Nearly seven million people say they have “nothing left” to cut back on in the face of a looming wave of crippling energy price hikes, research has revealed.
The number warning that they have no financial slack rose to more than one in four among low-income households. In Scotland, just 52% were confident that they could maintain their “current lifestyle” in the coming year- compared with 56% across Britain.
Millions of households are already in the grip of the ongoing cost-of-living-crisis following a surge in energy, food and fuel prices. Experts warn that the situation is set to worsen, with inflation predicted to still rise from its 40-year-high of more than nine per cent to 12% in the autumn.
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According to the Daily Record, one of main reasons is energy costs, with a price cap set by the regulator Ofgem forecast to rocket from £1971 a year to more than £3500 in October.
Scottish Labour’s finance spokesperson Daniel Johnson said: “This cost of living crisis has already pushed too many Scots to the edge. They desperately need a coordinated, meaningful plan from Westminster and Holyrood to deliver more support.
“But the SNP and the Tories are playing constitutional games while people struggle to heat their homes. Voters will not forget this game playing – especially when they could act to bring down bills and raise support now.”
SNP MSP Rona Mackay said: “People across Scotland need support now but they are left suffering as the Tories refuse to act in any meaningful way – including both woeful contenders to be the next prime minister, who have been disgracefully silent on the Tory-made cost-of-living crisis.
"With an increasingly out of touch and callous Westminster government refusing to step up, the only way for households in Scotland to have a chance of receiving the proper support they need is by seizing the opportunities of independence to create a wealthier, fairer and more equal country.”
The sobering numbers emerged from a report from financial services giant Legal and General. L$G found that 13% of those asked- which equates to 6.9 million people- felt they would have “nothing left to cut back on” in the face of the future energy price increase.
That figure jumped to 28% of people in households with incomes less than £20,000 a year. The research also found that 69% of people are already being forced to make cutbacks on their household budgets.
Just under half were concerned about being able to keep up with rent or mortgage payments. This comes as the Bank of England is predicted to raise interest rates from 1.25% to 1.75% this week.
If so, it would be the first time the bank has upped interest by half a percent since it was granted independence 25 years ago. The bank is under pressure to increase borrowing costs to try and cool inflation.
Nigel Wilson, chief executive at L&G, said: “Many households across the UK are facing very tough financial choices.
“For some, those choices seem impossible.”
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