- The cost-of-living squeeze has led to almost 6 million UK households struggling to afford their essential communication services.
- The group has urged government to cut 20% VAT rate on household telecoms bills to 5% in line with other essential services.
A consumer group has warned that the cost-of-living squeeze has caused fresh headaches for the six million UK households as they struggle to meet their essential communication services such as landline, mobile, and broadband bills.
According to a new analysis by consumer group Which? the cost-of-living crisis coupled with the recent telecom costs, is further denting UK households. A recent survey from Ofcom highlighted approximately 5.7 million households are forced to cut down on essentials and witnessed one affordability issue in April.
The group has urged the government to cut the 20% VAT rate on household telecoms bills to 5%, as it would save the average household £120 per year. It revealed that 3.5 million homes reduced spending on items critical to afford their communication services in April. This is up from 2.2 million in February - indicating a 59% increase. In fact, between February and April this year, the number of households making over one financial adjustment to afford their services rose by 56%.
In April, around 22% of low-income families with an income of up to £25,999 has cut their spending elsewhere to afford connectivity services, indicating how essential these services are to modern life. This figure stood at 13% for middle-income families with an annual income of £51,999, almost double from 7% in February.
Kalkine Media deep dives into three FTSE-listed telecom stocks that you may keep an eye on.
Vodafone Group Plc (LON: VOD)
As one of the leading telecommunication companies, Vodafone Group Plc has a market cap of £33,215.73 million as of 4 August. With the Earning Per Share of 0.07, VOD has given its investors returns of 0.95% and 5.86% on one year and YTD basis. At 08:05 AM (GMT+1), its share was trading at GBX 118.74, down by 0.10%.
Airtel Africa Plc (LON: AAF)
Leading African telecommunication and mobile money services across Africa, Airtel Africa Plc’s market cap stood at £5,795.07 million as of 4 August. The FTSE 100 constituent has offered its investors one year and YTD returns of 73.61% and 15.76%, respectively. At 08:05 AM (GMT+1), its share was trading at GBX 155.10 and was up by 0.58%.
BT Group Plc (LON: BT.A)
BT Group Plc, at 08:15 AM (GMT+1), was trading at GBX 155.90 and down by 3.53% as of 4 August. With a market cap of £16,034.69 million, BT.A’s EPS’s stood at 0.13. The company has delivered its shareholders negative one year and YTD return of -10.92% and -8.14%, respectively.
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