News about the world: Family spending 'dropped in 2009'

Tuesday, November 30, 2010

Family spending 'dropped in 2009'

Lower mortgage costs helped to offset higher bills for gas, electricity and rent

Family spending fell in 2009 for the first time in 10 years, the Office for National Statistics (ONS) has said.

The average household spent £455 a week, down from £471 a week in 2008.

The three largest categories of spending were transport, recreation and culture, and housing, fuel and power, although spending in each sector dropped during the year.

The long-term fall in spending on clothes and shoes, and household goods and services, also continued.

Both hit their lowest levels yet recorded under the current methodology of the ONS, at £20.90 per week and £27.90 per week respectively.

"This is the first annual decline in average UK household spend since the current method of recording was introduced in 2001-02, with higher expenditure on some housing related costs such as rent, electricity and gas offset by lower spending on mortgages," said Giles Horsfield, the editor of the ONS report.

"Lower spending on diesel and fuel contributed to lower expenditure on transport, but reductions were also seen on vehicle purchases and public transport."

The UK economy was still in recession for most of 2009 and only started growing again in the last three months of the year.

Unemployment also rose sharply in the first half of 2009 to reach its recent peak of nearly 2.4 million.

Although family spending on package holidays fell, particularly for those abroad, expenditure on attending sports events, the cinema, theatre and concerts was steady.

The five regions where family spending was above the national average were London, the South East of England, the East of England, Northern Ireland and the South West.

Rural family expenditure was higher, at £500 per week, than in urban areas, at £450.20 per week, due to higher spending on transport, recreation and culture.

However, families in urban areas spent slightly more than those in the country on housing costs, fuel and power.

The data on family spending comes from the ONS's survey of the spending habits of 5,223 households who took part in its living costs and food survey.

The survey has been running, in various forms, since the 1950s.

This article is from the BBC News website. � British Broadcasting Corporation, The BBC is not responsible for the content of external internet sites.