Can you cancel direct debit payments on energy bills?

With the price of living rocketing over the past few months, and late 2022 and early 2023 looking likely to see hikes around 70%+, there’s no wonder a growing movement of families are considering what is essential when spending money. Part of this process has included many families asking how to cancel direct debit payments for energy bills and what will happen if they join the #dontpayuk movement. Many of the large energy, gas, and fuel suppliers aren’t helping much either with companies posting huge profits but failing to pass these on. Recent news stories have featured how BP have no immediate intentions of passing on fuel savings to customers at the pump, despite posting huge profits. In fact, the UK’s biggest energy firms racked up over 1 billion in pre-tax profits prior to the recent cost of living crisis.

Add in a mixture of inflation and scarcity of food resources caused, in part, by the troubles in Eastern Europe, a dollop of poor pay policies and below inflation increases for many public sector jobs, and a smattering of the US ‘technically’ falling into a recession and it looks like many have the recipe for financial disaster.

But why are families struggling to keep on top of their finances and can you cancel your direct debit if you can’t afford energy bills?

How are families coping with the increased prices of energy, food and fuel?

All families are different. Some have small homes, some large. Some are energy efficient, some not. Taking into account the other variations like salary, loans, family size and whether you’re off pensionable age and you’ll start to get an idea of how difficult it is to predict how the rest of 2022 and 2023 is going to go financially for many.

If you take into account the expected 70% energy cap rise expected this October, many families will be seeing an annual energy bill in excess of £3300+ as typical! This will leave many pensioners who live alone spending almost half of their state pension on energy, before even considering food, telecoms, transport, insurance and other essentials.

Larger families, even with benefit support payments and the proposed £400 energy grant being rolled out by the government via the energy suppliers, will struggle to keep up also. This puts many in the horrible situation of having to prioritise what needs to be cut in order to keep food on the table and wondering if they can cancel their energy direct debit.

Can I cancel my energy direct debit if I cannot afford the cost?

Before any rash decision, if you’re struggling to the extent that you’re considering listening to the recent online campaign to promote a payment strike on October 1st 2022, please consider reaching out to one of the many support services out there like StepChange or Citizen’s Advice.

Consider talking with your energy provider directly first about existing customer deals

It’s also worth talking directly to your energy supplier before making a step to cancel direct debits. Whilst most people are not recommending switching suppliers right now due to the constantly changing marketplace, there ‘may’ be better deals available with your existing supplier, particularly if you’re on the standard rate. Always compare any fixed rate against what you expect the rate to jump to in October+. The Money Saving Expert website has some great articles on this and what to expect in terms of prices and costs for energy when switching.

You’re not going to get arrested if you cancel direct debits.

Firstly, not payment of energy bills is not a criminal act. Whilst it’s not a traditional credit agreement like a loan or credit card, non-payment of your bills could result in the following:

• Mark on your credit record
• Removal of option to pay via direct debit in the future (ie. you’ll need to pay quarterly by bill and this can be more expensive)
• Warrant to install a pre-payment meter (via the courts)

Ultimately, the reason many people are talking about the October 1st energy payment strike is that a similar action many years ago had the effect of the UK government scrapping a proposed Poll Tax. That historic action was very different though and not dependent on so many other factors that are dictating the prices, profits and financial woes of today. That being said 17 million people collectively standing up toppled Thatcher’s policies back then.

The Don’t Pay UK movement states in its manifesto:

‘Millions of us won’t be able to afford food and bills this winter. We cannot afford to let that happen. We demand a reduction of bills to an affordable level. We will cancel our direct debits from October 1st if we are ignored.

So, are there other things you can do to save money on energy, fuel and supplier bills?

Things to try to save money, cut back, and help to avoid thinking about cancelling your energy direct debit.

Whilst the ideas below aren’t going to fix the issues associated with the energy price rises and the cost of living and inflation in 2022 and 2023, they may help.

Clear your unwanted or unused books, DVDs and games

Sounds obvious, but the amount of clutter we often have within our homes that never get cleared is astonishing. It could be worth valuable pounds that could be better put to work elsewhere. They all pay differently and usually work via a simple smartphone scanning app. In our experience, either Ziffit or WeBuyBooks offered the best returns. If you notice a book scan above £2-3 pounds on the app, check how much they’re going for on eBay, as this may be an indication you’ll get more selling that one privately via auction. Check the app’s web pages first for sign-up offers for an extra % on your first trades.

Plan your meals to avoid waste and cut costs to save money for energy bills

Do a kitchen cupboard audit. What can you use up before making decisions to buy more food? Are there some savvy slow cooker bulk dishes that you can make and freeze to use over a longer time frame and avoid waste?

If you are venturing out to the supermarket make sure your lists are well planned. Where possible make advantage of cashback offers and multi-buy deals. More and more people are swapping to the discount brands like Lidl and Aldi. If you can find an Aldi store nearby, this may be a savvy swap to try. However, if you’re using stores like Sainsbury’s, Asda or Tesco, there are still deals to be had and you can make the most of Clubcard prices and planned recipes or the Sainbury’s Nectar Points scheme. In fact, even though readers should be aware of not chasing points at the expense of pricier items, we often build our Nectar points for the Sainsbury’s Double Up events in the winter which often pay for Christmas food and drink.

Cash in on cashback and receipt scanning

There are a whole host of receipt and cashback apps that you can use to recoup the money spent on groceries. The trick is not to buy them unless they’ll make you a profit or you’ll actually use them. The ones we use regularly and suggest are featured below, whilst there are more, these are the most efficient and worth the time versus money reward in our opinion:

• Shopmium (plus refer to make more items completely free)
  Get a FREE can of Pringles when you download the Shopmium app and use our referral code KMYEUFYL
  We already saved £545.35 with all the Shopmium offers since we started using it a few years back.
• Green Jinn
• Checkout Smart (£5 minimum to request cashout)
• Clicksnap (Quidco)
• Amazon Shopper Panel

Get energy and fuel discounts to avoid cancelling energy direct debits

Trim the non-essential expenditure to put toward energy bills

An audit of direct debits and monthly outgoings will often be a good place to see what you’re paying for each month, but potentially not using or needing. Take your phone bill for example, with wifi calling inclusive on many broadband, tv and call offers, you can often look into not including expensive bolt-ons like unlimited calling packs. Whilst this was a common necessity in the late 90s many call bolt-ons are often unneeded in the age of Zoom, Skype and Google Hangouts.

Try calling up your provider and seeing if they have any existing customer deals. After all, if there are offers for new customers, why not for the loyal existing members?

Speaking for treating existing customers fairly, a new rule brought in during 2022 means that existing customers with car insurance must be offered ‘like for like’ offers and rates as new customers. This means that, in theory, many loyal customers with car insurance may see better deals when they renew. We say “may”, as even with this new ruling, the cost of insurance for cars has risen over the last few months by around £30 -£40 on average.

Whilst these are just a few ideas to get started on, they can make a positive difference to work on as a family. Getting the kids to sort the DVDs and books around the home to sell online or at a car boot sale is a great way to feel active in making small steps while you look into other ways of saving and making money. Ultimately we hope that the UK government intervenes to ensure large profits are not being had at the expense of struggling families – watch this space.

*Disclosure: This article is for entertainment and educational purposes only. I am not a financial advisor and you should always do your own research and consult a qualified financial advisor before making big decisions with your money as capital may be at risk. This post may contain links to external sites and affiliates, Savvy Dad accepts no responsibility for how you use these external sites and services (see Site Terms and Privacy Policy).