The Joseph Rowntree Foundation (JRF) published analysis on 5 August 2022 estimating that the cost of living for UK households would rise by £2,550 between 2021/22 and 2022/231. The foundation is an independent organisation that researches poverty and social policy in the UK1.
The estimate breaks down into three components. Energy costs account for £1,150 of the increase over the period April 2022 to March 2023 compared with the previous year, as expected in May, plus a further £400 that JRF expected at the time of publication. Non-energy costs account for £1,0001.
| Component | Increase |
|---|---|
| Energy (April 2022 to March 2023 against previous year, as expected in May) | £1,150 |
| Additional increase expected | £400 |
| Non-energy costs | £1,000 |
| Total | £2,550 |
Against that, JRF calculated that the additional cost of living support package for non-disabled working-age families on means-tested benefits amounts to £1,200, delivered through a £400 energy rebate, a £150 Council Tax rebate and a £650 lump sum benefit payment1. The foundation also noted that benefits had been uprated by the inflation rate in the previous September, which was 3.1%, well below the 9.0% inflation recorded in April 2022, and that the National Living Wage had risen1.
"Our analysis gives the following results"
JRF said its energy calculations started from recorded gas and electricity expenditure by households in the first and middle equivalised income quintiles of the Living Costs and Food Survey for 2019/20. It assumed households in the bottom quintile pay for energy by prepayment meter while the middle-income household pays by direct debit, and applied the standing charge and unit price from the relevant energy price cap to derive consumption levels1. For the price cap periods of October to December 2022 and January to March 2023, JRF assumed the direct debit dual fuel tariff for standard consumption as projected by Cornwall Insight1. The wider cost of living estimate applied Bank of England inflation forecasts excluding energy to Office for National Statistics spending data1.
JRF also stated that it had not deducted normal price increases over a year. If those were assumed to be 2%, in line with the Bank of England target, the £2,550 increase would reduce to around £2,2501.
Why it matters for households
The estimate puts energy at roughly £1,550 of a £2,550 rise in household costs, making it the largest single component. For a household on means-tested benefits, the £1,200 of support JRF identified covers less than half of the total increase, and the gap is wider still against the energy portion alone. The price cap sets the standing charge and unit rate that determine most household bills, and JRF's method shows how the difference between paying by prepayment meter and direct debit feeds directly into what a household pays. Because the support payments were fixed lump sums while costs continued to rise, the real value of that help depended on when bills peaked. The £400 energy rebate formed the largest part of the package JRF assessed.
What happens next
JRF's figures for the October 2022 to December 2022 and January 2023 to March 2023 price cap periods rested on Cornwall Insight projections rather than confirmed cap levels, which had not been announced at the time of publication1. The briefing does not set out further steps beyond the analysis itself1.