April is set to see a lot of price rises - what is going up and what support is available?

Millions are set to be squeezed by the cost of living crisis Credit: PA

Words by ITV News Multimedia Producer Connor Parker

Many in the UK are already being squeezed by a cost of living crisis but with the start of the new financial year in April, everyone is set to be hit even further.

Although the current situation is not unique, the UK is dealing with a global economy waking up from a pandemic, increasing demands on services that were effectively turned off for a few years, difficulty navigating the new post-Brexit world and facing the impact of the Ukraine/ Russia war.

All of this has meant a drastic increase in the cost of living.

The Resolution Foundation (RF) has calculated that the cost of living crisis will push 1.3 million households into absolute poverty and real incomes will fall by between 4-6% - the largest fall since the end of rationing in the 1950s.

This is mostly being driven by inflation, which is forecast to hit 8.7% in the fourth quarter of 2022 and to average 7.4% over the year, with wages failing to keep pace with rising prices.

What is going up in price soon and what can be done about it?

National Insurance

From April 6, National Insurance (NI) will increase by 1.25% for all taxpayers in the UK.

This was announced in September as part of a health and social care levy aimed at increasing funding for the NHS and care industry.

The amount employers need to contribute to NI will also increase by 1.25% which could discourage wage increases.

Rishi Sunak announced a raft of measure to help with the cost of living crisis last week Credit: PA

However, from July nearly 30 million UK workers will have their taxes cut through the rise in the threshold at which NI is paid, while 2.2 million will be taken out of paying national insurance contributions (NIC) altogether.

This was announced as part of Chancellor Rishi Sunak's spring statement, which was aimed at providing some support to tackle the cost of living crisis.

NI starting thresholds will rise to £12,570 from July, aligning income tax and NI in a tax cut worth more than £6 billion.According to the Treasury. this will save the typical employee more than £330 in the year.

Someone earning £14,500 a year will be £336 a year better off, according to calculations from Hargreaves Lansdown.

But the “tipping point” comes at around the £40,000 mark – and someone earning £50,000 could end up paying around £100 more this year than last, the firm said.

Energy bills

Of all the price rises hitting at the start of next month, the energy bill increase is by far the largest.

Ofgem has said the energy price cap will rise by 54% from April 1, affecting around 22 million customers.People paying default tariffs by direct debit will see an increase of £693 from £1,277 to £1,971 per year, while prepayment customers will see an increase of £708 from £1,309 to £2,017.

There are fears the energy price cap could rise even further.

The government has announced various support packages to help people deal with the increase.

Houses in England will receive rebates on their council tax worth £150 for homes in bands A to D. They will not need to pay this back.

All domestic customers will also get an upfront discount on their energy bills worth £200 from October. Households will repay this in £40 instalments over five years.

An extra £500 million was also announced for the household support fund, doubling its total amount to £1 billion.

This fund is distributed via local authorities, with people being able to apply to their council outlining their needs and hopefully receiving a grant.

Listen to our latest What You Need To Know podcast

If you're still struggling with your bills, the first thing to do should be to tell your provider.

While they may use threatening language in letters to try and scare you into getting you to pay, they may be able to offer you some form of payment plan or other assistance if you ask for it.

They may ask if you have a planned out monthly budget, and if you need help with this or help getting the confidence necessary to talk to your provider then you can contact Citizens Advice.

They have offices all over the country and they can help with both long term and short term budgeting.

Energy bills are set to rise sharply for millions Credit: PA

They can also help you get access to a food bank if you need it.

Another charity called Turned 2 Us also offers support over the phone.

They can help you find any benefits or grants you may qualify for if you need a bit of support with your bills.

If you are on a low income or claim pension credit, you may eligible for Warm Home Discount through your supplier.

This cuts bills with a one-off discount of £140 at some point between September and March - which will be taken off your bill rather than be paid directly to you.

You must contact your supplier to confirm your eligibility and apply, though the number of discounts a supplier can give is limited.

If you fall behind on payments, there are suppliers that offer grants. Citizen's Advice Bureau (CAB) lists suppliers that offer grants:

If none of these companies supplies your energy, you can still apply for a grant though British Gas Energy Trust as you do not need to be a customer.

Applications can be time consuming. For help, CAB advises to reach out to one of its advisers or to contact Money Helper.

Meanwhile, Simple Energy Advice offers a tool on its website to locate grants available in your specific area.

Your local council may also provide various grants.

If you are unable to pay your heating bills you should contact your supplier. Credit: PA

Council Tax

As with most years, Council Tax is increasing this year but the sting is hitting particularly hard this year when combined with all the other increases.

The average Band D council tax set by local authorities in England for 2022/23 is £1,966, up £67 or 3.5% on the previous year.

This includes adult social care and parish precepts, but does not take into account the £150 council tax rebate.

Despite this, the average 3.5% rise for Band D properties in 2022/23 is below the 4.4% rise in 2021/22 and is also the lowest year-on-year increase since 2016/17.

Fuel prices

On top of bills and tax rises, the surge in inflation is also impacting most basic commodities.

One of the main drivers of this is petrol prices, which have risen sharply in the past 12 months and have risen by a fifth since October.

Prices are now hovering around 160p a litre but in the coming days, prices should fall slightly.

As part of the chancellor's spring statement, Mr Sunak announced fuel duty would be cut by 5p a litre.

This is already in effect and will last until this time next year but it is expected to take around a week to filter down into the forecourts.

Fuel prices are soared in recent weeks. Credit: PA

Food prices

Food is also being impacted by the inflation rise, with prices 5.2% higher than they were a year ago.

More and more people are turning to cheaper products and supermarkets as a result of the rise.

This isn't unique to the UK either, the UN has said the price of basic commodities is already 7% higher than it was a year ago.

Pub meals and hotel stays

The cost of buying a pub meal, soft drink or hotel stay could become more expensive from April as VAT levels across the hospitality sector lift back to 20%.

The industry saw VAT dropped to 5% to support its recovery during the pandemic.

It rebounded back to 12.5% in October last year as restrictions eased, but from Friday has returned to 20%.

Despite the initial fall in tax, few pub groups, restaurants and leisure businesses were able to pass on the benefits of the tax break – which covered soft drinks, food, events tickets, accommodation and other areas – to customers due the financial impact of the pandemic.

Bosses said that lengthy Covid disruption, significant debts and soaring cost inflation in recent months mean the reduced tax level has been used to help absorb costs.

However, industry chiefs, including Wetherspoon founder Tim Martin and Young’s boss Patrick Dardis, said prices would now have to increase significantly for customers as a result of reduced VAT support.

Emma McClarkin, chief executive of the British Beer and Pub Association (BBPA), said the VAT rate increase alone is expected to cost UK pubs more than £500 million over the next year.

UKHospitality boss Kate Nicholls said it “might prove fatal” for business owners.