Committee publication · Correspondence · 15 April 2026 · HC 459
Correspondence from Ofgem following up from 4 March session, dated 27 March 2026
Summary
Ofgem responds to Scottish Affairs Committee questions from a 4 March session. The regulator confirms it does not hold Scotland-specific energy debt figures, though GB-wide domestic debt/arrears exceeded £4.48bn in Q3 2025. Ofgem defends including a £50 bad debt allowance in bills and outlines plans for a Debt Relief Scheme costing consumers £2–3 annually to write off hundreds of millions in debt for vulnerable households on means-tested benefits.
Key findings
- Ofgem does not collect or publish Scotland-specific energy debt data; the vast majority of its Social Obligations Reporting is at GB level only.
- Domestic debt/arrears over 91 days totalled £4.48bn at Q3 2025 across Great Britain, but no breakdown by nation is available.
- A bad debt allowance of approximately £50 is included in typical dual-fuel direct debit bills to recoup suppliers' average unrecoverable debt costs.
- The forthcoming Debt Relief Scheme will write off hundreds of millions in debt for households on means-tested benefits, funded by a one-year bill increase of £2–3 per typical consumer.
- Ofgem states the Debt Relief Scheme will enable wider reset and reform of energy debt systems, eventually reducing bills for all customers.
Tone
ProceduralTopics
energy-policyconsumer-debtpublic-financescotland
Key actors
Patricia Ferguson MP, Steve McMahon, Ofgem, Scottish Affairs Committee
Notable line
“… domestic debt/arrears (>91 days) was £4.48bn at Q3 25, we cannot say what proportion of that was held by customers in Scotland.”
Key Quotes
“Under Ofgem's Social Obligations Reporting we collect various data points on domestic debt/arrears, a summary of which is published here. The vast majority of data points gathered under this collection are at GB level only.”
“Whilst we can say that domestic debt/arrears (>91 days) was £4.48bn at Q3 25, we cannot say what proportion of that was held by customers in Scotland.”
“This is now around £50 on typical Dual Fuel direct debit bills and reflects the average cost of unrecoverable debts to suppliers.”
“Our forthcoming Debt Relief Scheme will write off hundreds of millions of pounds of debt for customers on means tested benefits who will never be able to repay.”
“On current design, this will be paid for by a small, one year, increase to bills which we expect to be between £2-3 for a typical consumer.”
Source · parliament.uk record ↗