Fuel Costs: OAP Bills 'Doubled Since 2005'

Older people have seen their energy bills more than double since 2005, research from Saga has found.

The average annual spend on fuel bills for the over-65s soared to £1,355.90 last year, amounting to more than twice as much as the average of £668.98 in 2005, the group's analysis found.

Across the UK, some 12.9 million pensioners spent an estimated £17.4bn on electricity and fuel bills in 2012, Saga said.

Saga said that its recent research among the over-50s showed that almost three in five (58%) are worried about heating costs this winter and more than a third (35%) are already struggling with heating bills.

Its figures do not take into account the effects of a recent string of price hikes announced by energy companies, pushing costs up further this winter.

Research by MoneySupermarket.com found earlier this month that energy customers on standard tariffs could be facing average quarterly bills of £530 in the coming months. Consumers typically use around 40% of their annual energy consumption during winter.

Saga has argued that older people are disproportionately affected by increases to living costs, as they are often trying to live off a fixed income or savings.

Ros Altmann, director-general of Saga, said that its research had found that 29% of older people are raiding their savings every month to make ends meet.

She said: "We are still to feel the full effects of the latest price rises so energy costs are likely to put even more of a financial strain on households in 2013.

"While incomes have increased in the last seven years, they have not kept pace with the rate that energy and fuel costs have risen, meaning that people are spending more of their income on fuel.

"This is especially true for older people who are often on lump or fixed incomes or whose savings income has fallen."

The findings come after Prudential said this week that people planning to retire this year expect to be living off the lowest average incomes recorded in six years.

This year's retirees expect to have a typical annual income of £15,300, making them around £3,400 a year worse off than workers who retired in 2008, Prudential said.

Financial information website Moneyfacts also reported this week that annuity rates, which set the size of someone's retirement income, plunged over 2012 for men at their steepest rate in 14 years.

However, retirees were given some welcome news on Thursday, when the UK's top statistician announced that a key measure of inflation which is often linked to retirement incomes should remain unchanged.

Many annuities are linked to RPI (Retail Prices Index) and even a small change could have knocked thousands of pounds off someone's income over the course of their retirement, pensions experts had warned.

Saga used analysis of official figures for its research.