A third of Brits face poverty with energy bills set to hit $5,000 | CNN Business

CNN Business

Almost a third of households in the United Kingdom will face poverty this winter after paying Energy bills They are due to rise again in January, say campaigners.

According to estimates by the End Fuel Poverty Coalition, about 10.5 million households will be in fuel poverty in the first three months of next year. (EFPC) Published on Tuesday – means their income will fall below the poverty line after paying for energy.

The UK government defines poverty as a household income below 60% of the UK median, which according to official figures was £31,000 ($37,500) in 2021.

The estimates are based on new forecasts from research firm Cornwall Insight, also published on Tuesday, which show that the average household energy bill is expected to reach £3,582 ($4,335) from October and £4,266 ($5,163) from January – about £355 ($430) a month. .

The January forecast shows a 116% increase in energy bills from current levels. Forecasts are struggling to keep pace as fuel prices rise. Just last week, Cornwall Insight predicted January prices to rise by 83% from current levels.

The research firm said it revised its figures due to a jump in wholesale prices and a change in the way the UK regulator calculates its price cap. But relief may be on the horizon: Cornwall Insight expects bills to start falling in late 2023.

A crunch in global natural gas supplies pushed up fuel bills last year Wholesale prices to record levels. Russia’s invasion of Ukraine in late February has further aggravated the situation.

average UK The household bill has already increased by 54% this year, leading to a The cost of living crisis which led many Britons to “heating and eating.”

In May, the government announced a £15 billion ($18 billion) support package – including payments of £400 ($484) to 29 million households from October – to ease the burden of energy bills.

But EFPC co-ordinator Simon Francis said the latest prices meant the government’s current level. The amount of support is a “drop in the ocean”.

Craig Lowrey, principal consultant at Cornwall Insight, said in Tuesday’s press release that if “£400 wasn’t enough. [the company’s] The earlier estimate, it is no longer sufficient.”

Liz Truss, UK Foreign Secretary and current Frontrunner to replace Boris Johnson As Prime Minister next month, he has proposed tax cuts to help people struggling to pay their bills, rather than direct aid. Her rival, former finance minister Rishi Sunak, has said more support will be needed.

Meanwhile, the CBI – the country’s top trade body – has urged Johnson to bring leadership candidates together to agree on a way to support households and businesses with their energy bills so that measures can be announced as soon as the October price cap is set. August 26. A new prime minister is not expected to be elected until September 5.

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