Increase in state pensions ‘woefully insufficient’, says expert
New research published on Wednesday found that energy prices in Britain are set to remain significantly above average until 2030. The analysis has raised concerns that the most vulnerable people in society, including older people on fixed incomes, will face impossible decisions to survive.
Cornwall Insight analysis has shown that energy prices will remain above £100/MWh per year for the next decade and possibly beyond. The highs are well above the previous five-year pre-2021 average of £50/MWh in winter and even lower pre-2021 summer prices.
Although forecasters are predicting that prices could temporarily dip from all-time highs seen in recent months, they will remain elevated and likely rise beyond record highs seen in the coming years.
Tom Edwards, Principal Modeller at Cornwall Insight, said: “While we are used to seeing headlines depicting energy prices at an all-time high, unfortunately, as prices head lower our modeling shows that prices from before 2021 are not making a comeback this decade and likely beyond.
“The EU’s growing demand for non-Russian gas has pushed up gas prices around the world, and these higher prices have increased the costs of generating electricity, with gas expected to remain the marginal source of fuel to generate electricity for the remainder of the 2020s.
“With all of Britain’s coal capacity due to close by April 2024 and many nuclear power stations coming to the end of their life, high electricity prices will continue to affect consumer bills.”
The latest news has sparked widespread concern that Britons currently struggling with an unprecedented cost of living crisis, including massive fuel bills, rising food prices and record inflation, will not be able to cope.
Activist groups representing the elderly are particularly concerned that pensioners on fixed incomes will be left with no options on how to support themselves unless the government takes drastic measures to support them.
Dennis Reed, director of Silver Voices, told Express.co.uk that millions of older and vulnerable people have “past the point” where they can use “money saving tricks” to get by and were forced to give up basic necessities.
He said: “Last year everyone was offering advice on how to cut costs. This was before the recent rise in fuel and oil prices. And people could barely get by before, let alone now.
“The stark reality is that millions of people, especially older people on fixed incomes, cannot afford the bare necessities of life.
Retirees are facing the “brutal reality” of the cost of living crisis.
Skyrocketing fuel prices, rising food prices and record inflation have left many struggling to survive.
“It’s all very well to say that you have to choose between heating and eating, but it’s a decision that people sometimes cannot make. It’s not just about reducing fuel consumption a bit, many people have already turned off their heating and they don’t turn it on again.
“A lot of people have given up on their TVs because they can’t afford to buy TV licenses and they don’t want to break the law, and they can’t afford to buy TVs. proper food.”
He added: “It impacts every aspect of their lives. Because all kinds of luxuries that they might have had like going out or going to the movies or having a meal out once a month or something like that, they’re all gone and there’s nothing left to cut.
Jan Shortt, general secretary of the National Pensioners Convention (NPC), said older Britons were already facing impossible choices.
She told Express.co.uk: “People need to remember that many retired people are on fixed incomes. When you’re on a fixed income, there’s not much wiggle room. It only takes one thing to increase and then you are in the business of making decisions on how you allocate the money you have.
“Most people survive on £10,000 a year or less. It is a very limited income. So anything that goes up in price, you have to sit down and budget.
Ms Shortt said recent changes such as the Government’s suspension of the triple-locked pension commitment in September and the decision to scrap the free-to-air TV license for the over-75s, along with record inflation and rising food prices were taking their toll.
She said: “All of these things are impacting those on fixed incomes, so it’s absolutely devastating for people, especially our older members.”
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Groups are calling on the government to take urgent action to help support older people.
Ms Shortt said the government had failed to help the oldest and poorest with its spring budget, putting millions at risk of poverty, disease and even homelessness.
She added: ‘The decisions that older people often have to make – they can turn on the heating for an extra hour or cook something hot, they can’t do both.
“It’s amazing to think that in the 21st century, seniors and low-income people are forced to make this decision. It’s not true. It’s the 21st century, we’re in the sixth richest country in the world, and we have people who have to make these decisions.
She continued: “People have to reduce their nutritional meals and malnutrition is now on the rise. Their decision may be that they need to keep the heating on so they don’t get hypothermic, and the only thing they can cut is their food.
Ms Shortt added: ‘We have a government that has no idea what it’s like to live on a fixed income.
Groups representing older people are calling on the government to take drastic action to support pensioners, including reintroducing the triple lockdown with immediate effect and increasing the state pension to help older people face bleak prospects for years to come. to come.
Mr Reed said: ‘The basic state pension in this country should be enough to pay the average energy costs of a house and also allow people to buy food and clothes etc. And it is not.
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Energy bills are expected to remain well above average for the next decade.
He added that the government needed to register that there had been a “paradigm shift” in energy prices and create support measures for the elderly and vulnerable in response.
He said: “I think we have to accept that there has been a paradigm shift in energy prices because we are now on a completely different level and as the research says it is going to stay there. .
“I think once prices go up, they stay high. And I don’t see any changes coming to the energy market that will cause prices to come down significantly. If anything, they’ll keep going up.
“Governments need to integrate this paradigm shift into the benefit and pension system. There has to be a paradigm shift in those too in order for people to survive.
“They actually need to form a safety net and a pension system that reflects this dramatic change, and they’re not doing that.”
He added: ‘I think the government has to start recognizing that because of this huge change, this real sea change in the basics of life, it has to make the pension and benefits system match this radical change, which means significant increases in the basic state pension and ensuring that benefits are inflation-proof.
“The benefits are supposed to provide people with a very basic safety net. Well, if that safety net only goes up 3% and inflation goes up 8%, then basically they say the safety net has huge holes now. It is no longer a safety net.
“All these people who survive on benefits are basically sent further into poverty. And that’s the cruel reality of it.