High electricity bills sparks record numbers of emergency cash payouts for struggling families

EXCLUSIVE: Record numbers of households are being forced to access emergency payments to keep their lights on, as people who “thought they would never be in this position” seek help to survive.

A record number of families are accessing emergency payouts to help them pay electricity bills.

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RECORD numbers of households are being forced to access emergency government payments just to keep their lights on, as people who “thought they would never be in this position” seek help just to survive.

Welfare advocates say eligibility restrictions on the payments hide the true scale of how many South Australians are in dire financial predicaments — and the problem will only worsen.

State Government figures released on request to The Advertiser show the number of people accessing its emergency electricity payments scheme last financial year rose by 30 per cent, to almost 1200 households.

Businesses — which are not eligible for the payments — are also “deeply concerned” about the impact of high wholesale electricity prices across the entire economy.

A total of $467,000 in taxpayers’ cash was handed out under the scheme in 2015-16, which is available to people who have had their power turned off or are just about to.

However, it can only be accessed once every three years, sparking fears many needy people are still missing out.

Applications for support of up to $400 are made by financial counsellors on behalf of clients who are struggling to make ends meet, and then paid directly to their energy providers.

SA Financial Counsellors Association executive officer Wendy Shirley said a rising number of people who “thought they would never be in this position” were now being forced to seek emergency help as high unemployment pushed them onto welfare payments or lower-wage jobs.

“Many people are going down to part-time work or lower wages or benefits and that is a significant loss in income,” she said.

“We’re seeing more and more of those people.

“We are paying the highest prices in the country for electricity at the moment. There’s a whole host of reasons for that, but we expect that it is going to get worse before it gets better.”

Ms Shirley said the limit on payments to once every three years meant the true scale of need was “hidden”, because those previously helped were excluded from this year’s numbers.

Premier Jay Weatherill last week announced a package of measures aimed at containing future electricity price increases, including a bulk purchase of government electricity which could underwrite new baseload production as well as incentives for new gas supplies.

A report recently delivered to Treasurer Tom Koutsantonis by the state’s utility price watchdog also found households could save up to $950 per year from changing their energy suppliers.

Currently, futures markets are predicting SA’s wholesale electricity costs will rise to double that of New South Wales and almost two and a half the rate of Victoria’s in the next 18 months.

Business SA executive director, industry and government engagement Anthony Penney said there was “deep concern” about the impact of rising power prices across the whole economy.

He said they threatened to both hit high-energy consumption companies in the state’s manufacturing sector as well as weaken the buying power of average retail customers.

“There is a direct flow-on affect to business and retail trade figures if households are struggling to cover basic essential services such as electricity,” Mr Penney said.

“If a family can’t afford to keep the fridge on, they’re not going to go out and buy a new one.

“Business SA is deeply concerned about the impact that high wholesale electricity prices are having across the entire economy, including those most disadvantaged in our society”.

He called for an independent inquiry into SA’s energy market to help develop a long-term plan.

A Government spokesman said the rise in people accessing the payments could also be attributed to an increase in funding for financial counsellors and promotion of the scheme.

“Traditionally, this safety net was undersubscribed, prompting the State Government to actively promote it among financial counsellors and other organisations,” the spokesman said.

The Government has also launched a separate cost of living concession of up to $200, which replaces a series of payments for low-income people and is going to renters for the first time.

Uniting Communities executive of advocacy Peter McDonald said the maximum $400 electricity payment was still below the amount required to clear debts for many struggling households.

“What is disappointing is that electricity prices just keep going up, despite a number of years of rapid price increases,” Mr McDonald said.

“This has lead to growing numbers of people being disconnected, each year, for inability to pay for the essential service of electricity.

“The fact that households can only apply once every three years means that considerable numbers of people who are disconnected for inability to pay are not able to be assisted through EEPS, the effectiveness of the gap between applications needs to be reviewed.”

He said it was a “sad reality” that many more people were plunged into “energy stress”.

Opposition communities and social inclusion spokesman Duncan McFetridge said the figures were a “canary in the coalmine” that revealed a meeting of major problems for the state.

“The Government has been peddling false hope and there is no long-term solution for this state when it comes to spiralling energy prices,” he said.

“It’s sad that a system like this has to be put in place, and to see the numbers increasing as they are is really quite disturbing.

“The outlook is not rosy when you’ve got predictions of job losses through Holdens and the ripple effect that will have, as well as where prices are heading in the next few years.”