Gas and electricity arrears-what to do
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Gas and electricity arrears-what to do

Last Updated: Sunday 17th March, 2013

Gas and electricity arrears

These arrears are classed as priority debts due to the fact that you can be disconnected for non-payment. Although being disconnected is measure of last resort it still may happen if you ignore your responsibilities. So if you are having difficulties making payments your first port call should be to contact your energy provider and explain your situation.

First thing you should do is establish the accuracy of the bill. If the bill is an estimate supply the company with the accurate figures from the meter. Also make sure, if you have recently moved house, that the outstanding debt has been incurred by you. It may be the case that the previous owners have not settled their account with the energy company.

In some instances the energy company may have made a mistake, confusing an outstanding credit agreement, eg a washing machine , with an outstanding utility bill. You cannot get your get your energy cut off for failing to pay a consumer credit agreement so make sure that your debt to the company is not for something other than fuel.

Once the above has been established you should then make arrangements to pay. The payments must cover the fuel you are currently using and contribute towards lowering your arrears. The amount of money you pay towards your arrears is negotiable and is based upon what you can afford. This can be calculated using our Statement of Affairs form and should be presented to your energy provider as evidence of your income and expenditure. Should the company not accept this you should start making payments in any case as the energy companies have to comply with their code of practice which states that they must accept offers of payment at an affordable level.

Make arrangements to pay

There are various ways to pay your energy bills and arrears, some more expensive than others. The providers should accept one of the following forms of payment rather than cutting you off.

Direct debits

Perhaps the cheapest form of paying your energy bills and favoured by the providers, as they offer discounts using this method of payment.

Installments

This is where you have made an arrangement to pay your energy bill weekly, fortnightly or monthly before the next bill is due.

Budget plan

Your fuel company will calculate how much fuel you use over a year and then add the arrears. You will then pay a set amount either weekly, fortnightly or monthly. If you cannot afford to pay the amount being asked you can ask for a special arrangement to be considered. The energy supplier, under their code of practice, should accept a rate of payment which is based on your usage and circumstances. This may mean that the energy companies may have to accept a payment plan of more than a year.

Pre-payment meter

Arrangements can be made to have a pre-payment meter installed where you can pay, in advance, for the fuel plus an affordable amount towards the arrears. Pre-payments meters cards are readily available and can be topped up at local shops and Post Offices.

The downside of this type of payment is that the standing charges are higher and if you can't afford to top them up you are being effectively disconnected.

Fuel Direct/ Direct Payments

You can ask for weekly deductions to be taken from your benefits and paid directly to the energy company if you are on Job Seekers Allowance or Income Support. The deductions will cover the fuel you use and a contribution to paying off your arrears.

Having trouble paying your utility bills is symptomatic of a deeper problem with balancing your finances. You may well be stretched financially in other areas too, high credit card bills, trouble meeting your rent or mortgages payments. Don't ignore any of these problems as this will only make matters worse; there is no problem unsolvable!

For information about mortgage arrears read this article.

Written by George


 



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