As spiralling bills push more households to the brink, Citizens Advice has revealed that people are in the dark about almost £2bn of available financial support.

Citizens Advice argues that suppliers and the government all have a part to play in ensuring social tariffs are proactively offered to people who need them most. It further states the government could take an immediate step to improve the support available through existing social tariff schemes without spending a penny by putting the onus on suppliers ensuring people eligible for social tariffs are rightfully receiving them.

The lack of consistency, sufficiency, and promotion of schemes creates an unfair postcode lottery in which identical households receive completely different levels of support, simply because of where they live. And with £1.9bn sitting unclaimed in social tariffs across water and broadband, a low-income household could miss out on saving at least £350 every year.

Is there a growing need for help?

In a new report, Citizens Advice found half of GB adults (25 million) cut back their spending on essential bills, such as water, broadband, car insurance, and energy, in the last year.

With utility bills only expected to increase further over the coming years, research by one of Citizens Advice’s partners, the Institute for Public Policy Research (IPPR), has found that growing numbers of households will spend a disproportionate amount of their money on essentials.

The IPPR found an estimated 2.8m households are expected to spend a fifth or more of their disposable income on water, energy, and broadband costs over the next 12 months. That’s 1 million more households since 2021-22.

Is it time to end the postcode lottery of support?

Citizens Advice is warning that in their current form, badly designed social tariffs with patchwork support available in different areas are falling short of the mark in keeping people connected to essential services.

This needs to change as more people feel the pinch, according to the charity, as it argues there are steps the government can take now to improve the support currently available through existing social tariff schemes. These include:

  • Ensuring suppliers proactively offer social tariffs to their low-income customers, aided by better data-sharing between government departments and suppliers
  • Ending the postcode lottery for water and broadband social tariffs, so that the support available to people doesn’t depend on where they live and is consistent across markets, bringing it in line with other schemes like energy
  • But in the long term, the charity wants to see a broader commitment to improving social tariffs across a wider range of markets, including car insurance, to shield those on low incomes from increasingly unaffordable essentials.

Frontline staff at Citizens Advice say there are people in need of support who have no idea that social tariff schemes even exist, and even those who are aware encounter difficulties accessing them. But, when designed effectively, social tariffs provide much-needed relief to people’s already stretched budgets.

Dame Clare Moriarty, Chief Executive of Citizens Advice, 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.