Soaring utilities biting into Brits' savings

For all the reports of Britons being unable to jet off for some summer sun for the first time in ten years or be unable to take a step up the property ladder, a lot less has been reported about the less sensational, but even more serious, effects the current economic turmoil is having on UK households.

For while a week's camping in Wales or a spring clean rather than a new conservatory won't do anybody any harm, rising utilities bills are hitting consumers hard, worrying new research has found.

Of those households questioned in a recent poll by the Chelsea Building Society, 15 per cent said they had dipped into their savings in order to pay their gas or electricity bills, more than the proportion who have taken similar action to meet their council tax commitments.

What's more, the rise in the cost of utilities is seriously impacting on people's abilities to set money aside for the future, with average savings for men down by 24 per cent and for women down by eight per cent.

Commenting on the findings, Darren Stevens, Chelsea director of customer services, said: "It is a completely new phenomenon for savings to be used for everyday expenditure on this scale.

"We are concerned that many people’s finances are in real trouble due to the growing pressure of rising costs across so many essential items."

Indeed, it's hardly surprising that people are struggling to look to the future given the immediate pressures being placed upon their wallets by the country's energy suppliers and the only forward planning many are doing is with dread regarding how high their bills will be once winter comes round again.

According to some observers, gas and electricity prices could go up by between 25 and 40 per cent this winter as suppliers pass on soaring wholesale costs to consumers and this is on the back of them putting their gas tariffs up by an average of 17 per cent and their electricity rates by an average of 16 per cent earlier this year.

As Peter Luff MP, chairman of the cross-party Business and Enterprise Committee warned: "We cannot avoid continuing rises in energy prices.

"If oil is hitting record levels, and there’s also increasing competition for gas and coal supplies, then prices are going to go up."

The only thing for consumers to do therefore is to equip themselves as well as they possibly can for the anticipated rises.

Not only does this mean keeping a tight rein on finances now and not get lulled into a false sense of security by bills which are inevitably low as the sun shines, but also that households need to shop around for the best deal before it's too late.