Cost of living crisis: Energy bills set to soar at least 14 times faster than wages

12 March 2022, 00:08 | Updated: 12 March 2022, 00:13

Energy bills are set to soar at least 14 times faster than wages within the next year
Energy bills are set to soar at least 14 times faster than wages within the next year. Picture: Alamy

By Emma Soteriou

Energy bills are set to soar at least 14 times faster than wages within the next year as the cost of living crisis worsens.

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Gas and electricity bills are on course to increase by 54 per cent when the new price cap is set in April, but average weekly wages are expected to only go up by 3.75 per cent, according to an analysis by the TUC.

The union organisation estimated that record high energy prices could wipe out the entire value of pay rises this year.

The TUC added that those on low incomes would be hit hardest due to years of weak wage growth and benefit cuts leaving them "badly exposed" to the cost of living crisis.

It comes as the conflict in Ukraine could result in a futher hike in energy costs, with the Government being urged to come forward with new measures to support struggling families.

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TUC general secretary Frances O'Grady said: "Years of wage stagnation and cuts to social security have left millions badly exposed to sky-high bills.

"With households across Britain pushed to the brink, the Government must do far more to help workers with crippling energy costs.

"That means imposing a windfall tax on oil and gas profits and using the money raised to give hard-pressed families energy grants, not loans.

"It means a real increase to universal credit to stop low-income workers from being pushed into poverty.

"That's the fastest way to get support to families who need it, and it means coming up with a long-term plan to get wages rising across the economy."

Meanwhile, the BRC-NielsenIQ Shop Price Index recently found that retail prices rose in February at their fastest rate in over a decade.

Food inflation remained the key driver behind higher prices, particularly for fresh food, which has been impacted by poor harvests, both in the UK and globally.

However, non-food inflation also accelerated to 1.3 per cent in the same month, up from 0.9 per cent in January, making it the highest rate since September 2011.