We respond to the 2023 Spring Budget

The Chancellor, Jeremy Hunt, announced his new budget today. Here is our reaction to the measures.

What is Citizens Advice seeing at the moment?

• In January 2023 Citizens Advice helped three people every minute with crisis support - this is the highest rate we've ever seen.

• We have many people coming to us who can't afford their bills. Across the country, the National Energy Association estimates that 40% of UK households are technically in fuel poverty as they are spending over 10% of their income on fuel.

What do we think of the budget?

• We welcome some of the measures in the budget but the context of it is the largest two year fall in living standards since records began. Vast numbers of people are struggling to afford essential bills

• We welcome the measure that will see prepayment meter customers being charged the same as those paying by direct debit - this has been iniquitous for a long time

• We welcome the extension of the Energy Price guarantee which will limit bills at £2500 for an average household - but it's important to realise just how high these costs are to previous years and how many people are struggling. At Citizens Advice North Lancashire we saw an 855% increase in people asking for help with fuel bills from Nov 2021 - Nov 2022

The purple line above shows the percentage increase in clients seeking help with energy bills from Nov 21 - Nov 22. The brown line shows charitable help, which means food parcels and hardship fund applications.

• The extension of childcare is welcome - support for working parents is important but places must be properly funded so that poorer areas have the same provision as richer ones.

• Paying upfront childcare costs to Universal Credit is hugely welcome but we hope that the DWP won't force parents into work or sanction them if the childcare places aren't there - it will take time for this measure to filter through so it's critical that childcare is available, especially in rural areas, before sanctions or conditions are applied to benefit claimants.

• The pensions cap being lifted is welcome, and important for many doctors. With the NHS experiencing so much pressure this is very welcome if it keeps more medics in the profession for longer, but it only affects 4% of the working population so it's a measure for those on the highest incomes

• The 5p cut to fuel duty on petrol and diesel is being extended which is welcome, especially for those living in rural areas who rely on a car

• The Work Capability Assessment (WCA) has been abolished and up to 50,000 places on a new voluntary employment scheme for disabled people, called Universal Support, is being introduced. While we welcome the scrapping of the WCA, if it means that only people in receipt of PIP qualify for LCWRA (Limited Capability of Work Related Activity) within the Universal Credit system, which gives around £340 extra per month to recipients, it will put more pressure on the PIP system, which is already under pressure, and it may cause some people to miss out on money they should be eligible to claim. As such the jury is still out on this measure.

Case Studies

We spoke to Keely (not her real name) who is a single parent of an 11 year old boy. Keely was recently forced to stop work because she is affected by a serious health problem and is struggling to afford the essentials. Keely's mortgage has gone up due to rising interest rates and she is not eligible for housing benefit. Her electricity, gas, water, internet and food bills have also gone up sharply, and she is struggling to cope on a low income. She needed help with a food parcel and with a fuel voucher and a hardship payment. 

We spoke to John (not his real name) - he's a single parent in work who is really struggling as his rent, bills, food costs and childcare costs have all gone up but his wages have remained the same. He also needed a referral to the household support fund for help with essential goods. We see many families like John's, who simply can't afford the basics.