Another two energy firms bite the dust in the UK and more of this week's finance news

Another two energy firms bite the dust in the UK and more of this week's finance news

 · 10 min read
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In the financial news summary for this week, read about how smaller energy firms in the UK are continuing to go bust. You can also learn more about the enormous losses Brits face due to unreturned goods, the impact of pension age increases on free bus travel, and more.

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It has been revealed that another two energy firms in the UK have gone bust. This brings the total number of energy companies that have collapsed since September to 24, following a surge in wholesale gas prices.

The latest collapses mean even more of us are facing higher energy bills as we try to keep our homes warm over the winter months. The two latest energy companies to go bust are Entice Energy and Orbit Energy. Entice is thought to have around 5,400 customers, while Orbit has about 65,000. 

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Ofgem working on finding new suppliers

As is always the case when energy firms go under, regulator Ofgem is now in the process of finding new suppliers for those affected. Households have been advised not to look for a new energy supplier themselves. Instead, they should wait until they have been allocated a new supplier by the regulator before they look into switching

Since September, many energy firms have collapsed because they've been unable to honour price promises to customers due to the surge in wholesale gas prices. 

Another energy company, Bulb, has been saved from collapse after the government promised £1000 per customer to ensure it could continue to supply energy. Bulb is currently the seventh-largest energy company in the UK. 

Neil Lawrence, director of retail at Ofgem, said: "I want to reassure affected customers that they do not need to worry; under our safety net we'll make sure your energy supplies continue."

The regulator has also said that people can switch to another supplier if they wish once they have been allocated a new one. However, despite the assurances, there are still many people who are concerned that their bills will rocket due to being moved over to the bigger suppliers.

In the meantime, officials are calling for the regulator to take action given the worrying situation. Gillian Cooper, head of energy policy at Citizens Advice, said, "As suppliers continue to fall like dominoes, it's clear the market is not functioning as it should and there are serious questions for Ofgem to answer about how this has been allowed to happen."

State pension age increases will cause issues with free bus travel

There are concerns over how the increase in the state pension age will affect free travel for older people, as the hikes will affect eligibility for free travel on buses. Vast numbers of people will be affected by this. It could prove to be particularly worrying for those who rely on their free passes to get to medical appointments and to undertake other essential travel. 

At present, the state pension age is 66 for both men and women, but the government already has plans in place to increase this. The official state pension age is set to increase to 67 in 2028, and it will then increase to 68 further down the line. As the state pension age increases, the age at which you can receive a free bus pass will also increase. 

A vital perk for older people

Many older people see their free bus pass as a vital perk of retirement. It enables them to get out and about, visit friends, go shopping, and attend appointments. Some also stop driving due to health issues as they get older and rely on the free bus pass.

The increase of the state pension age and eligibility for the bus pass could, therefore, present a range of issues for many people. It will also have a substantial financial impact on those who rely on the free pass to get around. 

There has been a lot of controversy relating to the government's plans to increase the pension age. Many have warned that it will leave people in a position where they cannot work due to age and ill-health but also cannot claim their state pension. The loss of benefits such as free bus travel will further compound the problem that many face. 

For most people, the delay in eligibility for free travel will hinge on the pension age, with the government stating, "In England, you can get a bus pass for free travel when you reach the state pension age."

However, some exceptions apply. For instance, in London, people can travel free of charge on buses, tubes, and other public transportation once they reach the age of 60. This only applies to travel within London, however. 

Failure to return damaged goods could cost Brits a fortune over the festive season

A recent survey has revealed that Brits are failing to claim millions of pounds in refunds due to not returning items that are damaged or faulty. With Christmas coming up, many people will be shopping for gifts either online or in person. This could see a further surge in losses due to not taking action when items are faulty or damaged.

The research was commissioned by packing firm DS Smith, and 2,000 adults were polled as part of the study. The results showed that 48% have failed to return items that did not work or arrived damaged because they believed it was too much hassle. Some respondents said they were too busy to deal with returns, while others said it cost more to return the item than it did to buy it. In addition, some said they tried to fix products themselves rather than sending them back.

Causing waste, clutter, and financial losses

The data showed that just over one-third of defective items are likely to be returned by buyers, and often the value of the product was the deciding factor in whether to send it back or not. Based on the report, consumers believe that items worth £22 or less are not worth sending back because it causes too much inconvenience given the value. 

However, the trend of failing to return these items has resulted in increased waste, additional clutter around consumers' homes, and considerable financial losses. 

The research was commissioned in the run-up to Black Friday, when many people will be out buying products or having them delivered. According to estimates, around 21 million Black Friday purchases are likely to arrive damaged. 

The CEO of DS Smith, Stefano Rossi, said, "This eye-opening research shows that UK consumers are fed up with being delivered damaged goods. Luckily, it is a problem that is easy to fix; one of the most effective ways to ensure goods arrive safely is to use the correct packaging. Unfortunately, there's plenty of evidence that many brands still aren't doing this - with a quarter of shoppers left frustrated when goods arrive with unnecessary packaging and annoyed when packaging is far bigger than needed."

Among the items most likely to arrive damaged or defective are small appliances such as kettles and toasters, glassware and crockery, and larger appliances such as fridges. 

Many pensioners turn to home equity to raise money

New figures suggest that a rising number of pensioners who own their properties are tapping into their equity to raise money. It is suggested that some pensioners are adding more than £70,000 to their retirement savings by doing this. The research was carried out by Legal & General Home Finance. 

While some pensioners are turning to equity release schemes to release capital from their homes, others are selling up and downsizing to a cheaper property and then pocketing the difference. In some cases, this difference is considerable because of the sharp increase in property prices over recent years.

Wealth from properties worth more than pension pots

One thing that has been pointed out is that there is more value in pensioners' properties in terms of equity than in their pension pots. According to figures, the average value of pensions stands at £61,930 while the average amount of capital released from homes through equity release stands at £72,988.

Over the past five years, average house prices have increased by 24%. During that period, the amount being released through equity schemes rose by £14,000. Homeowners aged 55 and over often find that equity release provides a convenient solution to accessing money. It has become more prevalent amid inflation rises and a tighter squeeze on retirement incomes.

Claire Singleton, the Chief Executive of L&G, said, "We anticipate that using your home to fund your retirement will become more commonplace, whether that's by downsizing to free up funds or releasing money tied up in your home through equity release lifetime mortgages."

Data from the Equity Release Council showed that homeowners aged 55 and over unlocked £1.17 billion of wealth from their properties in the second quarter of this year. 

Research shows many Brits won't share inheritance wealth equally among children

Research carried out by investment management company Charles Stanley suggests that many Brits do not plan to share inheritance wealth equally among their children. While more than two-thirds said they would share their assets equally, another 16% said they would not do this, and a further 16% said they were still unsure.

According to the figures, 68% of adults plan to leave all of their children an equal share of their wealth by way of inheritance. However, only 55% of these said that everything would be split evenly among their offspring. The other 13% said they would first look at how much financial support they had already given to each of their children when deciding how to split their assets. 

Looking at personal circumstances

Of those who said they would not be splitting the wealth evenly, one reason was that they wanted to base each child's share on their personal circumstances. As a result, many want to leave more of their wealth to their less well-off children.

In addition, some of those that do not plan to split their wealth evenly said that the amount they left each child would be based on how well they had cared for them in their later years. 

The research also showed that the decision not to split wealth equally could create issues among siblings. More than one-third of adults said they would be unhappy if they received less inheritance than their siblings, and less than 25% said they would be indifferent. The data suggests that those most likely to be affected by being left less than their brothers and sisters were middle-aged and older people. 

A lack of communication

Another thing highlighted in the research was the lack of communication between parents and children when it comes to inheritance. Only 20% of Brits said that their parents had discussed inheritance with them so that they could plan things in advance. In addition, 15% said that their parents had not left a will or did not have one. 

Alex Price, the Director of Financial Planning at Charles Stanley, said: 'Where there's a will, there's a war. It's not always easy to start those conversations as they can seem awkward and uncomfortable, but avoiding the subject is not the answer and could come at a price."

He added, "Not only could families lose out financially by not planning ahead and taking advantage of legitimate inheritance tax exemptions, they could also be leaving a legacy of family conflict which could be avoided."

Reno Charlton
Reno Charlton
Reno joined Age Group in 2020 and has nearly 20 years of writing experience. Although she specialises in writing about finance topics and covering finance news, Reno is also a published author and has written several children's books and short stories.
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