British gas email about the £400 govn money

wrf12345

Just had an email from BG, thought it was bad news re attempt to raise s/c but actually explaining how the monthly donations for direct debit users work. £66 or £67 a month and if your s/c is above £67 then they put the money into your bank rather than keeping it in the account, which is strangely generous of them.

If your s/c is less than £67 then they will spilt it so that it covers the s/c and the excess goes into your bank account and the s/c is not taken out. Edit - read that wrong they take the s/c and then give you the same amount back to your bank, the excess staying in the account!

If paying by cheque it stays in the acc, anyway.

Swipe

Crazy system, it should really all stay in the account as credit

[Deleted User]

Swipe said:

Crazy system, it should really all stay in the account as credit

Can you imagine the work and costs involving in re-assessing annual costs for millions of customers; deducting the £400 and then re-assessing monthly payments? Customer services would be overwhelmed with enquiries.

The way it is being done negates this requirement: moreover, it is possible that the new PM might yet remove the £400 in favour of another cunning scheme.

wrf12345

I doubt the £400 will be dropped, the time factor means any help will come later than October, other than getting rid of vat and green energy taxes. Personally, would like to see the standing charges dropped and have a lower rate for the first £20 of gas and electric use each month, whilst the market would decide the higher rates (some govn money to help, phased out over time) - this would then focus the minds of consumers to use radically less energy. From April next year just to give the companies time to make back the money they previously lost.

Bear in mind you have a situation where companies are allowed to make three percent return but their turnover is going to have a huge increase due to increased energy costs, so they will be raking it in like never before with huge increases in executive salaries, etc.

MattMattMattUK

wrf12345 said:

I doubt the £400 will be dropped, the time factor means any help will come later than October, other than getting rid of vat and green energy taxes. Personally, would like to see the standing charges dropped and have a lower rate for the first £20 of gas and electric use each month, whilst the market would decide the higher rates (some govn money to help, phased out over time) - this would then focus the minds of consumers to use radically less energy. From April next year just to give the companies time to make back the money they previously lost.

People will cut back regardless of the cost, making average and high uses subsidise low users will not magically make people cut back more. I get it, you want other people to subsidise you, but at least be honest about that, rather than attempting to put flowers on it by claiming it will magically change usage patterns.

wrf12345 said:

Bear in mind you have a situation where companies are allowed to make three percent return but their turnover is going to have a huge increase due to increased energy costs, so they will be raking it in like never before with huge increases in executive salaries, etc.

It is currently 2.0% maximum and depending on input prices we could well see them making nothing again, or even losing money over the winter on those customers are are on the SVR. Fixes usually have a slightly higher margin due to buying futures and so being able to hedge, but very few households have fixed at the moment. The suppliers are not "raking it in", they will be happy with break even over the next twelve months and the government will be happy if the zombie corpse of Bulb only costs another £2 billion between now and the end of March. 

Troytempest

So, most of us will get £66 per month back in our bank account. Surely any sensible person will just send it straight back to energy account as a manual credit.

MattMattMattUK

Troytempest said:

So, most of us will get £66 per month back in our bank account. Surely any sensible person will just send it straight back to energy account as a manual credit.

Many on here, including myself, have already increased our Direct Debits to the level they need to be at, accounting for the now expected October price rise in the SVR, or based on their usage and their current fix, the £400/£66 will go into our bank accounts to be used however we wish, but the energy bills have already been budgeted for. 

brewerdave

Troytempest said:

So, most of us will get £66 per month back in our bank account. Surely any sensible person will just send it straight back to energy account as a manual credit.

Unless you have separate suppliers for gas/elec. In my case, the way BG are proposing is useful as I really need the help for gas in the Winter ,so the payment from BG will allow me to make a top up for my gas account -with EDF !

pochase

If people are already on the correct direct debit amount, they will not need the money in their energy account. So it makes sense to just pay it back, This way the cost is reduced and no monthly new direct debit calculations with fights with the customers need to be done.

It would be a good plan to put the money aside for those who are not on a sufficient DD, for example those who did not want to see reality and fought a few months ago to reduce the suggested DDs.

Elisheba

pochase said:

It would be a good plan to put the money aside for those who are not on a sufficient DD, for example those who did not want to see reality and fought a few months ago to reduce the suggested DDs.

I wouldn't say I fought with reality  .  My energy company suggested I put my DD up to £120 from £38 when my fixed tariff ended.  I did some sums based on February's usage and the new tariffs and put it up to £85.  I've not used more than £65 a month worth since, so have an account in credit and a new suggested DD of £61, which I am also ignoring.  I'll do the same come the October price hikes and I imagine I won't need to put it up to more than £100 but we will see. I am very frugal with heating in winter!

I will be using the £400 towards energy though, one way or another, even if it means putting it aside until its needed.

pochase

If you used £65 during summer and we have a 82% increase to be announced next week how can you believe £100 including (even very frugal heating) will be enough?

By January the current rates will have more than doubled. That would be £130 to £150 with no heating at all.