Prices are rising across the board. Food prices are rising at their fastest pace for over 5 years.
A Wave of price rises is hitting the consumer.
It is not only food prices that are rising. Consumers are facing a raft of price rises. The extra costs amount to an extra £240 on household budgets, according to one finance website. This puts the total increase cost at £4.5billion.
Energy bills have risen around £117 a year.
Average council tax bills have increased by as much as 4.5%, around £75.60 a year.
Prescription costs are up by 20p or 2.27% to £9.
NHS dental checkup charges up by 5% or £1.10 to £22.70
TV licences have gone up by £4 to £154.50.
Postage stamps, a rise from 67p to 70p for first class and 58p to 60p for second class.
Minimum wage to rise.
The legal minimum wage will rise by 4.9% from £7.83 to £8.21 an hour.
The real living wage is to rise from £8.75 to £9 an hour, while the London rate will be rising from £10.20 to £10.55 an hour. This is a pay rise of 2.9%, and 3.4% for London workers.
For low paid workers on minimum wage, the increase will be worth an extra £690 full time over a year. It will affect about 1.6 million people over the age of 25.
Whilst this is good news, price hikes and inflation are outpacing wages. For households on low incomes, budgets are increasingly tight.
Household bills are rising faster than wages.
Take energy bills. These will rise by 10% over the next year as the energy regulator Ofgem’s new higher price cap comes into force. This is will affect about 11m households.
The controversial price ceiling, which only came into existence four months ago, has been raised to an average of £1,254. This will wipe out the promised savings when ministers launched the government cap just 4 months ago.
Households will pay an extra £1.4billion. It affects those customers with dual gas and electricity on the most expensive standard variable tariff . This the default deal that users are moved on to when they come off a fixed-term tariff. It also affects those who have never switched supplier. Older users, in particular, tend not to switch supplier so will remain on these more expensive deals.
Many people believed it was the total bill that was capped. This is not the case, it is the unit price that is capped. All the big energy companies have increased their prices up to the new cap.
The regulator Ofgem defended the increases blaming higher wholesale costs and other charges.
However, the UK’s eighth biggest energy supplier, Bulb, lowered its average prices to £1,000 days after Ofgem announced its cap increase. If you stay with one of the big companies who have increased their prices, the average three-bed household will pay £1,254 a year to heat and light their home – up from the old cap of £1,137.
There is also a rise of £106 a year to £1,242 for 4m households on prepayment meters, who are typically more vulnerable customers.
Food prices rising faster than they have for over 5 years
One retail consortium Chief Executive says”
“The bigger threat to food inflation remains the risks of a chaotic no-deal Brexit, which would lead to higher prices and less choice on the shelves.”
Some of the rises come following the effect of last year’s extreme weather and global cereal cost increases.
This has resulted in shoppers now seeing significant price increases for a number of UK crops such as onions, potatoes, and cabbage. Farmers struggled last year with the effects of the ‘Beast from the East’ in the earlier part of the year and the summer heatwave.
Rises in global cereal prices had pushed up the cost of bread and cereal, according to the BRC-Nielsen Shop Price Index. The increases saw food inflation to rise by 2.5% in March. Up from 1.6% in February. The highest inflation rate since November 2013.
Overall, shop price inflation accelerated to 0.9% in March from 0.7% in February. The highest inflation rate since March 2013.
Fresh food inflation rose to 1.9% in March from 1.7% in February. Ambient food prices increased by 3.4%, a significant jump from February’s rate of 1.5%.
Chief executive of the British Retail Consortium (BRC) Helen Dickinson said:
“March saw shop price inflation rise to its highest level in six years, driven primarily by a sharp spike in non-perishable food inflation.’
“Increases in global commodity prices and adverse weather events put upward pressures on the wholesale prices of many foodstuffs which, coupled with rises in the cost of alcoholic and non-alcoholic beverages, pushed food inflation from 1.6 percent in February to 2.5% in March.”
“Nonetheless, the bigger threat to food inflation remains the risks of a chaotic no-deal Brexit, which would lead to higher prices and less choice on the shelves. In order to avoid this scenario, parliamentarians from all parties must find a compromise that can command a majority in the House of Commons.”
Mike Watkins, head of retailer and business insight at Nielsen, said:
“The upwards pressure on pricing continues across food retailing and a key driver this month was inflation in ambient food and drink. With shoppers looking to stretch their budget for the weekly grocery shop, this will not help volume growth, which has been slowing since the start of the year.”
“For many high street fashion, home and outdoor retailers prices are not increasing, so good news for shoppers as the end of season ranges sell through.”
Households are already struggling with everyday costs. Rising prices will mean more households struggling to make ends meet.
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