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Ofgem: 'social tariffs must be cheapest deal'

Energy companies' social tariffs must equal their cheapest deals, Ofgem has said as part of the regulator's new guidelines to help fuel-poor consumers.

Following the 2008 Budget, suppliers agreed to increase their investment in social programmes to help the fuel poor ¿ those spending more than a tenth of their income on energy - by £225 million between 2008 and 2011.

But the tariffs available to their most vulnerable customers only had to match their direct debit deal, meaning some would not be on their supplier's cheapest deal.

The new guidelines tighten the definition of a social tariff to protect these customers from paying more than they need, Ofgem said.

Ofgem spokesperson Sarah Harrison said: "The range of initiatives will help in the challenge to target support effectively so that the £225 million can contribute to tackling fuel poverty."

A spokesperson for British Gas said: "We are looking at the details of the Ofgem announcement on Social Tariffs and the implications."

Some consumers may still be able to get a better deal by switching to another supplier, particularly if they are also able to change payment method, the regulator added.

But for customers who are unlikely or unable to switch and are eligible for a social tariff this ruling means "they can be assured they will be on their supplier's best deal," Ofgem said.

Consumer watchdog energywatch said the most progressive suppliers, notably Scottish&Southern and EdF, already offer this arrangement.