Never before have households across the country experienced such a serious increase in their bills as this year. The sharp rise in energy bills starting on Friday is perhaps the most obvious of all these price increases. But this is not the only big change we will see reflected in our outings in the coming months. Use the Chrome browser for a more accessible video player 2:47 Energy bills could be the highest in 70 years There are a number of changes in our taxes, some of which will be canceled by the measures in the spring statement of the chancellor. There is a rising cost of living, increasing the cost of items in stores. There is the cut in real terms that will soon begin for allowances and pensions, not to mention the end of VAT aid for hosting companies. Even if it were not for the tsunami of rising price pressures from abroad, this would pose a serious challenge to the standard of living of the British people. Put it all together and understand why the Office of Budget Responsibility expects this year to see the biggest drop in real disposable household income to a modern record. However, trying to understand what this means in practice for the average household is indeed very difficult. This is partly due to the fact that there is no such thing as an average household. This is partly due to the fact that the range of measures implemented in the Spring Declaration is designed to mitigate the blow for different income groups. Read more: Should the chancellor return in the fall with more money? To understand what I mean, let’s try to take a step back and think about what ‘s going on here, starting with the “average household”. Now, according to Ofgem, the “average energy bill” will increase by 693 £ to 1,971. From today. This is, we all know so far, an unprecedented increase, but these inverted parties really matter, as this number is really just an illustration. In fact, when Ofgem calculates the price cap, it puts a price cap not on a total bill – indicative or otherwise – but on a gas or electricity unit. Thus, while some households may see an impact similar to the numbers they read about in the headlines, in practice the drop in their incomes can be very different – and it largely depends on how much energy and heat they need and use. Even so, owning one is still beyond the reach of the average person. Until the recent spring declaration, the average household was under a lot of pressure from tax increases: the health and social care contribution and the frozen income tax thresholds, which, as we said, were going to cost around 4 430. However, the spring statement, with the increase of the limit of National Insurance, will eliminate 330 £ from it. Use the Chrome browser for a more accessible video player 13:40 The UK’s poorest “is my priority” Reducing the fuel tax will reduce household costs by about £ 100 – although note that this does not take into account the increase in costs charged by petrol companies. In addition, the tax cut of the chancellor’s council and the reductions in energy bills will reduce the cost for the “average household” by an additional 190 pounds. If you make your money, you will have it all – once you increase your National Security limit benefits and deduct the health and social care fee – the net impact of the chancellor’s actions is to increase the ‘average’ household income by £ 360 about. In other words, this is about half the increase in the cost of the average energy bill. Use the Chrome browser for a more accessible video player 2:22 Inflation is squeezing households But now let’s look at the very rich 5% of the population. For these people, the net impact of the chancellor’s measures is to reduce their income by more than λί 2,000. This is above the bills that could, based on what we know about the distribution of energy bills, could reach an annual average of £ 3,000 this month. Now, many families in each of these income scales will be able to maintain financially risky even when prices and costs are rising. Follow the Daily Podcast on Apple Podcasts, Google Podcasts, Spotify, Spreaker But the point remains that we have rarely, ever seen such sharp cost increases happen so quickly in this country. It is a very brutal form of inflation. And while the chancellor’s recent measures will slightly soften the blow, they will not come close to eliminating the pain for millions across the country.
