Whilst we are all hopeful that the worst of the pandemic is behind us, the last two years have changed us all in some way. We have had to adapt, be flexible and some, completely change our lives to what we knew pre March 2020. Reflection and re-focus have been on many of our agenda’s. Through the most traumatic and life altering event of our generation, we have experienced personal, societal and worldwide loss.
Alongside personal change, there have been and continue to be, changes in our country, society and community. Many of us in Gateshead and beyond, are worried about national agendas that will have a detrimental impact on our lives.
In January 2022, it was reported that 55% of people in Britain feel that health is the most important issue facing the country at this time. This was followed by the economy being the next largest area of concern, at 46% of people (Source: statista.com).
Getting the NHS back on track and dealing with the increasing backlog of non-Covid related illnesses is a worry on everyone’s mind and has been since the pandemic started. Climate issues and impact of Brexit have also been a topic of great thought and concern. The last few months, following the reduction in the £20 Universal Credit uplift and fuel poverty, set to rise further, has had a massive blow on many people in the borough.
Unfortunately, the current rise in costs to our fuel and the continued increase to come over the next few months and beyond, is inevitable. Due to the surge in wholesale prices of energy, the consumer, us, have to pay the excess. Ofgem (Office of Gas and Electricity Markets), calculate a price cap – a form of economic monitoring that sets a limit on prices utility companies can charge. Ofgem set the price cap, as backstop protection from the government, with the goal of Ofgem being protecting consumers and improving energy systems.
In April 2022, this price cap will increase dramatically and will no doubt have a huge impact on all households. In particular, there is concern for low-income households, whomay already be struggling financially.
It is expected that the price cap for energy will increase from the current £1,277 per year to around £1,925 in April (around 50% rise). These figures are based on an “Average,” household. This rate in April will be locked in until October, where it could rise again. So basically, it means the average household will pay around an extra £700 in fuel costs per year.
There are discussions on ideas being advanced to government to support the increase in energy costs such as temporary suspension of VAT, expanding winter fuel allowance payments to all on Universal Credit and looking at taking away the green tax levy, of over £100 per year, which could be too controversial. However, it seems that even financial experts are stumped for answers right now.
Along with inflation set to rise by up to 6%, lending rates will mean the consumer pays more back. Added to this, is the increase in National Insurance levy for those earning more than £12,875 per year, to 1.25p per pound. Furthermore,supply chain barriers mean food and clothing prices are also likely to rise creating a very real worry of how people will manage.
So in these worrying times, what can you do to try and budget effectively? It is often very easier said than done, especially for those on low incomes. However, some of the ideas below may be useful to assist you with planning your finances:
• Write income and expenditure down: budget planners can help to see what you spend money on and where you may be able to target outgoings. A free, comprehensive one, with tips can be found here on Martin Lewis’s informative website.
• Small changes in your household’s energy use will add up. Turn plugs and lights off when not needed. Don’t repeatedly re-boil the kettle. Wash clothes on a quick, cooler wash. Seal out draughts, even by using a rolled-uptowel by your front and back doors. If you can sew, become creative and make a draught excluder from material such as a leg of an old pair of trousers, stuffed with other old material. Use hot water bottles and have a cosy throw next to the sofa to keep you warmer.
Put on an extra layer instead of just reaching for the thermostat to your central heating. Turning your heating down a degree or two can make a difference over the month. Check insulation in your house, in particular in your loft and around your loft hatch.
• If your house has severe condensation, damp issues or issues to the structure of your windows and doors that could mean draughts are a problem, please report this to your landlord. Shelter provides free advice and guidance to tenants for private and social housing.
• Whilst food shopping, if you can, go nearer the end of the day to get the end of day bargains. Much of this will be able to be frozen and fresh will still have a day or so (be cautious of meat and fish items which are best to freeze if bought on their use by date). If you have veg and fruit past it’s best, blanch them and freeze them. Frozen chunks of fruit are delicious added to porridge or smoothies. With veg that isn’t at it’s peak, make some soup, a casserole, chilli, even a curry. All of these can be frozen and enjoyed at another date. Here are some links to recipes on a budget
• Know where the foodbanks in the area are. Foodbanks provide a wonderful service to local people. The volunteers and staff are kind, sensitive and want to help.
• Food Cycle in Felling offers free meals each Friday at 12:30pm. Not only will you receive a nutritious meal, but you’ll be guaranteed to receive great company, conversation and no judgement – everyone is welcome, no questions asked and no referral needed.
• If you are struggling financially, please also consider a visit to the Citizen’s Advice Bureau who can advisearound debt management and benefits you are entitled to.
It’s also worth noting that alongside the increases in our outgoings, the minimum wage is also set to rise from £8.91 to £9.50 in April 2022. Alongside this, employment opportunities are in abundance in the area and many organisations are offering company joining bonus’s.
If worries about finances and living costs is affecting your wellbeing severely, please seek help from your GP, services noted in this article or The Samaritans on 116 123 or via their website here.
Helen is a journalist for Radio Gateshead, a local lass who has spent the last two decades working in health and social care. She has recently set up a community interest company called Write on the Tyne which amalgamates her passion for supporting and empowering marginalised groups to thrive with her love of writing.
Her debut novel, The Dinner Club, was released in March 2022 with UK based Cahill Davis Publishing, and her second book The Life and Love (Attempts) of Kitty Cook will be released in March 2023.