The cost-of-living crisis has pushed up bills for the average Scottish household by £167 per month since the start of this year, the second-highest rise of all the UK nations and regions after London.

The new research released today by KPMG comes before the impact of next month's hike in the energy price cap, which has been limited to £2,500 annually but is still almost double that of a year ago. The typical household's energy bill currently stands at £1,971.

In a survey of 250 Scottish consumers of varying household incomes in early September, KPMG found that essential household costs including food, energy, fuel, and mortgage or rent have increased by an average of £167.10 per month compared to when 2022 began. The highest increase of £203 was recorded in London.

Looking across the UK, average monthly spend among 3,000 surveyed consumers rose by £145. The highest average monthly cost increase was amongst consumers aged 35-44, who reported paying £194.40 more a month than in January.

“Scottish consumers told us that rising essential costs have left them £167 worse off a month compared to the start of the year," said Linda Ellett, head of consumer markets, retails and leisure at KPMG. "Of course, some households are already paying more than this average, and all households still have October’s energy price rise to manage.”

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Those that have been buying less this year have most commonly been cutting back on eating out (59%), clothing (54%), and takeaways (51%) – the three most common areas of spending reduction from polling in April and December 2021.

On average, consumers that had savings at the start of 2022 have 43% remaining. Half of those polled are not currently using their savings to help meet essential costs, but a third of consumers are having to.

An additional 10 per cent have now spent all their savings on offsetting rising essential costs.

To manage those rising costs, a third of UK consumers said they are buying more own brand or value products, with the same proportion switching to products on promotion or discount.

A quarter are shopping at less expensive retailers, and a quarter said they are buying fewer items. One in ten are spending more on credit.

Asked about their ability to make non-essential purchases, 24% said they have been buying more of the things they want in 2022, and 34% said this was about the same amount as in 2021. A further 26% said they have been buying less, and 16% weren’t sure.

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“It’s clear that consumers are responding where they can - altering how much they buy, what they buy and where they buy it," Ms Ellett said. "Retailers are also responding and will need to continue to be data-driven to anticipate and adapt to changes in demand.”

Overall, a greater amount of the 3,000 consumers surveyed said they were feeling more secure (37%) than less secure (22%) in their financial circumstances than they were at the beginning of the year. When KPMG carried out its last UK-wide survey in April, the result was reversed with 34% feeling less secure vs 26% feeling more secure.

Ms Ellett added: “The increase in the proportion of consumers feeling more financially secure than they did at the start of the year, despite the rising costs, is surprising. But it could be the case that the actions they have taken to manage outgoings has improved confidence in being able to prepare for this cost of living squeeze.

“Increased certainty regarding energy costs will provide some further confidence. But unsurprisingly, in the face of rising costs, regardless of cutting back and searching out lower prices, some consumers are struggling to meet even essential costs. They feel less financially secure than when the year began and face a tough winter ahead.”