British Gas ‘should cut prices’

Consumers struggling with debt and faced with large energy bills should see more cuts, price comparison website uSwitch.com has argued.

The site was commenting in response to news that British Gas has seen a 33 per cent year-on-year rise in its upstream (gas and electricity provision) profits from £771 million to £1,023 million.

It more than cancelled out the 30 per cent decrease in operating profits from £742 million to £522 million.

According to British Gas, energy usage fell over the winter compared with a year ago but director of consumer policy at uSwitch Ann Robinson disagreed with their verdict on why this has been the case.

She said: "Affordability is already a huge concern and while British Gas has pointed to the mild winter weather as the reason why household consumption has fallen, our own research shows that people are turning down and switching off because of cost."

Ms Robinson said the profits indicate the recent cut in fuel bills was too small and urged providers to implement larger reductions.

"As Britain's biggest supplier it would be great to see British Gas take the lead," she remarked.

Figures by uSwitch have shown the firm's customers have seen their average bill soar in recent years from £543 a year in January 2004 to £1,002 in January 2007, with prices remaining above £1,000 in four of the five years since and now at £1,260.

Those whose incomes are squeezed by debt may be finding such an increase particularly hard to tackle and might wish to seek extra help.

The response by uSwitch to the British Gas figures echoes the way it reacted to recent news that EDF had also enjoyed improved profits.

On that occasion, Ms Robinson urged the company to "relieve the pressure" on its customers by reducing their bills by more than the figure announced last month.

By Joe White