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“We’ve never seen demand like this”: Citizens Advice warns of further cost-of-living struggles

The organisation predicts that April will be a “pinch point” for many as energy price guarantee ends.

By Harry Clarke-Ezzidio and Katharine Swindells

The rising cost of living led to a record number of people needing specialist crisis support last year, with more than 150,000 people seeking help with food bank referrals and emergency charitable support for the first time, data from Citizens Advice reveals.

The number of people in employment who received crisis support has increased by 155 per cent between 2019 and 2022, the organisation reports, culminating in an average of three people every minute requiring advice services in December.

Despite government interventions to help people with the rising cost of living – including the energy price guarantee – the extent to which millions have continued to struggle has led to calls for more action. Demand for Citizens Advice’s services last year was “unprecedented”, said Morgan Wild, the organisation’s head of policy.

“We haven't seen anything like this before, certainly not in recent years,” Wild told Spotlight. “And for many issues, since our records began, we haven’t seen the number of people needing us for particular issues be so high.”

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Of all the things individuals and families may struggle with, Wild singles out the rapid rise in the number of people coming to Citizens Advice for support because they are unable to top up their prepayment energy meters. More people have needed help with this issue, which Wild described as “emblematic of the scale of the crisis”, than in the last ten years combined.

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Demand for Citizens Advice's help far exceeded what it had predicted, Wild revealed: “At various points over the course of the year, we need a bigger y-axis [on our graphs tracking demand] because the trends have accelerated so dramatically since we first made our projections.”

Demand for food bank referrals, advice with energy bills or help with energy debts, and delays to payments for people suffering from long-term illness have hit “levels we just haven’t seen in the past”, Wild added.

The government has announced that energy support schemes will begin to be wound down this year. The energy price guarantee, which has limited the price of energy per unit since October 2022, is set to end in April having initially being designed to last for two years. To partially compensate, the government will give households receiving benefits £900 (paid in three instalments, across the year). Pensioners (£300, paid next winter) and people on certain disability benefits (£150, paid in the summer) will also receive one-off payments.

The uprating of benefits and pensions to last September’s inflation rate of 10.1 per cent, coupled with additional one-off payments to deal with high energy bills, the main driver of the current crisis, “should at least be [enough] to help with that section of the population”, Wild tentatively predicted. But the people who are likely to suffer most, he continued, are those suffering from severe financial difficulties but just fall outside of the eligibility for state support.

“For people who fall outside of the benefits system bills are on average £2,100, annually. That will very likely jump to £3,000 in April, even with the decline in wholesale gas prices,” Wild said. “There’ll be a real pinch point around April this year, when you have that combined effect of energy bills going up and government support falling away for those people who are below average incomes, but not receiving any form of means tested benefits.”

[See also: Gordon Brown: Why it’s time to take the shame out of the cost-of-living crisis]