Ofgem announces consultation on debt support scheme

Ofgem has announced a consultation on a "Help to Repay" style debt relief and repayment matching scheme, set to launch in 2025, and has launched a separate consultation on improving debt standards so that customers in debt are treated fairly whichever supplier they are with¹. The announcement was reported by Fair By Design, which campaigns on the extra costs faced by people on low incomes, on 16 December 2024¹.

Fair By Design said the proposed scheme could offer debt write-off and repayment matching of between £0.5bn and £1bn in total, and could provide targeted support to up to 2.3 million people who have fallen behind during the energy crisis¹. The organisation has been part of the "Help to Repay" campaign alongside Money Advice Trust and 12 other organisations¹.

Total energy debt now exceeds £3.8 billion, an increase of more than £2 billion over the last three years, according to Fair By Design¹. The organisation said this leaves millions of people, particularly those on low incomes, struggling to keep up with payments¹.

The campaign sits within wider work on energy bills for low-income consumers, which includes calling for an energy social tariff to ensure affordable energy bills for everyone, and more generous short-term support until such a tariff can be put in place¹. Ofgem's own words on the consultations, and the detail of what the debt standards consultation covers, have not been reported in the material available.

Why it matters for households

Energy debt of more than £3.8 billion has built up over the last three years, and the proposed scheme is aimed at people who have fallen behind on bills during the energy crisis¹. The figures reported are a total of between £0.5bn and £1bn in debt write-off and repayment matching, and up to 2.3 million people who could be supported¹. The scheme is described as set to launch in 2025, following a consultation¹. Separately, the consultation on debt standards concerns how suppliers treat customers who owe money, with the stated aim that treatment is consistent across suppliers¹. No eligibility criteria, application process or start date beyond 2025 has been reported.

What happens next

The scheme is set to launch in 2025, subject to the consultation announced by Ofgem¹. The consultation on improving debt standards has also been launched¹. Further detail on both consultations has not been reported.

For background on arrears, repayment arrangements and rights when dealing with creditors, see the guide to debt help, solutions and your rights.