Unless the government intervenes, according to a new estimate published by the TUC today (Friday), energy expenses are projected to exceed two months of typical take-home pay in 2023.
The average take-home income (after taxes) will be £2,054 per month in 2023, according to projections by the Bank of England. At £4,108, two months’ salary will be less than the £4,200 per-household cost of energy in 2023.
Just like they did during the pandemic, the TUC is urging the government to convene trade union and business leaders at the Treasury to plan an urgent response to the situation.
The union organisation is urging the UK government to halt the October hike in the energy price cap, raise the minimum wage, universal credit, and state pension in October, and ensure that wage increases maintain pace with inflation.
The TUC notes that the present crisis has struck at a time when households have been experiencing the longest and most severe pay compression in two centuries.
TUC General Secretary Frances O’Grady said: “No one should struggle to get by in one of the richest countries in the world.
“But up and down the country, millions of families are being pushed to the brink by eyewatering energy bills. With prices set to skyrocket even further, it’s time to say enough is enough.
“Boris Johnson, Liz Truss and Rishi Sunak need to wake up to the size of this crisis. This requires a pandemic-scale intervention.
“Ministers must cancel the catastrophic rise to energy bills this autumn. And to make sure energy remains affordable to everyone, they should bring the energy retail companies into public ownership.
“Ministers should also act to boost pay – as well as Universal Credit, pensions and the minimum wage by bringing forward planned increases to October.
“And they should fund it through a bigger windfall tax on the obscene profits of energy giants.”
On the need for a long-term plan, Frances added: “Without a long-term plan to prevent a similar living standards emergency, we will keep lurching from crisis to crisis.
“After the longest and harshest wage squeeze in modern history, that means getting wages rising in every corner of the country by strengthening collective bargaining.
“It means boosting Universal Credit so that working people have an adequate safety net.
“And it means fixing our broken energy market by lifting the burden of failed privatisation off families to get bills down for good.”