Energy bill hikes will cost two months’ wages
Average take-home pay after tax will stand at £2,054 per month in 2023, based on Bank of England forecasts.
But with the average energy bill set to soar to £4,200 next year, it means two months of wages will go toward paying gas and electricity costs.
The Trades Union Congress is now urging the government to devise an urgent response to the crisis by working together with trade unions and business leaders, as happened during the pandemic with the launch of the furlough scheme.
It also proposes to stop the October energy price cap increase, echoing the call by Ed Davey, leader of the Liberal Democrats, who earlier this week called for an ‘energy furlough’ scheme, as well as a windfall tax on gas companies.
The TUC said that without intervention, energy bills will rise by £1,500 from October, and the government should step in to cover the estimated £38.5bn cost. It said energy companies should be taken into public ownership, a lesser £2.85bn cost than the extra charges facing millions of families.
It also wants to see the minimum wage, Universal Credit and the state pension rise in October as annual increases usually take place in April. It wants to see the April 2023 rise brought forward to October 2022, based on the usual recommendations from the Low Pay Commission and September’s inflation figure – expected to be 10%.
Further, it also wants to see pay rises in the public sector “that keep up with inflation”. It currently stands at 9.4% for June and the TUC said this will “Protect millions of households from surging prices”. It said this would also help prevent a recession by “maintaining consumer spending and supporting business confidence”.
‘Families pushed to the brink’
Outgoing TUC general secretary, Frances O’Grady, said: “No one should struggle to get by in one of the richest countries in the world.
“But up and down the country, millions of families are being pushed to the brink by eyewatering energy bills. With prices set to skyrocket even further, it’s time to say enough is enough.
“Boris Johnson, Liz Truss and Rishi Sunak need to wake up to the size of this crisis. This requires a pandemic-scale intervention.
“Ministers must cancel the catastrophic rise to energy bills this autumn. And to make sure energy remains affordable to everyone, they should bring the energy retail companies into public ownership.
“Ministers should also act to boost pay – as well as Universal Credit, pensions and the minimum wage by bringing forward planned increases to October.
“And they should fund it through a bigger windfall tax on the obscene profits of energy giants.”