‘Some people are going to be pushed into absolute poverty’ - Lancashire residents reveal fears over rise in cost of living

Energy bills are set to soar by 54 per cent for 22 million households from the beginning of April, adding £693 to the annual bills of a typical household.

Meanwhile, inflation is set to hit an eye-watering 7.25% in April, according to new Bank of England forecasts released on Thursday.

And Lancashire County Council announced this week it is proposing a council tax increase of 3.99 per cent.

Many residents are already feeling the pinch and say Government needs to provide more support to struggling households.

The Lancashire Post has spoken to several people who revealed their fears about the impact of rising costs on their future and their ability to make ends meet.

Pensioner Doreen Kitchen says she is worried about affording the rising energy bills.

“I think it’s gone ridiculous. The prices have gone up [for] gas and electricity,” she said.

“You still have to pay it, whether you like it or not.”

For 79-year-old Barbara Chew, the biggest fear is having to choose between food or fuel.

Commenting on the rising fuel costs, Barbara said: “It would mean that you’re buying less food. It’s the choice between one or the other. It’s a bit scary, actually.”

The former accountant, who is now retired, said: “Luckily, I don’t have a mortgage but I don’t get any benefits whatsoever.”

Meanwhile, Doreen says she has lost faith in the Government’s ability to help vulnerable people, saying: “Boris Johnson, as well. I don’t know whether he’s telling the truth or whether he’s not but the other one, Labour leader [Keir Starmer], he’s just as bad, I think. They’re all the same.”

Barbara also believes the Government cannot protect people on the breadline, adding: “I think that they’ve that much on, they don’t know if they’re going forward or backward. I don’t think there’s an awful lot they can do really.

“The problem is, the people who need it are not getting it, and the people who are getting everything: they seem to be getting more.

“I don’t know what the solution is. It’s a scary world.”

She also fears for younger generations racking up numerous bills.

It is a feeling that many under 25s share, like Jade Morgan, who thinks the housing crisis is just as bleak.

The 24-year-old feels the prospect of being able to afford her first home is crushingly impossible.

A Preston City Councillor who represents St Matthew’s, she said: “Some people are going to be pushed into absolute poverty. I think my concern definitely is [that] I don’t own a house yet, mostly because mortgage [prices] at the moment are really bad.”

Coun. Morgan, who lives with her parents, added: “I work part-time at the moment so it’s a real struggle to think that if I did get a house or I tried to rent, the amount of bills would just be absolutely through the roof and I wouldn’t be able to afford it.

“So I think for young people like myself who are establishing a career or just don’t have that good of a job, you know, zero-hour contacts and stuff like that, it’s just a real struggle. We’re never going to be able to afford our own home or rent, just because, when you get rent or a mortgage out of the way, who’s to say we’re not just going to get floored by energy bills?”

She believes the Government should regulate housing and energy prices, adding: “If they just let companies do whatever they want, they’re able to raise their prices as much as they want, so they are getting really rich, and no-one’s really holding them to account.”

Heather Aitchinson, 17, says students like herself also face an uncertain future and worry about finding work post-pandemic after leaving education.

The student, who studies maths, accounting and psychology at Cardinal Newman Sixth Form College, said: “It’s going to be hard to find a job and make a living. That’s what worries me.

“I don’t really want to go to university, so when I do go into real life, [I’m worried] I’m not going to find anything so it is scary. I don’t actually know what I want to do yet. I’m still very much confused.”

Earlier this week, the Chancellor Rishi Sunak revealed a £150 reduction in council tax for millions in England, which will not have to be paid back, and £144 million to councils to support vulnerable households.

He hopes it can offset some of the £693 per year that energy regulator Ofgem has added to the bills of millions from April 1.

The regulator was forced to hike the energy price cap to a record £1,971 for a typical household on a standard tariff as gas prices soared to unprecedented highs.

For customers with prepayment meters the price cap will go up by £708 to £2,017, the regulator added.

The price cap is set per unit of energy used with the increase calculated based on a household that uses a “typical” amount of energy. Households that use more will pay more.

Details of the Chancellor’s £200 rebate will be worked through following a consultation, but households will have to repay the cash with bill hikes of £40 per year over the next five years from 2023.

Ministers are hopeful that wholesale energy prices will drop so households can pay back what they owe without a major rise in bills.

Some energy company insiders worry that while good in principle, the policy is too reliant on falls in global gas prices, as investment bank Goldman Sachs previously warned prices are likely to remain at twice their usual levels until 2025.

Mr Sunak’s £150 council tax rebate will cover homes in bands A to D, impacting 80% of households in England, he said.

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A recommendation to increase Council Tax in Lancashire by 3.99 per cent is to be put to councillors at a meeting later this month.

Members of Lancashire County Council’s cabinet agreed this afternoon to make the recommendation after hearing the increase would include a two per cent rise for adult social care.

At this afternoon’s meeting, cabinet members were told that the medium term financial forecast for the county council had improved since last year, but the authority still faced a financial deficit year on year.

Latest figures show, subject to confirmation of final funding levels, a financial deficit of £21.690m is anticipated to be met from reserves in 2022/23, rather than the anticipated £30.470m.

By 2024/25 the deficit is expected to be £42.830m rather than the £50.048m previously forecast.

The council is also forecast to hold £204.450m of uncommitted transitional reserve at the end of this financial year, which includes a forecast underspend of £23.46m for 2021/22.

Members heard this would be sufficient to meet the forecast gap for all of the years covered by the Medium-Term Financial Strategy, 2022/23 to 2024/25, but there is a clear intention to identify savings during 2022/23 to reduce the funding gap in future years.

County Councillor Alan Vincent, deputy leader of the council, said: “Deciding on any rise in Council Tax is always a very difficult decision.

“The cabinet has carefully considered the council’s on-going financial situation, taking into account that like all councils we continue to face significant pressures and need to ensure we achieve a financially sustainable position.

“At the same time our priority is to continue to provide the best services possible for the people of Lancashire, particularly our older residents.

“After discussion it was decided to recommend to full council that this year’s rise should be 3.99%, which importantly includes a 2% rise for adult social care, which will help ensure services for some of our most vulnerable residents are protected.

“The final decision will be taken at our full council meeting on February 17.”