Details of £400 energy payment to households revealed

The government has announced how all households in England, Scotland and Wales will receive £400 to help with rising fuel bills this autumn.

The money, part of the Energy Bill Support Scheme, will be paid in six instalments.

Households will see a discount of £66 applied to their energy bills in October and November, and £67 a month from December to March 2023.

But how the money is received will depend on how you pay your bill.

Customers paying by direct debit, either monthly or quarterly, will see an automatic deduction off those bills.

Those with “smart” prepayment devices will see an automatic monthly top-up added to their account, meaning they will have to add less credit to their meter for the total energy they use.

But those with older “non-smart” prepayment devices will not get this money automatically.

Instead, they will receive an energy bill discount voucher in the first week of each month, via text, email or in the post. Customers will have to redeem these in person at their usual top-up point, such as a local Post Office.

“While no government can control global gas prices, we have a responsibility to step in where we can and this significant £400 discount on energy bills we’re providing will go some way to help millions of families over the colder months,” said Business Secretary Kwasi Kwarteng.

More than four million households use prepayment meters in Britain, according to the energy regulator Ofgem. Less than half of those meters – 1.9 million – are smart devices that will allow this payment to be made quickly and easily.

Charities are concerned that for the more than two million households with traditional non-smart prepayment devices – often the most vulnerable and poor in society – this energy help will be harder to access.

Pre-payment meters are often installed by suppliers in homes that have fallen into debt, although some people may opt for a meter to help them budget better.

In addition, landlords often install them in rental properties to ensure tenants do not leave without paying their energy bills.

One person on a non-smart prepayment meter is Winston Carrington, a grandfather in his 70s, from Manchester.

Mr Carrington, who previously told the BBC he was growing vegetables in his garden to help ease the impact of the rising cost of living, said he was now spending £5 a day on energy.

“I’m paying four times the amount I was paying this time last year,” he said.

“I don’t know what I’m going to do… when it gets really cold. Food [price] has not even come into the equation.”

The pensioner said he was already trying to save as much energy as possible by turning off “every single appliance” when he leaves his home.

Mr Carrington said he was “grateful” for the £400 energy bill discount but was concerned how he might receive his voucher, given the prevalence of scam text messages.

National Energy Action (NEA) is calling on the government to ensure households know support is coming.

“We don’t want people to miss out on vouchers that could keep them warm in the coldest months of the year,” said NEA’s head of policy Matt Copeland.

“And additional support must be given to those households that will miss out on the £400, just because they don’t pay an electricity bill directly.”

The £400 payment will apply directly to households in England, Scotland and Wales.

The Treasury is still in discussion with Stormont ministers about how to make the payment to Northern Ireland households.

Northern Ireland is a separately regulated energy market. The situation is further complicated because NI’s power sharing government is not fully operating and cannot make new spending decisions.

All households are eligible for the full £400, regardless of income or size of house.

“This is just one small part of a wider package of measures. The problem is that there are many people who are not on means-tested benefits or just above benefit level who are still really struggling with really high bills, so we thought this was the fairest and easiest way to distribute the money,” said Lord Callanan, Minister for Business and Energy.

The government hopes all households will engage with the scheme and issued a reminder that no household will be asked for their bank details, to protect them against fraud.

But this will require a big push to ensure that those who need it the most do cash in their vouchers.

“If you do have a prepayment meter, look out for post from your supplier, it might contain hundreds of pounds worth of vouchers,” advised Matt Copeland from the NEA.

“And if you know someone who has a prepayment meter, let them know it’s coming this winter because it could be really important to help them stay warm.”

How have you been affected by rising energy prices? What difference would the discount make to you? Email haveyoursay@bbc.co.uk.

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