The cost-of-living crisis is far from over
With the warmer weather, new Cost of Living payments and inflation expected to fall this year, politicians could be tempted to take their eyes off the cost-of-living crisis.
But the latest Citizens Advice data shows this would be a mistake, as we’ve just recorded our bleakest-ever start to the year.
Between January and April 2023, we broke records in 70 different advice issues.
Among these were record numbers of people struggling with:
A key indicator of how bad the crisis has been is the rise of people needing a crisis support referral to help to afford food or other essentials. This is one of the many data points we use to see how the crisis is affecting people.
In 2022, we helped far more people with crisis support than in any previous year — but so far 2023 is even worse. Compared to this time last year, we are currently helping 21% more people with crisis support. And 2 and a half times (178%) more people than in 2020, the year the pandemic started.
It might look like these numbers dropped off a bit in April. This is mostly because April is a shorter month with fewer working days. We can see that the number of people we’ve helped with crisis support each day did not fall between March and April.
Digging into these numbers shows us that, while disabled people and people with long-term health conditions have been the hardest hit, a broad group of people have been unable to afford essentials. For example, this year, we’ve helped a record number of people with crisis support who are in work — nearly 3 times more than we helped in 2020.
Our debt advice data also shows some really concerning trends. In January to March this year, more than half (52%) of the people we’re helping with debt advice didn’t have enough monthly income to cover their essentials — we call this a ‘negative budget’. This is our highest number on record.
If more and more people can’t afford their essentials, then this will ultimately result in a household debt crisis.
We know that government policy can help reverse these trends, as when policy works it shows up in our data.
When the Cost of Living Payments landed in people’s bank accounts in July 2022, we saw a dip in the number of people coming to us for crisis support referrals. We saw another dip when people started getting the Energy Bill Support Scheme (EBSS) payments in October 2022. But this was not enough, as these numbers shot back up again to record levels.
The unwelcome records we’ve broken so far this year shows that the cost-of-living crisis is far from over. Government Ministers and policymakers simply can’t afford to move on.
The first of the 2023/4 Cost of Living Payments for people on low incomes will have started reaching bank accounts by the end of April. This is welcome and we’ve seen before that government support makes a difference. But struggling households will need more help. For many, life is getting worse, not better.
Find out more
For more Citizens Advice data insights, sign up to next cost-of-living briefings. Our next events are in May and June.
You can also see all our charts in the Citizens Advice cost-of-living data dashboard.
