Energy bills: Older Britons will pay more but younger people will struggle the most, report finds | Energy bills

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Seniors face higher income due to soaring energy costs this winter, but younger households are at greater risk of not being able to pay their bills or going into debt amid the energy cost crisis. life, according to a report.

As households across Britain turn on their heating, research from the Resolution Foundation think tank has found that older generations, particularly those over 75, will spend a greater share of their income, spending 5% to 8%, to their energy bills. For those under 50, the proportion is 5%.

But while older households face a bigger increase, it’s the younger generations, who have endured years of stalled wage growth and high rents, who will struggle the most to cope, according to the report.

Even with government support – which includes energy price freezes, a £400 bill rebate and lump sum payments for vulnerable households – the typical household energy bill will be 83% higher this winter than before the cost of living crisis.

“All generations are facing hardship from the growing cost of living crisis – but different generations are experiencing it very differently,” said Molly Broome, an economist at the Resolution Foundation.

“Middle-aged people will face the biggest bill increases and older generations will see the biggest squeeze on their incomes due to their larger, less energy-efficient homes.

“But it is young people who find it hardest to pay rising bills, as they are less likely to have savings to fall back on – and will therefore be forced to rely on older friends or family. , or could go without heating during the coming cold weather.

Younger households are up to four times more likely to have prepayment meters, which prevents them from spreading their energy costs evenly over the year. Nearly a fifth of households headed by a person under the age of 30 pay for gas and electricity, compared to around 5% of households headed by a person aged 65 and over.

While more than 80% of over-65s could use money from their checking account or savings to cover an unexpected expense, less than half of 20- to 29-year-olds could do the same.

Middle-aged households, those headed by someone aged 40-64, will see the biggest cash-flow bill increases, with typical annual energy bills rising by more than £1,000 from levels from before the crisis, to around £2,300. However, this reflects the fact that these households tend to be larger.

With so many households struggling to make ends meet, the Living Wage Foundation campaign group has renewed its calls for businesses to pay higher hourly wages. He is also waiting to see whether the government will raise the statutory minimum wage, now £9.50 for adults aged 23 and over, in next week’s autumn statement.

The voluntary living wage is set at £10.90 in the UK and £11.95 in London. The organization said giving low-paid workers a raise would help tackle in-work poverty and also help reinvigorate the struggling economy with a boost worth £1.7billion.

“With the cost of living rising, it’s never been more important for employers who can to step in and provide cost-of-living pay,” said Katherine Chapman, director of the Living Wage Foundation.

“By doing so, they will not only provide security and stability to their workforce, but they will also boost the local economy.”

theguardian

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