Disposable income hit hard by rising mortgages and energy bills UK households are 15% worse off than five years ago as rising food and oil prices put the squeeze on household incomes, a report out today said. Ernst & Young's annual discretionary income study showed that after tax contributions and monthly household bills, the average family has just under 20% of its gross income left over, compared with 28% in 2003. The average household now has £772.79 to spend each month after total fixed monthly outgoings, compared with £909.84 in 2003/04. Jason Gordon, director of retail at Ernst & Young, said: "Many UK consumer segments are clearly feeling the pinch as big rises in household costs are far outstripping relatively modest wage inflation." "The worst could be yet to come. If, as predicted, utility prices rise by as much as 40% later this year and interest rates are increased to control rising inflation, consumers and consumer facing businesses will face even bleaker times," he added.
UK households are 15% worse off than five years ago as rising food and oil prices put the squeeze on household incomes, a report out today said.
Ernst & Young's annual discretionary income study showed that after tax contributions and monthly household bills, the average family has just under 20% of its gross income left over, compared with 28% in 2003.
The average household now has £772.79 to spend each month after total fixed monthly outgoings, compared with £909.84 in 2003/04.
Jason Gordon, director of retail at Ernst & Young, said: "Many UK consumer segments are clearly feeling the pinch as big rises in household costs are far outstripping relatively modest wage inflation."
"The worst could be yet to come. If, as predicted, utility prices rise by as much as 40% later this year and interest rates are increased to control rising inflation, consumers and consumer facing businesses will face even bleaker times," he added.
And that's just average numbers, which, as we know, make things look better than they really are... In the long run, we're all dead. John Maynard Keynes
Times Graham Secker, UK equity strategist at Morgan Stanley, said the market was likely to fall a further 7% or 8% but there was a risk the gloom was overdone. "There is a lot of hysteria and negative views on the UK economy, from all sorts of parties," he said. "It's not necessarily wrong, but one should always be a bit more rational about these things. "There's a 50-50 chance the UK will have a technical recession. That doesn't mean we will have a really bad recession as we did in the early 1990s."
Graham Secker, UK equity strategist at Morgan Stanley, said the market was likely to fall a further 7% or 8% but there was a risk the gloom was overdone.
"There is a lot of hysteria and negative views on the UK economy, from all sorts of parties," he said. "It's not necessarily wrong, but one should always be a bit more rational about these things.
"There's a 50-50 chance the UK will have a technical recession. That doesn't mean we will have a really bad recession as we did in the early 1990s."
LOL In the long run, we're all dead. John Maynard Keynes
Stansted given permission to increase passengers numbers to 40m BAA's controversial plans for a second runway at Stansted will be sent to a public inquiry by ministers this week - but the company will at the same time be given permission for a big increase in passenger numbers at the Essex airport. Numbers could rise from the present 23.5m to as many as 40m following ministers' decision to scrap current restrictions and allow an increase in flights. The move to a public inquiry on the £2.3 billion second runway means a final decision on whether it can go ahead is now not likely before 2011 at the earliest. Ruth Kelly, the transport secretary, is expected to announce the two Stansted decisions this week.
BAA's controversial plans for a second runway at Stansted will be sent to a public inquiry by ministers this week - but the company will at the same time be given permission for a big increase in passenger numbers at the Essex airport.
Numbers could rise from the present 23.5m to as many as 40m following ministers' decision to scrap current restrictions and allow an increase in flights.
The move to a public inquiry on the £2.3 billion second runway means a final decision on whether it can go ahead is now not likely before 2011 at the earliest. Ruth Kelly, the transport secretary, is expected to announce the two Stansted decisions this week.
Brown hints at fuel duty freeze Gordon Brown has said the delayed 2p rise in fuel duty was something that will be looked at "very, very carefully" over the next few weeks. He refused to say it would not go ahead but told MPs: "I think you will find that in most years since 2000 that the duty has actually been frozen." There has been speculation that the government is to shelve the rise in this autumn's Pre-Budget Report. Chancellor Alistair Darling also said he was "very focused" on fuel duty. On Wednesday, lorry drivers held a second demonstration in London demanding cheaper diesel.
Gordon Brown has said the delayed 2p rise in fuel duty was something that will be looked at "very, very carefully" over the next few weeks. He refused to say it would not go ahead but told MPs: "I think you will find that in most years since 2000 that the duty has actually been frozen."
There has been speculation that the government is to shelve the rise in this autumn's Pre-Budget Report.
Chancellor Alistair Darling also said he was "very focused" on fuel duty. On Wednesday, lorry drivers held a second demonstration in London demanding cheaper diesel.
policies going in the right direction... In the long run, we're all dead. John Maynard Keynes
South Korea has announced the first in a series of measures intended to tackle the cost of rising fuel prices. Thousands of public sector vehicles will only be allowed on the road on alternate days and government buildings air conditioning will be restricted. Prime Minister Han Seung-soo said that if oil prices continued to rise, more extreme measures would be taken. Correspondents say the move is largely symbolic as it covers only a limited number of vehicles and buildings. South Korea has to import all its crude oil supplies and expects to spend $111.2bn (£56bn) on oil this year, up from $60.3bn (£30.4bn) last year.
South Korea has announced the first in a series of measures intended to tackle the cost of rising fuel prices.
Thousands of public sector vehicles will only be allowed on the road on alternate days and government buildings air conditioning will be restricted.
Prime Minister Han Seung-soo said that if oil prices continued to rise, more extreme measures would be taken.
Correspondents say the move is largely symbolic as it covers only a limited number of vehicles and buildings.
South Korea has to import all its crude oil supplies and expects to spend $111.2bn (£56bn) on oil this year, up from $60.3bn (£30.4bn) last year.
