Cost of Living: Scots need help to weather the storm

As firms wilt under a ‘perfect storm’ of cost pressures and households reel from increased energy, food and fuel, the government must now show firm leadership.

Chief Executive of Scottish Chambers of Commerce, Dr Liz Cameron CBE

At the beginning of September, the UK will have a new Prime Minister. Whether it’s Truss or Sunak, Scottish businesses and the public expect bold leadership as we continue to grapple with the cost crisis.

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The most recent business survey by Scottish Chambers of Commerce makes it clear that the cost of doing business has reached a tipping point. Companies are dealing with a multitude of pressures, forcing firms with little choice but to make difficult decisions which will impact on Scotland’s prospects for investment and growth.

Shoppers pass the closed British Home Stores (BHS) department store on Sauchiehall Street in Glasgow. Picture: Emily Macinnes/Bloomberg via Getty ImagesShoppers pass the closed British Home Stores (BHS) department store on Sauchiehall Street in Glasgow. Picture: Emily Macinnes/Bloomberg via Getty Images
Shoppers pass the closed British Home Stores (BHS) department store on Sauchiehall Street in Glasgow. Picture: Emily Macinnes/Bloomberg via Getty Images

This perfect storm of cost pressures is nothing short of a hurricane which is leading to a costs crisis of unprecedented proportions. The direct result of this has led businesses to make the toughest of choices including 8 in 10 Scottish firms increasing prices in response to these challenges, which will have a knock-on effect on consumer confidence and spending power.

Business cashflow is also coming under strain as government loan repayments, increases to business insurances and managing workforce pay are all piling on the pressure on business outgoings and squeezing the bottom line. This trajectory of business performance places economic recovery and growth into question, as long-term decisions on investment, expansion and new projects are placed on hold, or completely shelved.

Running alongside this is the cost of living crisis, with households also under severe pressure from increased energy, food and fuel bills.

Already struggling businesses and households are going to be hit further later this month. Ofgem has recently confirmed that the energy price cap will be updated quarterly, rather than every six months, leading to yet another increase in energy bills for families and firms at the end of August which will take effect from October.

Some analysts have predicted the price cap is on track to rise to £3,615 a year from January, piling further burdens on businesses and households as the cost of energy intensifies.

Increasing the cap every three months instead of every six months means that prices will rise more quickly for businesses and consumers to reflect higher wholesale prices – as well as falling more quickly when they dip.

This is a double-edged sword as there is still much uncertainty around energy security as the war in Ukraine rages on, and decisions by Russia related to energy supply to Europe will have a chain effect on the prices that European countries will charge UK energy providers.

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Pro-enterprise actions are required now from the UK Government to support businesses and households through this crisis and to arrest the decline in business performance and investor confidence. Introducing an energy price cap for small and medium-sized businesses has been a long-standing call from Chambers of Commerce in Scotland and the rest of the UK, and one the next Prime Minister should take seriously.

Although the UK Government has announced limited support for households with their energy bills, it risks not scratching the surface when additional increases in the price cap are taken into account. The challenge is magnified for businesses who have not seen any major support since the end of COVID-19 related funding and have instead been forced into further debt to manage inflationary pressures.

The immediate need for action is now on the shoulders of the UK Government. But as the Conservative Party Leadership contest plays out, the reality means there is a notable delay in policy action by the UK government.

Businesses are doing all we can to weather this storm to support employees and customers and to maintain vital investments in communities across Scotland. The call from the business community is clear: the economy cannot be put on hold and urgent action is needed now.


Peter Tompkins and Robina Qureshi (Positive Action in Housing)

Positive Action in Housing is a homelessness and human rights charity based in Glasgow. Each year we assist 2,500 families and individuals with housing and financial difficulties, including ethnic minorities, asylum seekers, refugees, and EU migrants. 95 per cent of our beneficiaries live in poverty and struggle financially daily. Like housing, energy is a fundamental human right, not a luxury.

With annual energy bills predicted to surpass £4,200 come January, we expect households to fall into spiralling debt. Faced with increases in other bills such as food and fuel, it will be the poor who will be least likely to cut costs to meet these energy bills.

For those in secure jobs and those who previously got by, the coming months will create new challenges and cutbacks will have to be made. But for the poorest in society, there are no costs to cut. Individuals and families who are already living a bare existence with no lifestyle costs, no meals out, no new clothes or expensive holidays.

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We fear for asylum seekers, some of whom have reported that the Home Office accommodation provider Mears left them without energy for days at a time. We fear for other vulnerable groups such as mothers with new babies, pensioners, and the disabled, who may switch off their heating to avoid getting into trouble with energy debt. Individuals who spend the most time at home and need to stay warm.

Going without heat during the winter, particularly for the elderly and young, can be deadly. National Energy Action reports that 3,000 people in the UK needlessly die each year from not heating their homes properly. Unless the government acts, the number this year will be far higher.

The campaign group Don’t Pay UK says more than 100,000 people have pledged to join its mass protest and stop paying their energy bills from October. However, gas and electricity demands are classed as priority bills, meaning there can be severe consequences for missing or being late on a payment. The supplier can chase arrears using a debt collection agency or seek a court order to enter your home and fit a prepayment card meter, which cuts off the electricity if it is not topped up and comes with a higher tariff. Anyone refusing to pay is “swinging a wrecking ball at their credit score”, with the resulting black mark making it harder to secure a mortgage or loan in the future.

What help is there if you fall behind on your bill?

If you’ve fallen behind with your household bills, it’s important not to wait to get help. Your supplier may be able to offer support and inform you about any available grants to pay off a utility bill or negotiate an affordable payment plan

If you have a prepayment meter, you can ask your supplier for “emergency credit”. You may also be eligible for an emergency fuel voucher (£49 in winter and £30 in summer) from the Fuel Bank Foundation.

The government’s energy bills support scheme can be accessed from the autumn. Households will receive a £400 discount on their bill, paid in six monthly instalments, from October. Additional means-tested support includes £650 for those on income-related benefits, £300 for pensioners who receive the winter fuel payment, and £150 for those who claim certain disability payments.

As consumer champion Martin Lewis has pointed out though, October's price rise quickly swallows up current levels of support. It’s time for the cap to come back down or for the government to absorb the difference. Leaving the poorest to fend for themselves will only lead to misery and lost lives.


Chief Executive Brian Sloan, Age Scotland

The cost of living is surging, and quickly, but solutions from decision makers are few and far between. It’s clear that action is needed, and fast as life has become unaffordable for growing numbers of older people. We believe governments and councils should fully explore all avenues of support they have at their disposal to ensure older households can cover the costs essential to supporting their health and wellbeing.

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We know this is a tough time for many so our helpline and friendship line is available to older people who are struggling, need expert advice or just a friendly chat (0800 12 44 222).

With energy bills sky-rocketing, Age Scotland also offers free online energy workshops to help older people get a better understanding of their household energy use, support them to stay warm and save money on their bills. The workshops cover a range of topics, including energy efficiency, accessing benefits and financial support which could help with energy costs and looking at future options for heating.

Age Scotland wants to see more money in older people’s pockets and that’s why we launched our Check In, Cash Out campaign. More than £400 million in social security goes unclaimed by older people in Scotland every year, and barriers to accessing this support must be broken down as a matter of urgency. We would like to see the Scottish Government launch a national campaign to raise greater awareness of the social security support available to older people, such as PensionCredit, Council Tax Reduction, Attendance Allowance, and support with energy bills, to ensure more people receive what they are entitled to which could help with this cost of living crisis. Last year, our helpline uncovered half a million pounds in unclaimed benefits for older people, but this is just the tip of the iceberg. Our free 0800 12 44 222 helpline offers older people a free benefit entitlement check and support on how to claim it. Another way is to use our online benefits calculator at

It is important that organisations and businesses come together and do everything possible to support people, especially those on low incomes, against the threats posed by the deepening cost of living crisis. For example, we would like to see supermarkets offer more cost-saving initiatives to help older shoppers cover essential food items, like Iceland’s move to offer over-60s a 10 per cent discount off their shopping every Tuesday. Supermarkets could offer free hot drinks to older customers in their cafes and low or no cost hot meals throughout the winter.

While we wish that they weren’t necessary in this day and age, there has been increasing talk of “warm banks” being set up throughout the country for people to visit if they can’t afford to heat their own home. These would be better promoted as “Social Spaces” in community centres, libraries, sports clubs and church halls, where older people can connect with others, take part in a wide range of enjoyable activities, and access healthy eating options. This would not only improve the health and wellbeing of those who use them but reduce levels of loneliness which are so prevalent in our winter months. Pride could keep people away, but if they are open, interesting and welcoming environments then they could be very good indeed. The Scottish Government and local authorities should look to invest and support these kinds of initiatives to help make them a success.

There is no doubt that the months ahead will be very hard, with more older people facing financial hardship and fuel poverty. Without a major national effort and interventions from governments, too many people will freeze and go hungry, their health deteriorating, and there will be the real prospect of loss of life.



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