Vulnerable households missing out on £350 of support to pay essential bills

A 'postcode lottery' of social tariffs is leaving households missing out on almost £2bn worth of support to pay their bills, with families potentially missing out on at least £350 yearly, according to a report

A report has revealed a "postcode lottery" of social tariffs, leaving households out of pocket by nearly £2bn in essential bill support.

Citizens Advice discovered that identical households get "completely different" levels of support based on their location due to inconsistent promotion and availability of social tariffs from suppliers. The charity highlighted the inadequacy of poorly designed social tariffs with "patchwork" support across various areas, failing to keep people connected to vital services.

They pointed out that a low-income household could miss out on at least £350 a year in savings, with £1.9bn unclaimed in water and broadband schemes alone. Citizens Advice urged the Government to take "immediate" action that wouldn't cost anything, by mandating suppliers to proactively offer social tariffs to low-income customers, supported by improved data sharing between government departments and companies.

The organisation also demanded an end to the postcode lottery for water and broadband social tariffs, advocating for uniformity across markets similar to other schemes like energy. Additionally, Citizens Advice found that half of British adults around 25 million people have reduced their spending on essential bills such as water, broadband, car insurance, and energy over the past year.

A startling number of Brits, almost one in seven, confess they've slashed their spending, causing disruptions to their lives. Some people have even resorted to ditching home internet for public WiFi or axing car insurance, which hampers their ability to commute.

Looking ahead, some 2.8 million UK households could end up shelling out a fifth or more of their take-home pay on utilities like water, energy and broadband over the coming year. This forecast represents a steep 27% rise since the prior financial term, according to the Institute for Public Policy Research (IPPR).

Citizens Advice said its frontline staff reported that many in need of support had no idea that social tariff schemes even existed, while those who were aware had encountered difficulties accessing them. One Citizens Advice adviser from Dover, Deal and District, said: “One of the water companies in our area has social tariffs, and you can also apply for extra financial support.

“But you have to really jump through some high hoops for the social tariff. It’s not something that any of my clients have ever been able to do without help. They have needed me to put in the application, to do the legwork, but they’re the lucky ones that have that support.”

Citizens Advice chief executive Dame Clare Moriarty said: “Worrying numbers of people continue to be forced to take drastic measures, like cutting back their spending on water and energy, in the face of unmanageable essential costs. Social tariffs have a crucial role to play in shielding low-income households from unaffordable bills. But, for too long, people have been in the dark about extra financial support available to them, which could ultimately affect if someone keeps warm, or falls into debt on their water bill.

“Solutions to this are hiding in plain sight. Putting money back into the pockets of people who need it most starts with the government ending unfair postcode lotteries in social tariffs and putting the onus on suppliers to ensure that people are getting the help they’re entitled to.”

Henry Parkes, principal economist at the IPPR, said: “Growing numbers of households are spending inordinate amounts on the essentials, highlighting that although inflation may have slowed, higher prices are here to stay, with those on the lowest-incomes squeezed the most. Alongside other bold policy action, effective social tariffs could make a real difference in tackling this crisis in living standards.”

Yonder surveyed 2,093 British adults between June 24-25.