Rising energy bills to 'devastate' poorest families

New analysis from the Joseph Rowntree Foundation finds households on low incomes will be spending on average 18 per cent of their income after housing costs on energy bills after April.

The analysis compares the household spend on gas and electricity bills of several different family types on low and middle incomes between 2019-20 and after the increase in April this year.

For single adult households on low incomes this rises to a shocking 54 per cent, an increase of 21 percentage points since 2019/20. Lone parents and couples without children will spend around a quarter of their incomes on energy bills, an increase of almost 10 percentage points in the same period.

While there is little difference in the overall increase in bills from April, with all households facing an immediate increase of between around 40 per cent and 47 per cent, the difference in the proportion of household incomes these increases will represent is stark. Middle-income households will be spending on average six per cent of their incomes on energy bills, and no more than eight per cent for any family type considered.

Meanwhile, the charity’s flagship state-of-the-nation report has revealed a worrying increase in the number of children growing up in very deep poverty. Approximately 1.8 million children are growing up in very deep poverty, meaning the household’s income is so low that it is completely inadequate to cover the basics. This represents an increase of half a million children between 2011-12 and 2019-20.

The JRF is calling for an immediate emergency payment for people on the lowest incomes to help prevent hardship in the months ahead.

Katie Schmuecker at JRF said: “The reality for many families is that too many children know the constant struggle of poverty. The fact that more children are in poverty and sinking deeper into poverty should shame us all. The case for targeted support to help people on the lowest incomes could not be clearer. But this must go hand in hand with urgent action to strengthen our social security system, which was woefully inadequate even before living costs began to rise.

“Our basic rate of benefits is at its lowest real rate for 30 years and this is causing avoidable hardship. The government must do the right thing and strengthen this vital public service. Rising energy prices will affect everyone, but our analysis shows they have the potential to devastate the budgets of families on the lowest incomes. The government cannot stand by and allow the rising cost of living to knock people off their feet.”