The Big Issue defines the cost of living crisis as “a situation in which the cost of everyday essentials like groceries and bills are rising faster than average household incomes”. The think tank Institute for Government defines the UK’s cost of living crisis as “the fall in real disposable income (that is, adjusted for inflation and after taxes and benefits) that the UK has experienced since late 2021”.
But, whichever definition you choose it spells out a very difficult autumn and winter for many families and individuals.
New Bevan Foundation research reveals the majority of people in Wales are already cutting back on essential items. The recently published “A snapshot of poverty in Summer 2022” highlighted the following findings.
- Families are struggling to make ends meet – More than one in eight Welsh households (13 per cent) either sometimes or often struggle to afford everyday items. In total 45 per cent of Welsh households never have enough money for anything other than the basics.
- The majority of people are now cutting back on essential items – 57 per cent cut back on heating, electricity and/or water, 51 per cent cut back on clothing for adults, 45 per cent cut back on transport costs and 39 per cent cut back on food for adults between January and July.
- Children are going hungry – the number of people in households with one or two children who are having to cut back on food for children has nearly double since our last Snapshot report in November 2021, with one in ten families with one child and one in five families with two children cutting back on food for children.
- Household debt has remained static – the number of people that are reporting that they are in arrears on a bill or that they have borrowed money has not increased significantly since November 2021. In total 14 per cent of people have been in arrears on a bill for more than one month with 25 per cent borrowing money.
- A third of people have no savings – 22 per cent of people in Wales had no savings at the start of 2022, whilst 10 per cent spent all their savings on day-to-day items between January and July 2022. Only 31 per cent of people had savings in January 2022 and did not use them to cover day-to-day items.
- More people are worried about losing their home – 11 per cent of people are worried about the prospect of losing their home over the next three months. This rises to a quarter of private rental sector tenants and 17 per cent of social housing tenants.
- The cost-of-living crisis is affecting people’s health – 43 per cent of people in Wales have seen their mental health deteriorate as a result of their financial position whilst 30 per cent have seen a deterioration in their physical health.
- People are very pessimistic about their prospects over the next three months – nearly two thirds (63 per cent) of people expect to have cut back on at least one essential over the next three months, up more than 20 percentage points from the position in November 2021.
- More work to do to raise awareness of support – many people are not aware of all the support they are entitled to from the UK, Welsh and local governments. This means that there are families struggling financially that are missing out on vital assistance that could make a difference.
One of the most important messages for people is that they are not alone and there are people and organisations there to help. A good start is the Senedd guide available at: https://tinyurl.com/mtn398yc
The Welsh Government’s Discretionary Assistance Fund is also available. A fund of last resort intended to support people experiencing extreme hardship. The fund is offering greater flexibility for people impacted by the cost of living crisis. Welsh Government EAPs are awarded to help with essential costs when in extreme financial hardship. The payment is intended to help cover the cost of food, gas and electricity, clothing and emergency travel. Support is also provided for individuals who need support with costs for off-grid fuel.
To claim a Welsh Government cost of living payment, you can apply online to the Discretionary Assistance Fund for an Emergency Assistance Payment (EAP) here https://gov.wales/get-help-cost-living
Or by calling free on 0800 859 5924 (Croesawir galwadau yn Gymraeg / Calls are welcomed in Welsh).
In addition to the help available nationally in Wales, we have help locally in the form of Newport Citizens Advice open Monday-Wednesday 9am-1pm in Corn Street to help with debt advice and benefit eligibility. Age Cymru are offering free home energy checks and can help with other eligibility advice and Remake Newport in Skinner Street have a free community repair shop and low cost items to borrow.
Full Bevan Foundation report – https://www.bevanfoundation.org/resources/a-snapshot-of-poverty-in-summer-2022/