"My bills are just spiralling out of control"

Joanna Young, Research and Campaigns Lead, Citizens Advice North Lancashire

Along with other charities across the country, we anxiously awaited the Chancellor's announcements today, hoping that it would bring some good news for those in our community who are living on the lowest incomes.

The energy price cap is being lifted in April, which will increase the cost of utility bills by an average of £693 per year. This increase in energy costs comes on top of the reduction to Universal Credit by £20 per week, implemented in October 2021. As well as this, National Insurance is due to go up by 1.25 percentage points from the first of April.

We have been seeing examples of clients who are really starting to struggle with the cost of living, and we know that inflation is biting for those on the lowest incomes who spend a disproportionate amount of money on fuel and food. Officially, inflation is now at 6.2% but it is predicted to average 7.4% this year - which is a huge increase, and higher than it has been for 40 years.

For example, we spoke to Client A recently whose income was £1200 per month. Their rent is around £600 and their electricity bill for January was £612. When bills are this high, unless there is a technical error, it becomes very difficult to know how to advise clients, as sometimes there isn't much we can do. We supported Client A to access help from the Household Support Fund, but they aren't sure what to do next month, or the month after that.

Another example is that of Client V, a pensioner in his late eighties who came to see us due to a sharp increase in his energy bills. We worked out that the rise in cost was 143%! We investigated this with the client and contacted the utility company, but it wasn't a mistake - the client's tariff had come to an end and the new one was much, much higher. This client was having to use his savings to cover the cost of his bills and was very worried about what will do when the price cap is lifted again in October 2022.

Client M is a single parent with three children under 16. She isn't very well, and so she can't work at the moment. She moved house to a smaller property to save money, and contacted us when her first bill came in, as it's much higher than at her old house at £140 per month which is 41% of her Universal Credit standard element. She received support this month from the British Gas fund, but she's worried about what she'll do next month, and the one after that as she doesn't have enough money in benefits to cover rent, bills and food.

Client T came to us this morning, asking for a foodbank voucher. He said: "My bills are just spiraling out of control". He doesn't know what to do - he just doesn't have enough money to cover the basics.

Our advisers are skilled and experienced - and in some cases they are despairing when there is literally nothing we can do to help clients, whose budgets just don't stretch to cover the basic essentials of life. We hoped that the Chancellor would take the opportunity today to increase benefits by more than 3.1%, but he didn't take it.

Mr Sunak has put another £500bn into the Household Support Fund today, which is likely to mean about £300,000 - £400,000 for Lancaster City Council District (which includes Morecambe, Carnforth, Heysham and the surrounding villages). The fund, administered by the City Council is well run by a capable and caring team at the Town Hall, but not everyone is aware of it, and the money would have been better directed via the benefits system where we know it will reach those on the lowest incomes.

The raising of the NI Threshold is welcome for those on lower incomes, but it doesn't make a difference to those people who can't work. People who are sick or disabled (and who form 60% of our clients) often describe feeling invisible in society. This budget confirms a lack of care or concern for those who, for whatever reason, can't work, and it lionises work as solving all problems - but not everyone is able to work.

We believe that everyone should be able to afford the basics such as shelter, heat and food, regardless of their circumstances. We hope that the Chancellor will still change course and provide targeted, effective support to those on the lowest incomes as we live through the worst Cost of Living Crisis in decades.

What can you do if you're worried about the Cost of Living?

Citizens Advice nationally is breaking unwelcome records with more people seeking help in February 2021 than ever before. Our service is extremely busy, so if you're worried about the cost of living there are a few things it may be helpful to check first before calling us. 

Firstly, have you got a household budget? There is a great budgeting tool freely available on the Citizens Advice website which you can find here: https://www.citizensadvice.org.uk/debt-and-money/budgeting/budgeting/work-out-your-budget/ 

Secondly, could you be eligible for benefits? There are over 1.3m people in the UK who could be claiming Universal Credit, (which you can get even if you are working) - but don't. Try https://www.entitledto.co.uk/ or https://www.turn2us.org.uk/ so you can see if there is any help you might be entitled to.

The City Council in Lancaster administers the Household Support Fund which you can find out about here: https://www.lancaster.gov.uk/sites/community-hub/household-support-fund - you don't have to be on benefits to get help.

If you have children, are you getting Healthy Start Vouchers, Child Benefit, Free School Meals or if you have recently had a baby have you applied for a Sure Start Maternity Grant? You can find out more here: https://www.gov.uk/sure-start-maternity-grant 

If you are worried about bills, contact your utility provider and talk to them about it, especially if you are getting into debt. Many energy providers have funds to help people who are struggling, and the debt won't  go away, so try to negotiate with suppliers and if you are worried, you can contact us for support and our debt advisers can help you. If you are unwell or have small children, ask your provider about being put onto the Priority Service Register and let them know, as they can't cut off your supply if you are vulnerable or suffering financial distress.

If you're not confident filling in forms, or confused, then give us a ring and we will help.

You can call us free and in confidence on 0808 278 7882 or you can get advice by email at enquiries@northlancashirecab.org.uk. We can arrange a face to face appointment with you if you need one and we have translators available.