Fears are growing that millions more families could be pushed into poverty by the end of the year in the worst cost-of-living crisis since the 1950s. Average outflows will rise by £4,610 a year between now and December, according to new analysis by the Center for Economic and Business Research (CEBR). It means annual household bills will be £6,219 more expensive this December compared to the same period last year. The increases will be even greater for those with larger homes and larger families. The jump is mainly due to utility bills. CEBR expects bills for ‘housing, fuel and electricity’ to be £2,724 more expensive this December than last year. (Stock Photo) Annual household bills are expected to be £6,219 more expensive this December compared to the same period last year Household spending on food and non-alcoholic drinks expected to rise by £821 per year The figures are based on the assumption that watchdog Ofgem’s price cap will rise to £3,359 in October, as analysts at Cornwall Insight had predicted. Meanwhile, household spending on food and soft drinks is expected to jump by £821 a year, while the cost of “miscellaneous goods and services” – which includes everything from insurance premiums to toiletries – is set to rise by £129 . Analysts say “other spending” including mortgage repayments and council tax will rise by £233 in the 12 months to December. If families want the same quality of life as now, they will have to spend £188 more than last year on eating out and £342 more on ‘leisure and culture’. The figures are based on the latest data on the average cost of food and living from the Office for National Statistics, from June. It assumes that an average household is 2.3 people and that families do not change their spending habits during this time. Laura Suter, of investment firm AJ Bell, said: “We have seen a big rise in costs this year but anyone hoping for the worst to be over could be in for a rude awakening. “No one is immune to these terrifying price increases, which will hit every home across the country.” At the same time, the big banks are betraying savers to the tune of £10.4bn a year by failing to pass on rate rises. That doesn’t take into account the Bank of England’s key rate hike this week, meaning the real rate is likely to be even higher.

After a decade of low interest rates, it’s a bitter blow for cash savers. Earlier this week, the bank’s governor, Andrew Bailey, said higher interest rates were being passed on to borrowers much faster than to savers. “It’s important that savers get the refunds they should,” he added. There are around £993.79 billion in easy access accounts, according to Bank of England figures. Most are with big banks. In December, when the prime rate was at a record low of 0.1%, the average savings deal also paid 0.1%. By June, the prime rate had risen to 1.25%. However, at the same time, the standard rate paid to savers had risen to just 0.2%, according to the Bank’s figures. It means savers have lost a potential gain of 1.05 percentage points – worth a total of £10.4bn a year. Even as the key rate jumped on Thursday to 1.75%, most major providers have yet to pass on significant increases to savers. Some banks, including Lloyds and NatWest, increased net interest margins – the difference between what they earn from borrowers and what savers pay – by 10 per cent or more. James Blower, of advisers Savings Guru, said: “It’s a scandal that the big banks have given savers so little.” Barclays said it would raise interest rates on some of its products, but gave no details. Santander and NatWest are also increasing interest rates on some accounts, but to levels well below the rise in base rates.

Electricity theft hits new highs as fuel prices soar

Electricity theft hit record levels last year as soaring bills fueled deadly breaches. Bypassing meters and interfering with supply lines is punishable by up to five years in prison. However, Home Office figures show that police forces in England and Wales received 3,600 reports of “dishonourable use” in the year to March – a 13% increase on 2020-21 and the most since comparable records began in 2012-13. Around 1,100 were from January to March – almost double the number from the same period in 2019-20. Stay Energy Safe, run by Crimestoppers, warned that tampering with a meter could lead to overheating of wires, damage to property and possible loss of life. It said crime costs energy companies at least £440 million a year – the cost is then passed on to customers. Ofgem said that “under no circumstances should consumers attempt to connect their electricity meters themselves”. But campaign group National Energy Action (NEA) said the cost of living crisis was forcing people into “desperate situations”. Peter Smith of the NEA said: “This is not only illegal but also dangerous, and it is frightening if the crisis is forcing households to try this to keep the lights on. And this is happening now, before the winter and the cold hit.’ In May, the NEA predicted that the average annual energy bill from October could reach £2,800. This figure is now expected to reach £3,358. Across the two countries, 57 percent of electricity theft cases closed last year had no suspects identified, while 30 percent were dropped due to evidentiary difficulties. Only 7 percent resulted in an indictment or summons. The government said it was providing £37bn to help households with living costs.