas profits rose almost 900% to a record £969m in the first half of 2023.
The country’s biggest supplier, with 7.5 million customers, insisted the surge was due to a tweak to Ofgem’s price cap that allowed it and others to recoup some of the costs incurred during the energy crisis. But despite a likely loss in the second half of 2023, analysts still expect annual profits to surge from £72m to almost £800m.
Mr O’Shea hit back, saying of Ofgem’s price cap:“For every £1 that we get, we’re allowed to make 2p profit.” His £1.4m of bonuses was part of a package worth £4.5m last year. His salary alone is £790,000. He waived his annual bonus the previous year but said he had given “no thought at all” to whether he would for 2023.
British Gas was rocked by a prepayment meter scandal earlier this year. A Times story included allegations debt collectors broke into vulnerable customers’ homes to fit the meters. The firm paused the practice and Ofgem investigated.
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