To worry that people think the price cap means unlimited energy

[Shortjanet]

I've read quite a few comments here where posters seem to think fixed or capped energy prices mean that you can pay a set or limited amount for unlimited energy. It's quite worrying to think how much debt people might run up. The way the headlines are describing it as "bills capped to £x" or similar is helping to fuel the misunderstanding (no pun intended) I think. AIBU to wish the media were being clearer that caps and fixes apply to each kWh used and standing charges, not the total you can pay.

I agree that some people will struggle to understand but many others are just too lazy or disengaged to take responsibility.

Read the thread this morning about a supply teacher planning to walk out because the Y11 pupils won't even acknowledge her. So much disregard and lack of respect for education, and that will have an impact on their future daily lives.

agree that some people will struggle to understand but many others are just too lazy or disengaged to take responsibility

Exactly. People take pride in 'being bad at maths' and taking an interest in finances and financial responsibility/being careful with resources is seen as 'boring' and 'not living your best life'.

It's depressing, especially when these people are likely to expect help and sympathy when they get the massive bill because they didn't bother to take an interest and 'no-one told me it would cost this much'.

My eldest sent me this film to watch.
Even he said "it's a comedy... but maybe a documentary" 😂

People get their main information from news outlets and they are reporting completely incorrect and misleading information. Its no wonder people are confused and dont understand it

People get their main information from news outlets and they are reporting completely incorrect and misleading information. Its no wonder people are confused and dont understand it

@bellac11 I'm just not sure they are... I mean, we've all understood it enough from the news to know what is meant by the cap and to decide whether or not we need to do some of our own research...

They should be checking their bill and what they are signing up to not just blindly agreeing

@bellac11

By way of a quick example.. below is the last update from BBC news on the price people will pay...

It's fairly concise and clearly spells out:
-it's a typical household
-the change from current

What else would you want them to add in to make it more clear?

It's difficult. I can calculate my own bill based on my expected usage, but see a lot of people who don't really understand what it means. Generally speaking, energy bills are not easy to understand for the majority and people will look at the payment rather than the breakdown because of that.

Martin Lewis tends to explain it fairly well in so much as if you currently pay £x you'll be paying £y, which people typically take in as its relatable to them. Saying your kwh price is 7.4p means little to most as there's no relatability to what a kwh looks like.

It's quite horrible to mock people for not understanding things. Even moreso when the information has been put out in a misleading way. And saying if someone has time to use Facebook they have time to Google is ridiculous. Similarly, if you have time to mumsnet you have time to read up on how to be a better person.

Also to whoever said mortgages, credit cards and marriage vs cohabiting are on the curriculum, they aren't. Calculating APR is way beyond the capability of pupils who are studying intermediate or lower level maths, as are things like compound interest, LTV and so on. Religion is really not the area to teach about the practicalities of marriage vs cohabiting either, where the focus is on the moral view and not the pragmatic one.

I cant remember if its this thread or the other one but the average reading and comprehension age in this country is very low

No where in that article does it state the unit cap, or explain what is meant by typical or average, let alone the fact that there is no typical or average in this scenario.

The entire article is completely meaningless. Unless of course you happen to be already paying around £1900 per year and are the person that the article is based on. Unlikely.

I take it back, I have just realised that we are the exact family in the article. We currently pay 1900 a year based on last year

I would say we are very much not typical. We have a wood burner for one so a lot of our heat is subsidised by that, we have very low gas usage. But apparently (according to this forum) we have very high electric usage which I am still trying to figure out why.

Can I point out, as an aside, that you are taught a lot of things in school.
But if you don’t practise, maintain, improve and develop that knowledge, it doesn’t stay shiny and sharp and ready to use. It atrophies.
Most adults that passed GCSE maths comfortably would struggle a decade further on, unless they’ve continued to use those skills.
I spoke fluent German at one point in my life, not now.

On a related matter, are people not taught to assess reliability and interpretation of information at all? It would be a useful part of GCSE English, Maths and Science for a start.

Which are 'good' sources of information, which have a fairly obvious hirearchy, ie official sources like gov.uk, regulators and the energy suppliers, followed by well regarded media and consumer sites like the BBC and Moneysaving Expert, then tabloids and social media where the tabloids liberal use of 'could', 'is thought to' and 'may' effectively make whatever is written fairly meaningless unless corroborated by a source further up the hirearchy, so comprehension of what is actually written down.

Forums and social media are obviously unreliable as people can write anything, especially when anonymous, so it can't be the case that people 'get most of their news' from there. 'I read it on social media' but never bothered to check it out properly myself, well more fool you.

Maths and science can obviously crunch the numbers but also teach people to ask more questions and check the validity of the data.

'The price cap is £X'

How is this worked out?
How do the usage figures compare to my situation?
If my use is above average, why is this and what can I do to improve?

@NorthStarRising well said.

Most accountants use calculators because its been so long since they did mental arithmetic.

And maths in school isn't fantastic for helping everyone with real life situations- financial management is needed too. Answering 'if I had 8 apples and Sue stole 3 apples, how many apples would I have?' doesn't really set one up for working out the finer points of their energy bill 20 years later...

Energy price cap will rise by 80% to £3,549 a year from October 2022, Ofgem announces - The i

Ofgem raises energy price cap by 80% to £3,549 - the Guardian

Ofgem raises energy price cap by 80% to £3,549 - amid fears it could hit £7,200 next spring - Daily Mail

Some of the headlines from August when the new cap was announced. Not helpful. And if you were already struggling with your bills would you then go on to read the fine print in the article, or shut the page down quickly in a panic?

Its extraordinary how one of lifes basic necessities for every single citizen has become so insanely complicated and misrepresetned in UK.

The whole energy thing is a shit show from A-Z.

Having said that surely everyone knows we all pay for the energy we use?

True, if I were struggling and saw some sensationalist / generalised news headlines that would likely impact me, I'd quickly close it down in a panic, shut my eyes, pray it goes away and hope a grown up would deal with it for me.
Sorry... this is what I'd do if I was 10 years old.

As an adult who takes accountability for myself, I'd probably use some incredibly basic reasoning / investigative skills to ascertain what this means for me specifically and figure out what I can do about it to mitigate.

Just close it down in a panic in order to shelter under the blanket of ignorance?? 😂
Jeez... I just can't convince myself that any adult (outside of learning difficulties who need assistance etc) who would actually think like that.

@alwaysmovingforwards some nice judgement and prejudice there. You've never experienced an anxiety or panic disorder I take it?

@bellac11

No where in that article does it state the unit cap, or explain what is meant by typical or average, let alone the fact that there is no typical or average in this scenario.

Oh come on, really? You're a) suggesting this needs to be included in every article (and that individuals aren't intelligent enough to research / work it out for themselves) and b) paradoxically, that one on hand you're saying people don't understand basic concepts ("typical", "average" etc) yet on the other you're saying the article should state the unit cap... as if they'd have a clue what that meant (even after explanation!) if they didn't know what "typical" meant?! Come on. Have faith in people and accept that adults have a responsibility to ensure they have a basic understanding of key aspects of their own lives, to inform themselves where they need to know more and fundamentally "act as adults" (rather than expect to be spoon fed, sheltered, handled with kid gloves etc).

If the ‘average’ is to be £2500 then it will mean electric at 35p per kwh and gas at 10p. So higher than it is currently but way below October’s previously predicted rates of 52p / 14p.
If we also still get the £400 then bills should barely rise this winter.

On a related matter, are people not taught to assess reliability and interpretation of information at all? It would be a useful part of GCSE English, Maths and Science for a start.
Which are 'good' sources of information

History GCSE is good for the source work but DD1 couldn't take it as wasn't an option for her year - though we've been telling them about good sources since they were young.

The rest is hit and miss depending on school/teachers and syllabuses plus where IL are many didn't pass GCSE maths or English.

Plus IL know many their ages who left school at 15 went straight to work place and unlike my parents haven't really studied since.

Readability data suggest that the average reading age of the UK population is 9 years – that is, they have achieved the reading ability normally expected of a 9-year-old. The Guardian has a reading age of 14 and the Sun has a reading age of 8.
Are you aware how literate your employees are

Even in UK with universal education up to secondary school level for decades literacy rate is 99% so 1 in 100 struggles.

una.org.uk/international-literacy-day-factsheet

I'm more surprised on MN - tending towards younger and more educated than general population - that there is such confusion. People with fixed monthly direct debits for fuel surprised they pay for more than they use in summer building up credit - if you don't like doing that variable direct debits or quarterly bills are options but for many mean large bills in winter are avoided when income is same amount each month.

Don't forget there will also be a few people who's bills are included in their rent so may be looking at this for the first time to get an idea of how much their rent might go up and how they can reduce the potential for that.

Then there are those with conditions that make understanding statistics a bit harder than for typical people - such as dysculia.

People with mental health conditions (which have rocketed in the last few years) often have trouble with concentration, especially when it comes to new or unfamiliar information/data.

The sneering on this thread is horrible.

People understand this and don't expect to fill a range rover for the same as a mini.

Not the point at all, but I parked our little old Golf between a Range Rover (Evoque) and a new Mini some time ago, and they looked to be pretty much exactly the same size!

I do think it's the word 'cap' that's mainly to blame here, though - there's never been any talk of petrol or diesel prices being capped.

Also, when they say 'for the average household', those of us who are possibly a little more astute in this area know that 'average' means typical USAGE; however, I can see how some people could quite reasonably interpret 'average' in another way. If (as they see it), the government is 'setting/deciding' the charges, they may well think that 'average' relates to an average-sized family, an average 3-bed semi, a band-D house for council tax or whatever. They should definitely make it clear that it's average USAGE amount and dump any ambiguity that might make people believe it to be average STATUS/CIRCUMSTANCES households.

"The bills will be capped to £2,500 per year, as long as you don't use any more than the average amount of gas and electricity" - simple and clear, no?

It absolutely should state the unit price seeing as that is exactly the thing that is being capped and the price of it!!

And I didnt say someone wouldnt know what is meant by the word typical or average but that its almost impossible to say, given there is no definition in this scenario, whether the reader is typical or average.

I gave my own example where we pay exactly that at the moment, so our increase is exactly the amount quoted by other posters above, and yet we are not typical in the sense of 2.4 children type typical.

But everyone thinks the are average. Except they’re not. Reporting on this has to change.

I think people are incredibly unaware of how many people struggle with financial literacy.

I used to support adults with very, very basic finances. When changes came in to give people their rent to give to landlords lots of these people got into serious debt because they couldn't do the simple maths of "I need to keep X amount for rent and then I need 4/5 weeks of groceries for Y amount".

The people who came to us were trying desperately to engage but they could not do the maths themselves. Very occasionally someone would get it, but mostly I had to do the sums and say "you can take out x cash each week for groceries and other spending and still have enough to pay your rent and bills" and hope that there was enough buffer in my calculations that things weren't going to go wrong at the next bill increase.