Despite the Government painting a picture of a sustained economic recovery, 74% of Brits are not feeling the benefit in their own financial situation, according to a survey by uSwitch.com of almost 4,000 consumers after yesterday’s Budget announcement.
54% of consumers say they have seen a fall in their general standard of living over the last 12 months, with eight in ten (83%) witnessing an increase in essential household bills. To cope, over half (53%) are reducing the amount they spend on food, 63% have cut down on heating and hot water while one quarter (23%) have even cut back on essential healthcare, such as dentist appointments and prescriptions. In fact, the vast majority of consumers (70%) feel worse off now than they did in 2010.
The Chancellor may have announced the biggest overhaul to pensions and ISAs for a generation, but two thirds of consumers (66%) still don’t think that he understands the financial fears of ordinary people. Furthermore, 62% don’t trust the Government to make the best decisions for their financial future.
Changes to pensions in the Budget proved popular with 65% of Brits and the creation of a ‘NISA’ with an annual limit of £15,000 was hailed by 66% of consumers. Yet these ‘goodwill’ measures haven’t proved enough to win over the nation, with four in ten Brits now feeling more concerned about their finances following the Budget. What’s more, two in three households (66%) say they would need an additional £220 a month to ease the pressure on their finances and help them stay afloat.
Consumers say that the cost of energy is the biggest issue that the Budget failed to address, with 36% feeling indifferent towards the carbon floor freeze, that will save households £15 a year. Many also feel that the Chancellor should have tackled banker bonuses (63%), care for the elderly (56%) and payday loans (52%).
Jafar Hassan, personal finance spokesperson at uSwitch.com, said: “The Budget may have gone some way to appease pensioners and savers but ultimately it didn’t go far enough to address the rising cost of living. Soaring household bills coupled with inadequate pay rises has left a burning hole in our pockets. Consumers have been left hoping for the best, but planning for the worst.
“The biggest issue concerning people right now is the high cost of energy, and it’s clear that the Budget did not go far enough to address this. It is now vitally important that the Government looks carefully, through its competition test, at how to make the energy market work better for consumers.
“The reality is that in the last year, the cost of living has soared to such a level that, coupled with poor salary increases, families are being forced to jeopardise their health and wellbeing just to make ends meet. However, consumers shouldn’t lose all hope as there are always things they can do to improve their finances, no matter how small. Households should use this year’s Budget as an opportunity to review their own finances to ensure they’re paying no more than they need to on essential bills.”
