Finances: Is George Osborne right? Is the plan to build back Britain really working?
The findings from the Markit Household Finance Index – which measures households overall view of their well-being – showed that
it picked up to 39.7 during December from a seven-month low of 38.8 in November.
But respondents highlighted the pressure being put on their budgets by weak pay trends and big increases in power bills as factors which caused financial headaches.
According to the Markit Index, a reading of over 50 implies that households believe that their situation is getting better, anything below it suggests a deterioration.
Therefore, the low numbers reported suggested a significant number of people still feel as though they are struggling to make ends meet.
In addition, almost 30 per cent said their financial situation had worsened over the month.
These findings come despite assurances from Chancellor George Osbourne that his plan to build back Britain ‘was working.’
During the autumn statement on 5 December, Osbourne bragged that Britain’s economy was growing faster than any other major economy.
Almost 30 per cent of people surveyed said that their financial situation had worsened over the month
However, he insisted: ‘The plan is working – it is a long term plan for a grown up country. The job is not yet done but Britain is moving again – let’s keep going.’
At the time, Labour said that Osbourne was in ‘denial’ about the ‘cost-of living-crisis.’
This survey appears to back this up.
But despite the obvious strain on households up-and-down the country, there was some positive news.
The Markit index measuring the outlook for finances for the next 12 months – was at 47.8 –the highest reading since January 2010.
According to Markit's senior economist Tim Moore: 'December's survey suggests that a rising proportion of UK households are hopeful that the squeeze on their finances will begin to subside during 2014.
‘The improving outlook indicates that strengthening domestic economic conditions have started to boost consumer sentiment.
‘However, while job insecurities have receded this year, the latest survey highlights that income and saving trends remain very subdued, especially at the lower end of the pay spectrum.’
A week before Christmas, millions of British households are finding themselves struggling to have enough money to enjoy the festive season in an economy that continues to be tough.
However, the survey suggests that many people believe that the outlook on their finances will improve in 2014.
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