Cost of essential bills has risen faster than average wages
08 June 2016
Brits’ budgets continue to feel the squeeze, with regular household bills having increased by 20 per cent since 2007, according to the Bacs Bill Tracker.
The Tracker, created by Bacs Payment Schemes Limited (Bacs), the people behind Direct Debit in the UK, shows that by the end of Q1 2016 the average amount paid out by households in the UK to cover essential bills had grown to £674. This is up from £562 in March 2007 and represents an increase of 20 per cent, or £112 per month, equating to a hefty annual rise of £1340.
Unfortunately for bill payers, average wage levels have failed to keep pace with these increases. In fact, over the period between 2007 and 2015, data from the Office for National Statistics (ONS) shows that average wages grew by 12.4 per cent in comparison.
The Bacs Bill Tracker data is drawn from 100 million actual anonymised monthly transactions processed by Bacs as householders use Direct Debits to pay for their essential household bills, including energy, water, mortgages and rent, council tax, broadband and phone, TV licensing, and household insurances. It does not include elective personal bills such as gym memberships or mobile phone payments.
Mike Hutchinson, from Bacs, said:
“These latest figures reflect the financial burden being faced as the cost of household bills increases steadily, while wages fail to keep pace. With 73 per cent of regular household bills paid by Direct Debit, this data gives a clear indication of the upward financial pressures across a basket of core bills. Splitting costs across the year could relieve some of the strain on hard-pressed family budgets and, with the discounts offered from many billers and service providers for paying by Direct Debit, there’s an opportunity to save some vital pounds.”