Energy price cap rise is “a hammer blow to family budgets”

TUC – energy price cap rise is “a hammer blow to family budgets”

• New analysis shows that energy bills will rise 35 faster than wages in the final quarter of this year
• Union body calls for “catastrophic” price rises to be cancelled
• Government is “missing in action at worst possible time”, says TUC

The TUC has today (Friday) warned that the rise in the energy price cap will be a “hammer blow to family budgets” that will push millions into fuel poverty.

New snap analysis from the union body shows that energy bills are now on course to rise 35 faster than wages and 57 times faster than benefits over the final quarter of this year.

Wiping out pay rises

The analysis also shows how record-high energy prices are wiping out the value of pay rises.

Between October 2021 and October 2022, average nominal wages are set to increase by £1,470 per year. But over the same period energy bills are set to increase by £2,270 per year – leaving workers with a net loss of £800.

TUC General Secretary Frances O’Grady said:

“Nobody should have to worry about heating their homes this winter.

“But millions are facing bankrupting bills in the months ahead.

“Today’s energy price rise will be hammer blow to family budgets and tip many households into fuel poverty.

“Ministers must immediately cancel this catastrophic increase. This is the worst possible time for the government to go missing in action.

“And to make sure energy remains affordable to everyone, they should bring the energy retail companies into public ownership.”

On the need to get wages rising, Frances added:

“This living standards emergency hasn’t come out of the blue. It’s been caused by years of wages not keeping pace with inflation.

“If we don’t pay packets rising across the economy, working people will just keep lurching from crisis to crisis.”

The TUC says that the government should set out a programme to make UK living standards more resilient and the UK economy more resistant to a future crisis. This should include:

• Cancelling the October energy price hike for families and providing financial support for essential public services being crippled by rising bills, such as schools and hospitals.
• Rapid rollout of home energy efficiency and taking the energy retail companies into public ownership.
• A plan to get pay rising for all workers – including stronger pay bargaining rights so that working people and their unions can make fair pay agreements across whole industries.
• Increase the minimum wage to £15 an hour as soon as possible – by returning the UK to normal wage growth and having a more ambitious minimum wage target.
• Social security that prevents poverty - universal credit and benefits should be raised to 80 percent of the national living wage, along with a significant boost to support for families with children.