The three main reasons the cost of living crisis is getting worse

·3-min read
BRISTOL, UNITED KINGDOM - JANUARY 22: In this photo illustration Sterling British Pound GBP bank notes and coins are arranged, on January 22, 2022 in Bristol, England. The UK is currently facing a cost of living crisis, as inflation hits a near-30-year high and rising energy bills will squeeze household incomes still further. To add to the misery, many UK households face a further rises in home energy prices when the energy price cap is likely to be raised in April.  (Photo by Matt Cardy/Getty Images)
The UK is currently facing a cost of living crisis. (Getty)

The price of groceries, soaring energy bills and expensive fuel are the three main factors Brits have warned is driving up their cost of living.

The Office for National Statistics says 66% of adults feel their cost of living has increased in the past month, with just under a third adding they were cutting back on gas and electricity.

More than half are spending less on non-essentials, while a quarter are dipping into savings.

Watch: Cost of living: One in five cutting back on gas and electricity use amid inflation squeeze

Of those who said their cost of living had gone up, 87% said the food they bought was more expensive, followed by 79% who said their gas or electricity bills were higher and 71% who said fuel prices had jumped.

The data offers a glimpse of the cost of living crisis, which will only worsen in April with some charities warning the impact on millions could be catastrophic.

Food, fuel bills and petrol are hitting households hard.
Food, fuel bills and petrol are hitting households hard.

A surge in global energy prices has pushed inflation to a 30-year high of 5.4% - mirroring sharp rises in price growth in many other countries - and the Bank of England is expected to raise interest rates for a second time in two months on Thursday.

Domestic fuel prices are expected to jump by a further 50% when a twice-yearly review of regulated tariffs takes effect in April, just as higher social security contributions are due to take an additional chunk out of household budgets.

The 1.25 percentage point national insurance increase from April is expected to raise £12 billion a year for health and social care services but breaks prime minister Boris Johnson’s 2019 election manifesto commitment not to raise taxes.

Read more: One in five cutting back on gas and electricity use amid inflation squeeze

Despite pleas from MPs for action, Chancellor Rishi Sunak has remained tight-lipped over any new policies to help people through the cost of living crisis.

Speaking at Treasury questions, he told MPs he is “aware of people’s anxieties” and he will continue to “look at all the policies we have in place” to ensure support is being offered in the “best way possible” in the coming months.

But Sunak stopped short of offering anything concrete on new proposals when challenged in the House of Commons to go further to deal with rising energy and food prices.

File photo dated 21/10/2021 of Rishi Sunak who said it is
Rishi Sunak did not offer anything concrete on new proposals to deal with the cost of living crisis. (Getty)

The SNP accused the Chancellor of being “too distracted by plotting for the prime minister’s job to help those affected by this crisis”.

Sunak is one of the favourites to replace Johnson if he resigns over the “partygate” scandal.

The chancellor's number two, Simon Clarke, also defended the forthcoming national insurance hike by insisting there is “no other responsible way” to pay for NHS improvements.

Read more:

UK's low income households to be worst hit with rising energy prices

Energy price cap set to jump 50% as UK faces ‘years of boom and bust’ pricing

Food bills to rise by around £180 a year, shoppers warned

The ONS said higher power costs were disproportionately hitting people on lower incomes.

Its data showed the poorest 10% of households spent 7% of their disposable income on gas and electricity, compared with 2% for the wealthiest 10% of households.

The ONS's findings were based on a survey of nearly 4,500 people conducted between 6 January and 16 January.

Watch: Cost of living - Supermarket shoppers facing £180 a year increase in average spend