Energy bills ‘greatly outstrip pay increases’

Rising energy bills may mean people struggling to pay off credit card debt find it increasingly difficult.

A study by price comparison site uSwitch has found the cost of heating the home has risen five times faster than household income since 2004.

Eight years ago, the typical utility subscriber had to pay £522 a year for energy, but this is now £1,252 – a 140 per cent increase – compared to a 20 per cent rise for income.

It means that the average home now spends 3.2 per cent of its income on energy,a significant increase on 1.6 per cent in 2004. The annual bill is now worth 11 per cent of the state pension, automatically putting old people with no other income into fuel poverty.

And the site found 90 per cent of Britons are worried about rising fuel bills, making it a greater concern than increasing food prices (77 per cent).

Food and fuel prices are the main reason higher inflation is hitting poorer people more than the rich, a Trades Union Congress study indicated last week.

By James Francis