110,000 families in 'serious arrears' on their utility bills
Published 23/09/2010 | 05:00
MORE than 110,000 families and individuals who ran up huge arrears on their electricity and gas bills over the past nine months had to sign up to special repayment plans to avoid being cut off.
A shocking 90,000 ESB customers and 23,000 Bord Gais consumers have been forced to take this drastic action since the beginning of this year because they simply cannot pay their bills.
If they don't sign up to the special plans, they face the grim prospect of being disconnected.
Almost 11,000 householders have been disconnected so far this year, twice the number in 2009.
The disconnection rate is rising to new alarming levels, and is now running at almost 2,500 households a month -- some 80 a day.
John Mullins, Bord Gais chief executive, described the crisis as "a middle-class recession".
"We are going into gated homes to switch off the gas," he said.
The energy companies involved, ESB, Bord Gais and Airtricity were yesterday called before the Oireachtas committee on Communications, Energy and Natural Resources following the shock disclosures.
The committee said it had taken the decision following concerns about the high rate of disconnections in recent months, the cost of reconnection and the increase in electricity prices.
MJ Nolan, committee chairman, said the there was a "worrying trend" under way.
A total of 10,678 customers have had their electricity disconnected so far this year.
The disclosures graphically highlight the impact the recession is having on families nationwide -- with more pain in store in the looming Budget.
The ESB yesterday confirmed the figure of disconnections and said it that it would incur €20m in bad debts as a result of the arrears -- twice the level of 2009.
Thousands of mortgage holders in arrears on gas bills are re-negotiating their payments, at the rate of one every five minutes.
As many as 16,000 of the 600,000 Bord Gais customers nationwide are in serious financial difficulties.
The company has set up around 23,000 payment plans since the beginning of the year for gas and electricity customers in arrears.
The ESB is also dealing with 90,000-plus customers whose bills are in serious arrears.
Bord Gais and the ESB, face a spiralling number of customers falling into serious repayment arrears and risking disconnection over the forthcoming winter.
Bord Gais confirmed that it was now dealing with a 4,000pc hike in the number of its customers whose bills were 120 days or more overdue.
John Mullins said the company was doing everything possible to help people in such situations -- including offering special repayment plans.
However, he said the firm had no option but to disconnect supply if the customer failed to engage with Bord Gais.
"We have no other option if we are faced with a moral hazard -- we have no choice if people refuse to pay bills, refuse to engage with us and try to leave other customers, who are paying their bills, to suffer," he said.
Bord Gais insisted that disconnection was only carried out as a last resort.
On average, Bord Gais is now disconnecting 230 homes per month from gas supplies -- and the majority of cases involve people in privately owned homes.
In contrast, the ESB is now disconnecting an average of 900 Irish homes each month -- roughly 30 homes a day -- for the non-payment of electricity bills.
Charities including St Vincent de Paul, Simon and Threshold are now deeply worried that the numbers of Irish families sinking into 'energy poverty' will spiral over the winter months.
Age Action warned that pensioners were exceptionally vulnerable to such energy poverty, being extremely reliant on heat over the winter months.
Charities are also worried that the cutbacks in the forthcoming Budget -- described by some politicians as the most draconian in Irish history -- will drive thousands more families into utility arrears.