UK families face 'financial timebomb' without emergency measures, says ex-PM Brown
Tim Hanlon
Families in the UK are facing a cost-of-living crisis. /Henry Nicholls/Reuters

Families in the UK are facing a cost-of-living crisis. /Henry Nicholls/Reuters

Former British prime minister Gordon Brown has warned of a "financial timebomb" that could "push millions over the edge" as he called for an emergency budget for families struggling with the UK cost-of-living crisis.

Conservative leadership candidates Rishi Sunak and Liz Truss should meet with Prime Minister Boris Johnson to plan emergency measures or risk "condemning millions of vulnerable and blameless children and pensioners to a winter of dire poverty," said Brown, writing in the Observer newspaper.

Many people in the UK have been hit hard by rising inflation that has pushed prices up – a situation that is only going to get worse during winter when more will have to be spent on heating.


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Energy prices have risen considerably and some have spoken of the need to choose between food and heating.

"A financial timebomb will explode for families in October as a second round of fuel price rises in six months sends shockwaves through every household and pushes millions over the edge," said Brown.

"A few months ago, Jonathan Bradshaw and Antonia Keung at York University estimated that April's 54 percent increase in fuel prices would trap 27 million people in 10 million households in fuel poverty.

"Now, 35 million people in 13 million households – an unprecedented 49.6 percent of the population of the United Kingdom – are under threat of fuel poverty in October."


Morality questioned

Brown said that the Government has failed to tackle the crisis for households and that new measures must be agreed – even if it meant recalling parliament to force it to happen.

"The more the Conservative leadership election heats up, the more the remaining candidates have resorted to claiming the moral high ground," continued Brown. "Raising debt is 'immoral', Rishi Sunak is saying. 'High taxes are immoral,' retorts Liz Truss. But there is nothing moral about indifferent leaders condemning millions of vulnerable and blameless children and pensioners to a winter of dire poverty."

A new report by Donald Hirsch at Loughborough University shows that support for poorer households does not over the losses they face from inflation and the general cost of living crisis – which has seen some families up to $1,900 worse off a year. The extra $1,449 offered to the poorest will not be enough, he said. 

Britain's cap on domestic energy prices is expected to rise by 70 percent in October and remain high until at least 2024.

Based on wholesale energy prices, the cap on the most widely used household energy contracts is projected to rise by about 70 percent at the next change in October, taking average annual household dual-fuel bills – covering both gas and electricity – to more than $5,000, said analysts at Cornwall Insights.

A review of support for the next price cap periods should be top of the to-do list for any incoming prime minister, said Craig Lowrey, principal consultant at Cornwall Insight.

The cap is expected to rise again in January, to $4,365 a year, and remain above $3,621 a year until at least 2024, Cornwall Insight said.

The End Fuel Poverty Coalition campaign group warned that millions of people will face a two-phase cost-of-living crisis this winter if those projections prove accurate.


READ MORE See CGTN's "Crunch Time" special for reports on how the cost-of-living crisis is affecting people across Europe

Source(s): Reuters

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