UK Household Spending Crippled by Energy Bills

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By Shane Croucher | December 5, 2012 1:39 AM EST

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Fuel and power spending by UK households has soared by 12 percent from between 2006 and 2011 (Reuters)

Bloating fuel bills drained household finances across the country as Britons made financial cutbacks across all other spending just to keep their homes lit and warm, according to official figures.

Britain's households spent an average of £483.60 a week in 2011, reported the Office for National Statistics (ONS), a figure that has fallen every year since 2006 when it was £541.20.

Spending on fuel and power bills soared by 12 percent, pushed up by volatile energy prices in a period that saw the cost of a barrel of Brent crude oil hit its most expensive ever.

It was the only sub-category of household spending to see a rise.

UK household spending: The percentage difference in spending by sub-category between 2006 and 2011 (ONS/IBT)

The data comes from the ONS Family Spending 2012 report, which adjusts prices in accordance with 2011's RPI numbers.

In 2008 the financial crisis triggered a domestic recession, and the economy is still in a painful downturn as it struggles to recover.

Recession-weary consumers, fearful for their jobs and hit by a high cost of living as well as stagnant wage growth, held back on spending to shore themselves up against any unforeseen personal financial disasters.

Other expenditure items, which the ONS said includes non-consumption spending such as mortgage protection premiums and council tax, fell by just over 24 percent, possibly suggesting people are opting to go without insurance or were newly receiving state support for certain bills.

Household goods and services spending saw the second biggest drop at slightly under 24 percent, while clothing and footwear outgoings came in third with a 21 percent plunge.

Food and drink, education, and leisure spending were all cut back between 2006 and 2011.
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