A predicted £47 average rise in energy bills – following an increase this week – comes on top of confirmed uplifts in the cost of council tax, water and a TV licence
Millions of households face at least a £240 a year jump in their must-pay bills from this April.
A predicted £47 average rise in energy bills – following an increase this week – comes on top of confirmed uplifts in the cost of council tax, water and a TV licence. Mobile phone and broadband charges are also set to rise, along with regulated train fares from March. The combined whammy will hammer families still battling to make ends meet. Many retailers and other firms have also threatened to raise prices to pass on a hike in employers’ national insurance from the start of April.
Regulator Ofgem’s energy price cap increased by an average 1.2% to £1,738 per year for a typical household from January 1, on top of a near 10% jump in October. And industry experts Cornwall Insight has predicted the cap would rise again in April by another 3% – or £47 – to £1,785 a year. Water regulator Ofwat last month announced that a typical water bill will rise by an average of £86 a year from April.
At the same time, council tax bills in England are set to rise by up to 5% – more than £100 – and the cost of a TV licence by £5 to £174.50. Mobile and broadband prices are expected to increase in April. Ofcom has banned broadband providers from linking annual price hikes to inflation, so new customers may start to see a fixed yearly increases when they sign-up for a contract instead. Train fares will rises even sooner, with regulated ticket prices set to increase by 4.6% in March.
On the other hand, millions of workers will benefit from an increase in the National Living Wage from the spring. The rate for those aged 21 and over will go up by 77p an hour to £12.21. Meanwhile, inflation-linked state benefits will go up by 1.7% from April, and the state pension by 4.1% due to the government’s triple lock promise.
And millions of borrowers could be better off if, as expected, the Bank of England announces one or more interest rate cuts in the months ahead. Meanwhile, wages are set to continue rising faster than inflation. Personal finance expert Amy Knight, from the website, NerdWallet UK, insisted there were ways households could take some of the sting out of planned price rises.
On energy, for instance, she says: “If you’ve been loyal to your provider for years, now could be the time to switch if a rival company has a more competitive offer. Compare fixed rate energy deals, which lock in your costs for a set time, protecting you against further price hikes during that period, but check for exit fees, which could potentially cancel out any savings if you decided to leave the contract early.”
And on water, she says: “Contact your water provider to find out if you’re eligible for a social tariff, which offers discounted rates for lower-income households . You may be able to reduce your consumption by installing water-saving devices such as flow-limiting taps and shower heads.”
