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UK households grappling with energy bills set to triple – think tank

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LONDON — The proportion of UK households struggling with energy bills will triple in April when regulated prices are set to rise by more than 50%, the Resolution Foundation said on Monday.

The UK government will need to spend more than 7 billion pounds ($9.6 billion) this year if it is to offset the effect of soaring energy prices for households, the think tank said.

Prime Minister Boris Johnson’s government is under increasing pressure from the rising cost of living. The Bank of England expects annual consumer price inflation to hit a 30-year high of around 6% in April.

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“Rising gas prices are sending energy bills skyrocketing and will see the number of families suffering from ‘fuel stress’ triple to more than six million homes this summer,” said Jonny Marshall. , an economist at the Resolution Foundation.

The proportion of households spending more than 10% of their income on electricity and heating bills – a threshold used to define “fuel poverty” in Scotland, Wales and Northern Ireland – will triple to 27% at from April, the think tank estimated.

Many small utility companies have collapsed as wholesale energy prices have risen faster than the maximum rates they are allowed to charge, which are updated twice a year.

The average household energy bill is expected to hit £2,000 a year in April, the Resolution Foundation said.

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Offsetting the impact of this for the poorest households would cost £2.5billion, through a £300 increase in an annual grant and extending it to the poorest 8.5million households. poor. This measure would reduce the number of households in “energy stress” by one million, according to the think tank.

Another measure – deferring the cost of utility company failures to household bills and using general taxation rather than energy bills to fund climate change mitigation – would cost an additional £4.8bn and reduce a supplement the number of households in a situation of “energy stress”. 1.7 million. ($1 = 0.7306 pounds) (Reporting by David Milliken, editing by Paul Sandle)