The number of customers falling behind on their energy bills in Britain has tripled over the past decade as cost of living pressures have pushed families into arrears, according to research from the Resolution Foundation.
The independent think tank’s “Money on my mind” report, published on Wednesday, showed the number of customers falling behind on their electricity bills with no repayment plan rose from 300,000 in 2012 to more than 1 million by the end of 2024.
The number of customers falling behind on their gas bill also tripled from 300,000 to 900,000 over this period, the research found.
The Resolution Foundation said that overall levels of consumer debt among the poorer half of families in Britain have dropped since the financial crisis. The average amount owed by these families has fallen from from £2,617 in 2006-08 to £2,256 in 2020-22 (in today’s prices) – representing a real-term fall of 14%.
At the same time, while levels of consumer debt have fallen, the think tank said that other problem debts, such as falling behind on “priority” household bills such as energy and council tax, have increased dramatically.
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Since the eve of the pandemic, the Resolution Foundation said that council tax arrears in England have risen by nearly half, from £4.6bn in 2019-20 to £6.7bn in 2024-25 (in today’s prices). The think tank pointed out that the penalty for accruing these arrears can be severe, including prison sentences of up to three months.
Its research also showed that nearly a million electricity and a million gas customers are now behind on their bills and the size of their debts have surged: the average electricity debt grew from £500 to £1,600 between 2012 and 2024, while the average debt for gas rose from £500 to nearly £1,400 in that time.
The report showed that these debts remain more concentrated in the poorest fifth of the income distribution, where 18% are behind on at least one priority bill.
The authors of the report said that increase in arrears is principally driven by the rise in the bills themselves, pointing out that families are still paying 50% more for each unit of gas that they use than before the energy crisis, while there has also been dwindling support on council tax but fast-rising bills.
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Resolution Foundation suggested that improving council tax support and introducing a new “social tariff” on energy bills targeted at poorer households would help address the ongoing accrual of debts, adding that relief and recovery on energy arrears would require careful oversight from regulator Ofgem.
