More than 100,000 people across the UK have vowed to cancel their direct debit payments for gas and electricity in a protest over prices.
Don't Pay UK is an activist group that wants everyone's bills reduced to an affordable level, and have pledged for the bill black-out to begin on October 1 2022 if things do not change, Birmingham Live reports. The movement has been gaining traction in the wake of the cost of living crisis, as the price cap is set to reach an estimated £3,358 annually.
Many households have said they are unable to afford the new prices, and will plan to cancel their direct debits in the same month energy bills are increased. The Don't Pay UK website says: "Even if a fraction of those of us who are paying by direct debit stop our payments, it will be enough to put energy companies in serious trouble, and they know this. We want to bring them to the table and force them to end this crisis."
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As MoneySavingExpert Martin Lewis urges the Government to make changes, business comparison experts have told consumers to look into their rights if they choose to stop paying.
Les Roberts, content manager at Bionic, has provided some insight into the rights of a household who are considering axing their payments. Les said: "Your energy provider does have the right to take action if you stop paying your direct debit and begin to rack up debt.
"They could potentially move you on to a prepayment meter, which means you would most likely be paying a higher rate. A prepayment meter requires you to pay for energy as you use it.
"However, you do have some rights as a consumer before this happens. Your supplier has to give you at least 28 days to repay your debt before they take action. They cannot enter your home and install a prepayment meter without at least seven days' prior warning.
"Your supplier should offer you a repayment plan or help you to arrange repayment through your state benefits before they install a prepayment meter. You can also refuse a prepayment meter if you are unable to physically reach your meter or top up the balance at a shop. For example, if you are disabled or ill or live very remotely.
"Do note that if all the above conditions are met and you still refuse to pay, your supplier does have the right to gain a warrant to enter your home and install the meter or they could change your smart meter setting to a pay-as-you-go set up."
Les also looked into the consequences of refusing to pay one company, then moving on to another in the future. The expert said: "You also need to be aware that not paying your energy bills can have a negative impact on your credit score, which could make it harder to borrow money in the future.
"Although you pay for your energy as you use it (this is the case for both domestic prepayment and credit meters) credit reference agencies can be notified for non-payment of utility bills. Your supplier could pass your account onto a debt recovery service, and you may even be hit with a County Court Judgement (CCJ).
"Even if you then repay the debt, a record of a CCJ will stay on your credit file for six years and can make it harder to borrow money."
When asked if households can switch providers if the individual is in debt, Les had some positive words for readers.
He continued: "As prices skyrocket you may decide to shop around for the best deal, using a comparison website. It is important to be aware that if you have been in debt with your current provider for more than 28 days your switch might be blocked. But your supplier can’t stop you from switching if it's their fault you're in debt.
"If you have a prepayment meter, you can switch if you're in debt, so long as the amount you owe is £500 or less per fuel. In this instance, The supplier you switch to will take on the debt and you will repay them instead."
Les also discussed the decision energy providers make if their customers refuse to pay. He said: "If you can't agree a repayment plan with your supplier and refuse to have a prepayment meter installed, then your supplier can begin steps to disconnect your supply."
Your supplier can disconnect your supply in the following circumstances:
- If you haven’t come to a repayment agreement and refuse to have a prepayment meter installed without a valid reason (for example, an illness or disability stops you from accessing, reading, or using the meter).
- If you do arrange a repayment plan but miss an instalment, your supplier can start action that could lead to disconnection after 28 working days from the date you missed the payment.
- If you haven’t paid after 28 days from the date of your bill, your supplier can start putting the wheels in motion to disconnect your supply.
Les added: "Disconnection can only be considered when all other options have been exhausted and both gas and electricity suppliers must give you seven days' notice before they do it.
"Ofgem has stated that suppliers should do everything in their power to avoid disconnecting your supply especially if you are ill or disabled and they are not allowed to disconnect the supply of a person who is above the state pension age or lives alone between the colder months of October to April."
The expert also discussed the possibility that consumers may already be paying too much for energy in the first place. He concluded: "Ofgem has ordered a review as the watchdog found sevn million households currently on a Standard Variable Tariff experienced a bill increase of over 60 per cent between February and April this year.
"The regulator found that the firms Ecotricity, Good Energy, Green Energy UK, TruEnergy and Utilita Energy were potentially calculating bills inconsistently. If your supplier is one of these companies you should contact them about a possible rebate.
"Remember the best action to take is to compare different suppliers for the best deal using a comparison service."
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