London: The Trades Union Congress (TUC) reported that UK households have paid an average of £13,961 ($18,520) in additional bills since 2021, as rising mortgage repayments, loan costs and utility charges put pressure on family budgets.
The union body stated that the increase amounts to an extra £2,792 ($3,704) a year per household. The findings come ahead of the government’s October 28 budget, with the TUC urging John Healey, Chancellor to introduce measures to ease the cost of living and support household spending.
The analysis of official figures found that the UK had recorded the weakest growth in consumer spending among G7 economies since before the COVID-19 pandemic. The TUC warned that continued pressure on household finances was holding back spending and weighing on economic growth.
Mortgage holders paid an average of £9,034 ($11,984) more in repayments since 2021, equivalent to an additional £1,806 ($2,396) a year. Households with loans have paid a further £1,911 ($2,535) over the same period, or £382 ($507) annually.
Energy and water costs also increased. Households spent an average of £2,644 ($3,507) more on electricity and gas since 2021, adding £529 ($702) a year. Water bills have risen by an average of £372 ($493) over the period, equivalent to £74 ($98) annually.
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The TUC attributed the higher costs to persistent inflation following the pandemic and global shocks linked to conflicts in Ukraine and the Middle East. Rising interest rates also increased pressure on mortgage repayments. Average rental costs risen faster than mortgage costs, raising concerns that higher housing expenses are also affecting tenants.
Healey pledged to give households more financial breathing space in the October budget. However, the Treasury is preparing a tightly focused package amid concerns about borrowing costs and the potential reaction of financial markets. The International Monetary Fund also urged the government to continue efforts to reduce the budget deficit.
Pressure for action is growing as forecasts suggest annual energy bills for a typical household could reach £2,000 ($2,653) from January. The Confederation of British Industry called for lower employer National Insurance contributions, reduced business electricity costs and changes to business rates to encourage investment and employment.
The Institute for Public Policy Research has separately proposed raising £16 billion (approximately $21.22 billion), mainly through higher capital gains tax, alongside measures to support households. Its recommendations include a cap on private rent increases, a £2,000 ($2,653) limit on household energy bills, a fuel duty freeze and higher housing allowance payments for eligible Universal Credit recipients.
General secretary Paul Nowak noted that rising bills were squeezing household budgets and weakening consumer spending, calling for a plan to improve living standards and protect households from energy price shocks.
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