Energy bills  

Millions face a looming winter energy crisis and a warning that gas and electricity bills could surge by an extra £500 a year. 

A shock 60per cent surge in

Energy bills  

Millions face a looming winter energy crisis and a warning that gas and electricity bills could surge by an extra £500 a year. 

A shock 60per cent surge in wholesale gas prices at the beginning of this week - on top of earlier increases of 600% since January.

National Grid has also warned of tight electricity supplies as the amount of energy from renewable sources such as wind, dropped.

The current UK energy price cap, set by industry regulator Ofgem, is £1,277 – but analysts Cornwall Insight predict it will rise to £1,660 when it is reviewed on April 1. Today the cheapest fixed gas and electricity deal available in the UK is £1,700 - a month ago it was £1,177.   Experts believe households will pay £500 to £800 more for energy in 2022.

The cost of energy is also hitting industry, who say they will have to pass it on to customers with it likely to hit products like cars, building materials, chemicals and even toilet rolls. 

Fuel prices

Petrol prices have soared to an eight-year high last month as filling stations cashed in on the fuel crisis.

Average pump prices hit 136.8p a litre for unleaded – 22p more expensive than in September 2020. It meant the cost of filling the typical 55-litre tank in a family car was £12 dearer than a year ago, said the RAC.

Separately, an AA study found some forecourts are currently charging up to 163.5p a litre for unleaded – 27p above the average. This would add a further £15 to the cost of filling up.  

House prices

Growth in British house prices gathered speed in September when they rose by 1.7% from August, mortgage lender Halifax said on Thursday.

In annual terms, house price growth also accelerated to 7.4% from 7.2% in August. The average price of a detached home has surged by £41,000 over the past year as buyers have searched for more space, the research found. 

Taxes 

Council tax may need to rise by up to 5 per cent a year for the next three years to keep services running and pay for social care reforms.

That would add £299 on to the average council tax bill for a Band D household.

The Institute for Fiscal Studies said that under current government spending plans, a rise of at least 3.6 per cent on council tax bills will be needed per year just for town halls to keep services running at the levels seen before the coronavirus pandemic.

Such a rise would come on top of the 1.25 per cent increase in National Insurance announced last month. 

Supermarket food shop

The average household spent £277 a month on food expenses, but the latest inflation reading suggests this could increase to £285 a month this year. 

Analysis by MailOnline of prices today compared to those in March 2020 found many staple goods have gone up in cost include mushrooms, spring onions, cabbage, salmon, soup, kiwi fruit, apples and mineral water. 

Among the biggest price rises are eggs, sausages, fizzy drinks, fruit and bottled water; 

Price of a pint

The average price of a pint in the pub across the country could soon pass £4, the ONS has said. In London the price is already through that barrier.   

And the other factors driving price rises....  

Inflation

Prices are rising at the fastest pace in at least a quarter of a century as businesses pass on the costs of labour, materials, shipping and energy to consumers.

Firms in the services sector, which range from transport companies and hairdressers to pubs and restaurants, hiked their prices in September at the fastest rate since data began in 1996, according to the Purchasing Manufacturers' Index (PMI) from IHS Markit.

Manufacturers are also putting up prices as inflation once again stalks the global economy.

Inflation hit 3.2pc in August and is widely expected to surge past 4pc by the end of the year in a headache for Chancellor Rishi Sunak.

HGV crisis 

Britain is struggling to deliver good and move items die to a shortage of drivers. Large numbers have retired and some have returned to the EU because of covid and Brexit. 

The Government has set out an action plan over the weekend to address lorry driver shortages, currently running at 100,000 in the UK and 400,000 on mainland Europe.

It will see 5,000 temporary visas made available to foreign HGV drivers, while a £10million skills plan will help train 4,000 more truckers.

This week sources claimed only 27 drivers had applied for a new visa - but Boris Johnsons insisted it was 127. At the same time, tens of thousands of Britons were unable to take HGV driving lessons and tests during the lockdowns, which means the UK has missed out on a generation of skilled recruits.

Cost of materials

Wholesale gas prices have soared to record highs across Europe while the price of oil has almost doubled in the past year to close to $83 a barrel – the most expensive since 2018.

Copper has jumped by more than a third over the past year which, when combined with the shortage of semiconductors, will bump up the prices of electrical products. And cotton has also spiked above $1 a pound for the first time in more than a decade, rising more than 42pc over the past year, which could mean more expensive clothes.

Even arabica coffee has jumped almost 73pc over the past year to levels not seen since 2014, meaning Britons could soon be feeling the pinch when visiting their local cafe.

Disrupted global supply chain 

The cost of bringing in container loads of supplies, including festive products, from China has soared this year.  There has also been a major issue with containers being stuck in Europe rather than in Asia as shipping was disrupted by covid. It means that UK companies are struggling to get products made and shipped easily with long waiting times.   

Food shortages 

Farms are pouring milk down the drain at the same time as McDonald's and supermarkets cannot get supplies due to the lorry driver shortage.

There are not enough tanker drivers to collect milk from farms, while the dairies have too few delivery drivers to transport supplies to high streets.

At the same time, farmers are complaining that a chronic lack of workers to pick and pack crops means fresh produce is being left to rot in the fields.

Supermarkets are having to concentrate on moving fresh products rather than many dry goods because of a lack of trucks.  

Pig farmers have started culling livestock amid warnings from food firms the drastic measures will hit key ingredients.

Meat industry leaders say a lack of skilled butchers means abattoirs are refusing to accept pigs for slaughter, leading to fewer pork products and reduced choice.

This is expected to hit supplies of gammons and pigs in blankets in the run-up to Christmas.

The National Pig Association (NPA) and National Farmers' Union (NFU) are warning that tens of thousands of pigs - possibly 120,000 - may have to be culled on farms and incinerated.

Labour shortages 

Businesses have complained about difficulties recruiting staff from HGV drivers to baristas and warehouse workers.

But latest figures show unemployment stood at 1.55million at the end of July.

That was before the end of the furlough scheme this month which analysts believed could have put as many as 250,000 on the dole queue.

Critics say bosses have come to rely on uncontrolled migration from Europe providing a stream of cheap labour and should instead raise wages to fill staff shortages.