Did you follow the Chancellor’s Autumn Statement yesterday? What do the plans mean for you and the challenge of dealing with the rising cost of living? Here’s the Which? digest of the key announcements…
The good news is that consumers are feeling more confident about the economy: more people than not now think that it will improve over the next year.
But this positive mood is not yet translating into a positive impact on people’s living standards.
There’s no doubt that the figures on economic recovery are good news for the country, and millions of consumers struggling with the cost of living will welcome steps to relieve some of the pressure of rising energy bills, rail fares and fuel. But, as the Chancellor himself said, the job is not yet done.
The challenge for the Government over the coming months will be to ensure that the growth in the economy gets through to people’s pockets.
The burden of household bills
With this in mind, it is unsurprising that our latest survey showed that just one in six people thought that the recovery had fed through into their living standards. So the news that, if passed on to bills, investment in infrastructure could amount to at least £740 per household each year until 2020, won’t do much to change that.
There is clearly a real worry that – as we’ve seen with energy – consumers may struggle to cope if too much of the burden of increased investment is also passed through to their transport, water, insurance and communications bills.
We also need to keep in mind the increasing costs of other essentials and the combined impact this is having on household budgets as incomes continue to be squeezed. So it is encouraging that the Government has said it will keep costs in check. Ministers’ words must be turned into firm actions, particularly for households already struggling to make ends meet.
Words must turn into actions
Although widely debated, the reduction in energy bills is to be welcomed and follows our ‘Cut them down, George’ campaign, which was backed by more than 40,000 people.
The decision to refocus the Energy Company Obligation (ECO) is right but the energy suppliers must now commit to greater transparency and to getting their costs down, fast.
Many will also welcome the commitment to £1,000 towards energy efficiency measures when moving home, but an urgent radical overhaul of the Government’s approach to energy efficiency overall is still needed.
Hard pressed consumers will welcome an average £50 back in their pockets, but more needs to be done to look at how these costs can be kept in check in the longer-term. We must also see a wider reform of the market to make it truly competitive.
But addressing energy bills alone won’t be enough to tackle that fact that nearly four in 10 are still feeling the squeeze.
Fuel, phones and fares
Scrapping the next planned rise in fuel duty was expected and delivered and will offer some comfort to the eight in ten worried about fuel prices. They may also be heartened by the announcement that they will be able to pay for their car tax by monthly direct debit from October 2014.
On telecoms, Wednesday’s news that bill shock when a mobile phone is stolen will be limited by capping a victim’s liability at £50 is also welcome. And we campaigned against price rises on fixed contracts so it’s great that people can now switch without being stung by unfair exit fees. However, the Government must now also act on plans to scrap EU mobile roaming charges to end uncertainty about using mobiles overseas.
On train fares, the Chancellor has committed to limiting average increases to the Retail Price Index in 2014 rather than 1% above, as was originally planned. This is good news for thousands of commuters across the country.
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