Gas giant’s profits spark fuel campaigners’ anger
PUBLISHED: 08:49 28 February 2013 | UPDATED: 10:07 28 February 2013
Supporters of a campaign to help the elderly with their fuel bills have hit out at British Gas after its parent company announced profits of £606m following price rises.
The importance of the EDP-backed campaign, Surviving Winter, was made abundantly clear yesterday with Centrica revealing an 11pc rise in profits, after increasing energy tariffs by 6pc at the end of last year.
The company made a profit of £50 per household prompting calls for the firm to use some of the cash to reduce energy bills for its 8.4 million customers.
Last year’s cold weather saw gas use leap 12pc and Sian Callaghan, director of regional corporate affairs for Centrica and British Gas, said the company could not promise that bills would not rise in the future.
She said: “What we have got to recognise is that the era of cheap energy is over. We are now having to import a large proportion of our gas and upgrade the National Grid in order to keep the lights on, while old coal power stations have to be switched off.
“We will try to soften the impact on customers by helping them with energy efficiency, so if prices rise, then bills do not have to because people are more energy efficient in their homes.”
Bishop of Norwich, the Right Rev Graham James, pictured, who supports Age UK’s Surviving Winter appeal, said British Gas’ profits were a “stark reminder” of the need for the campaign.
He said: “While British Gas has sought to help some people with insulation and other assistance, there remain many older people who find a choice has to be made between fuel and food.”
The Bishop thanked everyone who had donated to the Surviving Winter appeal saying the response in Norfolk had been “better than ever” this year.
Archdeacon of Norwich, the Venerable Jan McFarlane, said: “We know that British Gas will say that they need to make these kinds of profits in order to invest in sustainable energy sources for the future, but the figures seem hard to justify when prices were increased in November, just as we began a long and severe winter.
“There will be many who will have concluded they can’t afford to stay warm, and the consequences can be serious for the elderly and the infirm. That’s why the Surviving Winter Campaign is so important and why every donation counts.”
On Monday, British Gas announced it would create 1,000 extra jobs and Norwich North MP Chloe Smith said that although she understood how tough it was for consumers to pay bills, profits being used to create jobs was a positive step.
Centrica also confirmed yesterday that British Gas boss Phil Bentley would quit at the end of June –and will leave with a combined share, salary and pension package worth around £10m.
Trade union Unite said the energy regulator should be given more power to ensure utility providers “behave fairly”.
Len McCluskey, Unite general secretary, said: “These profits will anger a growing number of families who are struggling to pay the bills.
“The price increases in November caused hardship for customers while British Gas bosses boosted their profits and their own bonuses in the process.”
Underlying earnings at the wider Centrica group jumped 14pc to £2.7bn, but Centrica said it paid more than £1bn in tax and invested £2.7bn in 2012.
Chief executive Sam Laidlaw insisted the company needed to make a “fair and reasonable return so that we can continue to make our contribution to society and to invest”.
Shadow energy and climate change secretary Caroline Flint said it was time for a “complete overhaul of our energy market”.
“People will not understand why, just a few months ago, British Gas claimed they had no option but to put up their prices when now it looks like they’re making huge profits on the back of spiralling bills for hard-pressed consumers,” she said.
To apply for help from the Surviving Winter fund, call Age UK Norfolk on 01603 787111. To apply for assistance from the Warm and Well fund, call the Norfolk Community Foundation on 01603 623958.