Friday June 12th 2020
More than one-fifth of usual household spending has not been possible during the lockdown, Office for National Statistics (ONS) analysis reveals.
In the financial year ending March 2019, UK households spent an average of £182 per week on activities that have since been largely prevented by government guidelines (such as travel, holidays and meals out).
This is equivalent to 22% of a usual weekly budget of £831, money that households could be saving, spending in other areas or using to cover any loss of income.
To estimate the potential impact of the coronavirus (COVID-19) on spending, and the extent to which people might be able to cut back, ONS have categorised household spending from before the pandemic based on lockdown measures introduced on 23 March 2020.
Across all households, more than half (53%) of usual spending covers “non-discretionary” items such as food and housing costs. The ONS refer to this as spending on “essentials”.
Younger households, those who are renting spend a lot proportionally on essentials and relatively little on goods and services that have been unavailable under lockdown. This could limit their ability to cut back on spending if their income were to fall.
To help households under increased financial pressure, some companies – including mortgage providers and gas, electricity and water suppliers – have offered payment holidays on regular bills.
ONS estimate that 39% of household spending on essentials could be subject to a payment holiday, equivalent to £173 per week.
Source: Office for National Statistics – Living Costs and Food SurveyTweet Share on Facebook