UK households £500 worse off in 2011
Bank of England survey shows that British households have around £46 less a month to spend
UK households are around £500 worse off this year than they were in 2010, according to new research.
The Bank of England has published the results of an annual survey which shows that British households have around £46 less a month to spend, the fifth successive year that disposable income has fallen.
The research, which was carried out for the bank by NMG Consulting, attributed the fall to an increase in VAT and energy prices, as well as public spending cuts.
It found that 56 per cent of households claimed their wages had failed to keep pace with rising bills, while 48 per cent said they had been affected by the government's spending cuts.
Furthermore, the number of people falling behind on bills or credit commitments surged from 4.1 per cent in 2010 to 7.5 per cent in 2011.
"Over the past year, the recovery in the UK economy appears to have slowed," said the report.
"That weakness in the UK demand has been driven by falling consumption, reflecting the challenging environment facing households."
Posted by Sarah Nyman
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