Osborne price plea to energy firms

Chancellor George Osborne has urged energy firms to reconsider price rises that have sparked warnings of more households being plunged into a "long, cold winter".

Amid union and consumer group demands for Government action to tackle rising fuel prices, he said British Gas and Npower should make sure the hikes were the "absolute minimum" necessary.

British Gas announced an extra £80 on its typical annual dual fuel bill, with an average increase of 6% affecting 8.5 million customers from November 16. Npower followed with an average rise of 8.8% for gas and 9.1% for electricity. Both companies blamed rising costs largely outside their control.

With food and some mortgage costs also on an upward path, there were fears about how the elderly and hard-up will cope with the latest rises.

Mr Osborne, who is attending the IMF/World Bank conference in Japan, told ITV News yesterday that the Government had programmes to help people reduce their household energy costs.

"But of course I'm concerned when I see electricity bills going up and partly that is because of things beyond our control - what's happening in the world with oil prices and gas prices. We've also got to do everything we can in Britain to try and keep those bills down. I would urge those energy companies to look again at any increases to see if they are absolutely necessary at a time like this."

Asked if rising energy firm profits were excessive, he said: "I think these energy companies should make sure they're only adding to their bills the absolute minimum they need to add to continue investing in our energy supply and they're not going beyond that."

The pre-winter move from British Gas comes months after parent group Centrica posted a 23% rise in half-year profits at its residential arm to £345 million.

Unions and consumer groups attacked British Gas and called on the Government to take urgent action to tackle rising fuel prices. Unite general secretary Len McCluskey said: "With winter approaching, low-waged people will now be terrified about how they are going to find another £80. Money from the poor is going to the pockets of Centrica shareholders. This is further shameful abuse by out of control, greedy fuel companies, sitting on piles of profit."

Consumer Focus recently said six million households in England were planning to cut back on heating this winter because of cost worries. It has encouraged customers "to do what they can" to cut bills by switching tariff, payment method and supplier.