Transport beats housing as households’ largest cost
Average weekly household spending has risen to levels last seen before the global financial crisis at an average of £554.20 per week in the 2017 financial year.
Transport remains the largest expense faced by households, with the average family spending £79.70 a week, an increase of £5.40 over the previous year. Housing came in at £72.60.
Household spending differed by as much as £200 between the UK regions.
Unsurprisingly, retirees continue to spend more, proportionately, on recreation and culture. For the 65-to-74 age bracket, this represents around a fifth of their income. Recreation and culture was the second highest spending category for the first time, with households spending an average of £73.50 a week.
This follows a more widespread trend of people spending more on experiences than possessions. This was supported by rising spending on international air fares and accommodation.
The Resolution Foundation responded to the figures, saying that lower income families saw the fastest consumption growth. As a whole, the ONS figures show that households increased their spending by 4% in 2016/17, helped by low inflation and rising employment. Household incomes grew by 2.3% over the same period. However, lower income households (in the bottom half of the income distribution) increased their spending by 7%, far more than the 1% increase across the richest half of households.
Stephen Clarke, policy analyst at the Resolution Foundation, said: “Today’s figures confirm that families largely shrugged off any immediate post-EU referendum jitters and went spending. This extra spending outpaced the extra level of income available to households, which turned instead to their savings and credit cards.
“More recently, rising prices and squeezed incomes have put the brakes on Britain’s big spending households.”