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Cheers for the Chancellor or still feeling the squeeze?

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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.

Comments
Member

“What do the plans mean for you” Simple, expect zero assistance from the government and look after my own finances. And tighten my belt even more cos things are only getting more expensive.

“Hard pressed consumers will welcome an average £50” I’ve just done a quick check on which switch and not one of the big six have tariffs better than the one I’m already on , so I’m not expecting to see that £50. Only co-op and one I’ve never heard of had better tariffs but not a big enough of a saving to bother switching. (FYI that was £30 for the year). I’m fixed until 2015.

Member

I’m still feeling the squeeze – The only reason I don’t use food banks is because I own my own home

Member
Aisha says:
6 December 2013

I dont think any of these changes will make things any better for me financially

Member
Richard says:
6 December 2013

Do I sense that there may be an election due? Typical of this government that they think by talking up a “recovery” the rest of us will believe it. Apart from the already wealthy the rest of us will continue to pay for the great profits to be made by the utility companies and banks. I keep hoping that we will see a revolution that will reverse this disgusting exploitation.

Member
Organised says:
6 December 2013

So the basic state pension is rising from £110.15 per week to £113.10 per week, supposedly in line with the September CPI of 2.7%. I say supposedly because an increase of 2.7% would mean a new figure of £113.12, not £113.10. Increasing the basic state pension to £113.10 means an underpayment of 2p per week = £1.04 for the year. Multiply that by the number of people receiving the basic state pension (over 1m) and the result is the Government saves at least £1m over the year! That £1m should be in pensioners’ pockets, not the Government’s.

Member
Steve R says:
7 December 2013

The chancellor says that its fair that people should expect to spend a third of their adult life retired. Well I keep doing the sums and I must be missing something, I will retire at 66 in 2022, the life expectancy for me as a male is 79, so with luck that gives me 13 years. I’ll be generous and take a start work date when I was 18 (I actually left school before I was 16 and have been in full employment since), therefore by 2022 I will have worked a total of 48 years. I cant quite work out how the predicted 13 years can be a third of my adult life, I reckon I’ll have to live to 90 to be retired a third of my adult life. Bring it on, although I’m not sure the kids will be as happy they will have to wait another 11 years for their inheritance 🙂

Member

my husband had only 13 years of retirement after starting work at 15 I now get almost his pension but after taking away the marriage allowance gov’t still saves money from his pension. The main problem seems to be that the money received goes into general funds instead of being invested for future payments , so we have to have mass immigration of workers so that the NIC payments will pay for the pensions, as far as the shortage of increase goes if future Governments continue the shortage and that of course will be a percentage of the shorter payment in the previous years after 10 years just think of the saving not just £1.04 per year but after 10 years would be an exponential lncrease of millions. the financiers in England received an average £45 million increase when bonuses were taken into consideration and Britain voted not to control the over 2,500 Bankers etc. earning over 1 million euros per year, Germany has about 160 and so does France the whole of the EU outside of Britain has I believe about 1,760 shows where the Tories loyalties lie!

Member

Wages squeezed – Welfare capped – House prices rising ten times faster than incomes – Consumers spending on borrowing – Household debt £1.43 trillion – Each household currently owing £28,489 – Hardworking families not benefiting from economy growth.
MP’s INCOME INCREASED 11% IN 2015!!! ! (Source BBC)

What does this tell you about a Society???

Member
Colin says:
8 December 2013

We are all struggling except MP’s. they getting an 11% pay rise who else can say they getting that?? Use your vote and get this lot out!!