18 July 2007
Falling gas and electricity prices have helped lower inflation for many elderly consumers, but a new report suggests over 75s are still struggling with the cost of day-to-day living.
A report from Alliance Trust found that despite the fact that the rate of inflation affecting people over 75 has dropped from 3.4 % to 3.2%, it still remains noticeably higher than the headline inflation rate of 2.4%.
Although Alliance Trust links the decrease in inflation for elderly consumers with the recent fall in gas and electricity prices, the inflation rate for elderly customers remains 29% higher than headline rates.
"Headline inflation has fallen back to 2.4% this month, but the elderly are still facing a higher rate of inflation of 3.1%. Any household that spends a large proportion of its budget on basic goods and services is currently facing a higher rate of inflation than the headline inflation figure suggests," Shona Dobbie, Head of the Alliance Trust Research Centre said.
"Falling gas and electricity prices are helping, but gas price inflation is still running at 5% and electricity price inflation at 6%, which adds to the cost of running a home. Gas and electricity prices have not yet fallen far enough to bring elderly inflation in line with the official rate."
She added: "The impact of higher prices for basic goods and services, such as heating and food, almost always falls most heavily on the elderly and those on low incomes, as these households spend a larger proportion of their budgets on these necessities."
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