‘Poorest Will Need To Spend Two Thirds Of Their Income On Energy Bills Next Year’

Energy bills will be impossible for the poorest to pay next year without considerable support, think tank warns.

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In 2023/24, after housing costs, low-income people would spend 26% of their income on gas and electricity, up from just 12% two years earlier, according to new study from the Joseph Rowntree Foundation (JRF).

Comparatively, middle-income households will spend just 11 percent of their income on the same expenses, up from 4 percent.

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After housing costs, some of the poorest households will be required to pay two-thirds of their income on energy costs, the think tank claims.

The analysis takes into consideration the government’s pledge to index benefit increases to inflation in order to assist the most needy.

JRF utilised predictions of growing energy costs to anticipate how much households will spend in bills as a percentage of their overall income, as well as the influence of current government policies.

For example, a low-income, childless, single person of working age who consumes the same quantity of energy as in 2021/22 might expect to spend 67% more.

If they consume the same amount of energy as in 2021/22, working-age single-parent low-income families would lose over a third (35 percent) of their income to energy bills, while low-income seniors will pay out over a fifth (22 percent) of their income.

According to JRF, this will force them to choose between living in a frigid house, going without a necessary item, falling behind on their expenses, or falling into debt.

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Peter Matejic, Deputy Director of Evidence and Insight at the Joseph Rowntree Foundation, said: “People who rely on social security have been put through the wringer this year and many will wonder how things could get any worse.

£Unfortunately, our research shows this is exactly what could happen if the Government doesn’t take further action to protect those most at risk.

“With energy bills an increasing percentage of people’s outgoings, the deprivation so many have felt this year will be compounded. That means more meals skipped and more people going cold or hungry.

“The next Prime Minister should spell out what they are planning to do to prepare for this unfolding crisis.

“One of the simplest ways to relieve the burden on poorer households is to stop deducting debt repayments from benefits at unaffordable rates. This practice makes an already inadequate rate of social security even lower still.

“In addition, the government should increase basic Universal Credit entitlements to ensure it always, at a minimum, enables people to afford the essentials when they fall on hard times.”

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