Gas bills treble in 10 years

Household bills have risen at nearly double the rate of inflation in the past decade. Gas bills have trebled and electricity has doubled in price, according to Office of National Statistics data taken between February 2002 and February 2012. Any upside at all?

Well, claims the new Santander report, it is making us use juice-heavy appliances like the kettle less.

Water torture

And such economy measures will need to accelerate given there's a new utility rise coming: water rates. British consumers face average water bill increases of of 5.7% this month. If household bills continue to rise further over the next 12 months, one in 10 people now claims they won't be able to manage financially, says the Santander report.

"One in five people have reduced or stopped using appliances such as tumble dryers that use a lot of power, and one in 10 (10 per cent) have watched less TV in an effort to reduce their bills," claims Santander. "One in five have made their home more energy-efficient and nine per cent say they have installed a home energy monitor."

Brit salaries not keeping pace

Just compare how much salaries, in contrast, have risen at the same time. Average UK salaries have climbed from £16,964 in 2001 to £21,093 in 2011, according to figures from the ONS - an increase of just 24%. But retail price index inflation has risen 38% and household bills climbed overall by 71%.

Inevitably these rises hits those with least most because more of their income is spent on basics like energy. However bills have been inching up for at least a decade. (Remember that VAT was introduced on domestic fuel back in 1994.)

Yet VAT is a killer in terms of taxation for those on modest incomes - a view backed by the Office of National Statistics. George Osborne has always claimed VAT is a 'progressive tax'. But ONS research from last year shows that the poorest fifth in the UK spent almost 10% of their disposable income on goods attracting VAT in 2009/10, while the richest fifth spent just 5.3%.

For help on cutting your energy bills, the Energy Savings Trust website offers plenty of good advice.

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