Households who don’t pay energy bills by direct debit face £254 stealth hit

Households have been hit by a new ‘sinister’ charge on their utility bills – just weeks after The Mail on Sunday exposed a separate stealth tax worth billions.

The latest hidden fine is estimated to cost five million households that don’t pay by direct debit up to £254 a year on top of their regular bill.

They are ‘default credit’ customers who pay by cash, check or over the phone – and paying in this way was subject to an additional charge, capped at £84 per year until 2021.

But that has risen to a maximum of £254 a year. Regulator Ofgem blamed an algorithm that calculates the figure and the huge rise in energy prices.

Adam Scorer, from the National Energy Action charity, said: ‘How can an elderly couple who always pay their bills on time end up paying an extra £20 a month just because they want to pay in cash?’

The levy will disproportionately affect pensioners.

Research for energy supplier Octopus shows that almost a third of people who pay by cash or check are over the age of 65.

And 75 percent of those who pay using the traditional method think they’ll be charged the same or less than someone who pays by direct debit.

Octopus said it had refused to pass on the full surcharge to its customers, leaving the fee at £80. It added: ‘Suppliers do incur additional charges for other payment methods, but this surcharge has gotten out of hand and we are asking Ofgem to review it urgently.’

Two weeks ago, the MoS revealed that the costs of bailing out failed energy suppliers were being quietly passed on through the ‘fixed costs’. This has risen by 50 per cent over the past year, costing bill payers around £273 each.

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