What is Don't Pay UK and what happens if I cancel my energy bill payment? – This is Money

By Emilia Shovelin For This Is Money


Energy bills are a huge cause for concern in many households. Steeply rising bills are expected to hit new highs in the coming months, leaving millions in energy poverty before the end of the year.
This is because Ofgem’s price cap is expected to rise by approximately 50 per cent, meaning bills for the average household not on a fixed tariff could rise from £1,971 per year to a predicted £3,315 from October 2022.
As experts warn the price cap rise will have a ‘disastrous impact’ on the finances of millions of households, campaign group Don’t Pay UK is urging millions to join its energy boycott.
Bills strike: Don’t Pay UK is calling for one million Britons to cancel their energy direct debits in October to protest rising energy prices – but experts warn they could face repercussions
The campaign is calling for a mass energy bill strike and demanding a reduction in energy bills to an ‘affordable’ level.
It has not specified how much energy firms would need to reduce bills by in order to call off the strike. 
The movement has equated the potential strike to the national Poll Tax strike, which saw more than 17 million people refuse to pay the Poll Tax in the UK in the late 80s and early 90s.
Don’t Pay UK says it wants to hold energy firms accountable, with its website reading: ‘We want to bring them to the table and force them to end this crisis.’
The campaign is suggesting that, if 1 million people cancelled their direct debits, energy firms would lose out on £1.4 billion by the end of winter. 
It is currently trying to get one million people to sign up to the movement, and will then call on participants to cancel their direct debits on October 1.
The campaign has raised just under £10,000 in donations thus far, and is fast gaining support on social media channels, with its Twitter account boasting 62,000 followers and its Instagram account gathering more than 41,000. 
But being in debt to a utility company is a serious situation, and those considering joining the strike may be wondering what the implications might be. 
So how safe is it to join, and what are the repercussions of not paying your bills? 
This is Money spoke to leading solicitor, Paul Britton, of Britton and Time, and personal finance expert Julian House, at My Favourite Voucher Codes, on what you should know before signing up to the mass-payment strike in October.
Supply shortage: UK gas prices are still soaring after Russia began throttling off supplies to Europe, causing a global shortage as EU leaders scramble for supplies
Energy bills have been soaring since 2021. Wholesale gas prices began to rise steeply, resulting in 30 energy firms going bust, and the crisis was then worsened by the Russia-Ukraine war in early 2022. 
The Ofgem price cap, which is based on the price energy suppliers pay producers for electricity and gas, was increased by 54 per cent in April. 
Fuel costs are one of the main reasons UK inflation is higher now than at any point in the past 40 years, while millions are now predicted to be facing ‘fuel poverty’ come winter as households spend a higher proportion of income on their energy bills.
We explain everything you need to know about your energy bills here.    
House said: ‘With the likes of Shell raking in £7.3bn within the first three months of this year, and BP accumulating almost £5bn in the same period, there is little wonder a campaign aimed at boycotting energy bills is currently hot on the agenda.’
Centrica-owned British Gas, and Exxon Mobil, also recorded soaring profits recently, as BP’s profits tripled to £7bn partly as a result of the Ukraine war.
Unfortunately, there is no legal justification to withhold payment for your energy bills, unless your energy supplier has breached its contract with you. 
When you sign up to an energy provider, you will have signed a mutual contract with the terms of service set, which often include the option for suppliers to raise prices in line with Ofgem’s price caps.
Britton said: ‘We all have contracts with our utilities suppliers to provide us with gas, electricity, and water. 
‘There is generally a term in the contract which gives the utility provider the ability to increase the bill as energy and retail prices increase, unless of course you are on a fixed tariff. 
‘The advice to clients is that they should always check if any increase in price follows the terms of the contract. If not, you might be able to contest the increase.’
Ofgem originally produced a price cap on energy prices which is reviewed twice yearly, but this has increased to quarterly from October 2022. 
The cap only applies if you are on a default tariff, not if you are on a fixed-term energy tariff or a green energy tariff. If in doubt about your tariff, then you can contact your supplier to check. 
Given rapidly rising prices, most households are opting not to sign up to new fixed tariffs at the moment because they are not protected by the price cap and are therefore more expensive than a ‘default’ rate. 
Britton said: ‘Generally, if people are withholding payment of their bill despite having already received that service, then they will be breaching the contract. 
‘Unfortunately, there is no legal way to not pay a bill unless the utilities supplier has breached the contract themselves.’
Debt warning: If you withhold your energy bill in October, your energy supplier is likely to begin the debt collection process to recoup the money owed for your energy bills 
While experts say they sympathise with those suffering because of the energy crisis, they are urging customers to consider the legal implications if they participate in the mass payment strike come October.
House said: ‘I firmly believe in the power of the people, the influence that the many can have in affecting real societal change – but there are certainly legal ramifications that need to be considered here.’ 
Each energy firm will have its own process for dealing with missed or late payments, but those who cancel their payments should be prepared for the worst. This includes being pursued by debt collectors or having your electricity supply cut off.
Britton added: ‘It is likely that the energy companies will simply hold to their normal processes on late or missed payments if a small number of people are involved in the protest. 
‘Usually if you do not pay a bill within 28 days the supplier will likely contact you to inform you about the possibility of disconnecting your energy supply. 
‘Your energy supplier should offer to install a prepayment meter in the first instance. However, following this, if the debt remains unpaid, the supplier can apply for a warrant to enter your home to disconnect the supply. 
‘You will be sent a notice of the application to the court for the warrant and a hearing will take place. If the warrant is granted by the court, your supplier will be able to enter your home to disconnect the supply. 
‘They are required to give you seven days’ notice before they disconnect the supply so people could change their minds at the last minute and give in. 
‘Those with meters outside their properties should note that a warrant would not be required for their supply to be cut off, as the warrant is to enter the property.’ 
Britton added that without detailed knowledge of the cashflow and finances of individual energy firms, it was difficult to predict whether they would consider lowering their prices, and what debt collection measures would be put in place to deal with mass non-payment. 
Energy bills could hit £500 a month from January as experts predict steep rise in bills
He said: ‘It should be noted that the usual processes for debt collection could be significantly delayed if the energy firm has to deal with thousands of people with unpaid bills, as this will inevitably cause them a logistical problem. 
‘It is likely that energy companies may need to be in such dire situation that the viability of the company is in question before they consider price changes, and perhaps not even then. 
‘People should understand their own agreement with their energy company. That way they know when and how the energy firms may take action against them. If in doubt, seek independent legal advice.’
There are a number of ways that customers could be impacted if they withhold their payments in the mass-payment strike.
Britton said: ‘The best-case scenario is that the protest sparks a change in the law requiring energy firms to lower their prices.
‘The worst-case scenario is that many people could have their energy supply cut off – as winter approaches, this could be a serious danger to health and wellbeing of those who have decided not to pay and are left without heating and hot water.’
Britton also warned that a court judgement made against them for debt which will affect their credit rating; and that may need to pay extra costs such as the legal fees of the energy firm.
He said: ‘Consumers should review their agreement with their utilities suppliers to determine the specific process and consider the potential consequences. In some cases, this might be a county court judgment that could affect credit scores. 
‘Legally speaking, if you are consuming any amount of energy and subsequently not paying it, it will result in your account going into debt and increasing the likelihood of debt collectors to become involved – with the potential eventuality of being cut off completely from your provider.
Energy firms may cut off your electricity if you withhold your payment in October to take part in the Don’t Pay UK movement
Britton said that the protest carries significant risks, and it may not result in the change that households are desperate to see.
He said: ‘To protest in this way carries risk and could be costly to consumers, affect a consumer’s credit rating and potentially result in energy supplies being cut off. 
‘Energy companies have clear channels to recoup any losses once the protest is over, so this is unlikely to be an effective form of protest. 
‘Energy companies are likely to break before they bend. The most effective way to protest is to influence members of parliament instead, so change is forced on the energy companies. 
House added: ‘The hope of the campaign is to pressure the energy companies into lowering the price caps, and this would only work through mass non-compliance.
‘And even then, there is no guarantee this would budge the energy giants into submission. 
‘If you do accrue energy debts and are currently in receipt of benefits, it is worth checking out the Fuel Direct Scheme, as this may be a way you can assist with any debt you have amounted.’
The Energy Saving Trust has listed these ten tips, along with how much they could save a typical household could on energy and water costs per year. Read more on the energy saving tips here.
1. Switch appliances off standby: £55
2. Draught-proof gaps: £45
3. Turn off the lights: £20
4. Wash at 30 degrees and reduce use by one run a week: £28
5. Avoid using the tumble dryer: £60
6. Limit showers to four minutes: £70
7. Swap one bath a week for a shower: £12
8. Don’t overfill the kettle and fit a tap aerator: £36
9. Reduce your dishwasher use by one run a week: £14
10. Insulate your hot water cylinder: £35
Source: Energy Saving Trust, based on a typical three-bedroom, gas-heated home in Great Britain, using April 2022 price cap prices
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