Ofgem energy cap reduction will still leave millions in debt
Following Ofgem’s announcement of a 7% reduction in the energy price cap today, national debt help charity Christians Against Poverty (CAP) is welcoming the move, but warning that millions of households remain trapped in a cycle of energy debt and “deficit budgets.”
The reality for the thousands of people we serve is that even with this reduction, energy remains unaffordable for many
Stewart McCulloch, CAP Chief Executive
The drop, which would see the average annual bill for a household on a standard variable tariff fall from the current £1,758, is driven by a combination of lowering wholesale costs and the government’s Autumn Budget measure to cut energy bills by £150 this year.
However, CAP warns that while the reduction is a welcome relief, it only partially offsets the long-term trend of high energy costs. For those on the lowest incomes, who have already spent years making impossible choices between heating and eating, a 7% cut to unit rates still leaves energy costs significantly higher than pre-crisis levels.
Stewart McCulloch, CAP’s Chief Executive Officer, says: “Any reduction in the price cap is a small burden lifted from households that have been suffocating under the weight of high energy bills. We welcome the government’s intervention in the Budget, but we cannot mistake a price drop for a problem solved.
“The reality for the thousands of people we serve is that even with this reduction, energy remains unaffordable for many. Our own polling research shows that around 9.5 million* adults in the UK have a ‘deficit budget’—this means their income doesn’t even cover the cost of basic essentials. When you are already in the red every month, a small decrease in unit rates doesn’t get you out of debt; it just means you are sinking slightly slower.”
Further polling** from CAP also highlights the desperate measures people are already taking:
- 23% of UK adults have reduced the amount of time they heat their home in the last 12 months.
- 14% of UK adults have gone without heating their home during the previous year.
Stewart McCulloch continues:
“At CAP, we see the human face of these statistics every day. Poverty robs people of hope and leaves them isolated in damp, dark homes. This isn’t just a financial struggle; it’s a mental health crisis. Half of our clients tell us they had considered or attempted suicide before seeking our help.
“Through our local church partners, our Debt Coaches are on the ground providing free debt help and emotional support, but charity cannot be the only safety net. We reiterate our call on the Government to establish an Essentials Guarantee. We need a social security system that ensures the basic rate of Universal Credit always covers life’s essentials.
“We urge policymakers to look beyond the headline price cap figures and see the millions of people still living in cold homes. We need long-term, decisive action to ensure that everyone in the UK can afford to keep the lights on and their families warm.”
NOTES:
*Polling commissioned by CAP and conducted by Opinium. Total sample size was 2000 UK adults. Fieldwork was undertaken on 29th August 2025 — 2nd September 2025. The survey was carried out online
**Polling commissioned by CAP and conducted by Opinium. Total sample size was 2000 UK adults. Fieldwork was undertaken on Friday 28 March — 1 April 2025. The survey was carried out online.
