UK

One Third Of Households In The United Kingdom Facing Poverty Due To Rising Energy Costs 

According to campaigners from the United Kingdom, nearly one third of households in the nation will face poverty by the winter due to increasing energy costs and paying bills that are expected to rise in price even further with the new year. 

According to estimates from the End Fuel Poverty Coalition (EFPC), about 10.5 million households will be in “fuel poverty” for the first three months of 2023. In other words, based on their incomes after they’re done paying their energy bills their household income will fall below the poverty line. 

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The definition of poverty in the UK is any household with an income of less than 60% of the UK median, which stands at £31,000 ($37,500), according to official statistics.

Cornwall Insight is the research firm that provided the data leading to the prediction that one third of households will be impoverished in the winter. The average energy bill is expected to hit £3,582 ($4,335) a year from October, and £4,266 ($5,163) from January; about £355 ($430) a month.

The forecast for 2023 represents a 116% increase in energy bills from their current levels. Fuel prices have been surging worldwide, and in the UK prices are projected to continue to rise by 83% in January. 

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Cornwall Insight, however, also is expecting energy bills will start decreasing in the second half of 2023. The average household bill in the UK has risen by 54% this year due to inflation rates regarding fuel and energy consumption.

The UK government announced a bill in May which introduced a  £15 billion ($18 billion) package of support — including a “£400 ($484) payment to 29 million households from October — to ease the burden of energy bills.”

But Simon Francis, coordinator for the EFPC, said “the latest price estimates meant the current level of government support amounted to a drop in the ocean.”

Craig Lowrey, a principal consultant at Cornwall Insight, said in a Tuesday press release that “if £400 was not enough to make a dent in the impact of [the company’s] previous forecast, it most certainly is not enough now.”

Liz Truss, the UK’s foreign minister and as prime minister, has proposed “cutting taxes to help people struggling with their bills, rather than direct help.”