The Trades Union Congress says UK households have paid an average of £13,961 in additional costs since 2021, driven by higher mortgage payments, loans, energy bills and water charges.
The TUC analysis of Office for National Statistics figures breaks down the burden. Households with mortgages spent an extra £9,034 on average, equating to £1,806 per year. Those with loans paid an additional £1,911 total. Energy and gas bills consumed an extra £2,644 on average per household, or £529 per year. Water bills added £372 more, at £74 annually.
The union umbrella body attributes the cost surge to inflation following the exit from the Covid pandemic and wars in Ukraine and the Middle East. Paul Nowak, TUC general secretary, said working people had "borne the brunt of crisis after crisis" and that the government needed action before winter.
The warning comes with less than two weeks until Chancellor John Healey's first budget on 28 October. The TUC urges him to introduce a social energy tariff, raise capital gains tax, increase taxes on banks, and help poorer households and young people with rising living costs.
Healey pledged in his Labour conference speech to give households "breathing space" but warned the government had limited resources to soften the global economic shock. The Treasury is preparing a "tightly focused" budget to limit market backlash. The International Monetary Fund this week urged Healey to "stay the course" on cutting the budget deficit.
Consumer spending remains well behind pre-pandemic levels. The UK has recorded the weakest growth in consumer spending in the G7 since before the pandemic, the TUC report states. Nowak said the "eye-watering bill rises" were squeezing consumer spending and holding the economy back.
The centre-left IPPR thinktank separately urged Healey to raise £16bn, mostly through capital gains tax rises with a new entrepreneur exemption. It called for a £2,000 cap on consumer energy bills, a rent stabilisation mechanism, a fuel duty freeze, and increased housing allowance for universal credit claimants. The Confederation of British Industry pressed Healey for cuts to employer national insurance contributions and business electricity costs.