LONDON (Parliament Politics Magazine) – According to new research from the Trades Union Congress (TUC), energy bills are expected to grow at least 14 times faster than salaries this year.
According to the TUC, average weekly earnings will increase by 3.75 percent in April, but Ofgem’s price cap for gas and electricity would increase by 54 percent.
As a result, increases in energy prices could cancel out or outstrip wage increases.
The government claims to be delivering £21 billion in bill relief, but it has rejected a freeze on National Insurance increases.
The 1.25p tax hike takes effect in April, coinciding with the growing cost of energy, which is set to worsen because of the Ukraine war crisis which is leading to a significant rise in the cost of living.Â
The Resolution Foundation believes that the average household income would drop by around £1,000 in real terms this year, the greatest drop in living standards since the mid-1970s.
People on low incomes will take the hardest hit by the record energy costs, according to the TUC, because years of sluggish wage growth and benefit cuts have left poorer families “badly exposed” to cost-of-living hikes.
According to the TUC, energy bills have grown at twice the pace of average wages since 2010.
Households are being “pushed to the brink,” according to TUC general secretary Frances O’Grady, who has urged the government to levy a windfall tax on oil and gas revenues to give extra support.
Rising gas and oil prices are also pushing the other costs higher, with average petrol prices of £1.60 a litre, a new record high.
The steepest train fare hikes in nine years went into effect earlier this month, raising prices by 3.8 percent.
Last month, inflation, which accounts for changes in the pricing of goods and services across the UK economy, hit a 30-year high of 5.5 percent, with the Bank of England warning that it could surge above 7% this year.
As a result of the war, food prices are projected to rise even further, as Ukraine and Russia normally supply 30% of the world’s wheat.
The government has been called on by the Labour to stop the government’s planned National Insurance increase, which will cost someone earning £30,000 an extra £214 per year.
Downing Street, on the other hand, has stated that it is completely committed to the rise. This is expected to help deal with the NHS backlog from coronavirus and fund social care. Â
According to a government spokesperson, the government’s £21 billion energy assistance plan includes a £150 council tax rebate in the month of April for most households and a £200 energy bill cut in the month of October, both of which must be returned over five years.
The administration has stated that it intends to develop an energy supply strategy that will “supercharge the renewable energy and nuclear capacity” while also “lowering energy costs.”
