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Families paid out less for gas and electricity in 2014 despite rising prices

Published 08/12/2015

Households in London and the South East spent the most per week in 2014, according to the latest Family Spending report
Households in London and the South East spent the most per week in 2014, according to the latest Family Spending report

Households paid out less for gas and electricity last year despite rising prices, while otherwise mainly increasing their spending in a sign of consumer confidence, according to latest figures.

Families spent 10p a week less on electricity and 30p less on gas in 2014, even though the price of both increased, mainly because of warmer weather and better home insulation, according to the Family Spending report from the Office for National Statistics.

One of the biggest falls in spending over the last 15 years has been on cigarettes, with the average household now spending £3.40 a week - down from £3.50 in 2013 and £4 in 2012 - and only 800 of the 5,130 households in the survey buying any at all.

Despite this drop, however, families still spent an average of £12.30 on alcohol, tobacco and narcotics combined but just £9.80 on education and £7.10 on health.

Overall, families spent an average of £531.30 a week last year, with the lion's share of the budget going on transport, driven by car buying and cheaper fuel.

The overall figure is an increase of £7.40 on 2013 but is £24 higher than the total in 2012 when spending averaged £507.40 a week - evidence of consumer confidence as the economic recovery continues, the ONS said.

But the report shows that spending on food and non-alcoholic drinks has been level since 2011, partly because of the increase of discount supermarket chains, increasing consumer choice and competition in the market.

Spending on clothes and shoes fluctuated only slightly between 2011 and 2014, while spending on restaurants and hotels has followed a broadly downward trend between the year ending March 2002 and 2014.

One of the report's authors, Joanna Bulman said: "The trends in different types of spending between 2013 and 2014 provide evidence that consumer confidence is increasing as the economic recovery continues.

"An increase in spending was observed in all but two categories of spending (housing, fuel and power and alcohol, tobacco and narcotics) although not all increases were statistically significant."

The report reveals that average weekly spending on transport increased by 6% in 2014 to £74.80, accounting for 14% of household budgets.

The highest percentage of transport costs went on travel fares, at £16.10, followed by petrol (£14.90) and buying second-hand cars or vans (£14.60).

Housing, excluding mortgage payments, fuel and power was the second most expensive category at £72.70 a week, followed by spending on recreation and culture, which increased to £68.80 per week.

Families spent an average of £58.80 on food and non-alcoholic drinks each week, buying £5.40 worth of bread, rice and cereals and spending £4.80 on drinks other than alcohol, £3.50 on fresh fruit, £4.20 on vegetables, £3.70 on buns, cakes, and biscuits and £1.90 on chocolate.

Households in London and the South East spent the most, while those in the North East and Wales spent the least, and spending in rural areas was on average higher than in urban centres.

The lowest-earning 10% of households spent an average of £188.50 per week, whereas the highest-earning 10% typically spent £1,143.40.

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