The Chancellor George Osborne reckons his 'Better Deal' plan could save families as much as £470 a year.
The Government has published a document called A Better Deal, a blueprint for ways to boost competition and help people bring down their household bills which it reckons could save the average family as much as £470.
The document, which was presented to parliament by George Osborne, the Chancellor of the Exchequer, outlines exactly what steps the Government is taking to help all of us get a better deal on all sorts of bills, from banking and broadband to what we pay at the dentist.
Cutting regular household spending
According to analysis by the Treasury, this is what regular household spending looks like on average across the country.
|
Household bill |
Average costs per year |
|
Housing costs (including mortgage repayments) |
£4,880 |
|
Energy |
£1,280 |
|
Clothing |
£1,180 |
|
Insurance |
£875 |
|
Telecoms |
£725 |
|
Water |
£385 |
|
Health products and services |
£325 |
|
Legal and banking |
£35 |
|
Total |
£9,685 |
With the median household income standing at around £23,600 per year, that spending accounts for more than 40% of disposable income, a figure the Government has said it wants to see drop.
But how?
Water
Business and other non-household customers will be able to switch water suppliers from 2017. But the Government wants to bring this same level of competition to households too. The regulator Ofwat will report on the costs and benefits by next summer, then the Government will work with the suppliers to bring in the ability to switch before the end of this parliament.
Read What does the average water bill cost? to see how your bill compares to what you would pay in other regions.
Banking
A New Bank Start-Up Unit is to be established, to make it easier for new banks to enter the market.
The Government said it is taking steps to get people more engaged with their bank accounts, to encourage them to shop around more, following research from the Competition and Markets Authority which suggested the average person could save £70 a year by switching to the best available current account deal.
Compare bank accounts with loveMONEY
Broadband
[SPOTLIGHT]The Government believes that broadband prices “often lacks transparency”. The Advertising Standards Authority is currently looking at whether “teaser rates” on broadband deals are misleading people, with the expectation of swift action to ensure prices are made clearer, with no hidden costs.
Legal services
The Government wants to reduce barriers to allow “alternative business structures” (like supermarkets and estate agents) to offer various legal services, including conveyancing, probate and litigation. This will only apply in England and Wales though.
Pharmacies
The NHS community pharmacy market is to be reviewed, with the aim of introducing online, delivery to door and click and collect pharmacy and prescription services. The idea is that this will save time for working people.
Dentistry
Dentist treatment plans and price lists will be made clear and easily accessible. This will only apply in England.
Motor insurance
The right to cash compensation for minor whiplash injuries will be removed. This will apparently cut £1 billion from the cost of providing motor insurance, which is the equivalent of a saving of up to £50 for each policy.
Check out our great guide to the different ways that you can cut the cost of your car insurance!
Energy
The projected cost of green policies on the average household bill will be cut by £30 from 2017.
The Government also wants to make switching supplier easier and quicker, similar to the seven-day switch which was implemented on bank accounts.
Compare the cheapest energy tariffs you could switch to today
Mobile phones
The Government said it expects the mobile phone industry to automatically unlock mobile phone handsets when people reach the end of their contract.
Currently customers will spend up to £20 to do so, with an estimated £48 million spent each year. It will also consult next year on ending the practice of handset locking for people outside any initial contract period.
School uniforms
The Government has pledged to ensure that parents and carers get “the best value deals” on school uniforms in England. It pointed out that families are significantly less likely to report financial hardship when schools allow them to purchase uniforms from a variety of suppliers.
How much will I save?
The Government reckons that between the insurance and energy measures announced in last week’s Autumn Statement, and by switching your energy supplier, current account and mobile tariff every year – which it claims this plan will make easier – households could save as much as £470 a year.
What do you think of the Government’s ideas? Do they go far enough? Are there other areas that you’d like to see the Government take action on, in order to cut your bills? Let us know your thoughts in the comments box below.