Families across Scotland could face another difficult winter as rising mortgage costs, soaring energy bills and worsening inflation forecasts place renewed pressure on household finances.
The SNP is demanding an emergency cost of living plan from Prime Minister Andy Burnham, warning that existing government support could be overwhelmed by further increases in everyday expenses.
The intervention follows the Bank of England’s decision on Thursday 5 November to increase interest rates by 0.25 percentage points to 4%.
The Bank also warned that inflation could reach around 5% by the middle of 2027, with a more severe scenario suggesting a possible increase to 6.2%.
Higher borrowing costs are particularly concerning for homeowners approaching the end of fixed mortgage agreements, with around three million UK households expected to move off existing deals between the second half of 2026 and the end of 2027.
The SNP claims some Scottish mortgage holders could face more than £5,000 in additional annual interest payments compared with 2021, although individual increases will depend on borrowing levels and mortgage terms.
Research from the Resolution Foundation suggests the Bank’s revised inflation outlook could leave average private sector earnings £670 lower in real terms next year than previously forecast.
Simon Pittaway, Principal Economist at the Resolution Foundation, said:
“This is a tale of two rises from the Bank, a widely expected increase in interest rates and a more surprising jump in its inflation forecast.
“The big increase in the outlook for inflation, now forecast to peak at almost 5 per cent next spring, is a major worry for households.
“High inflation will shrink real-terms pay packets, which are set to be £670 lower next year compared to previous forecasts and risk outstripping rises in benefits and the state pension too.
“The £100 Council Tax rebates announced in the Budget last week look pretty small by comparison.”
Energy bills present another substantial concern, with MoneySavingExpert forecasting that January’s domestic energy price cap could increase by 28.8%.
Consumer finance expert Martin Lewis warned on X:
“The latest predictions for the January Price Cap, AWFUL, up 28.8%!
“This is our internal MSE document where we average three forecasts and how it’s changed over the past few weeks as wholesale rates have continued to rocket.
“PS Jan prediction is getting much more locked in as we’re 85% through the 19 August to 17 November 2026 assessment period.”
If realised, the forecast would increase the annualised bill for a typical household from £1,723 to approximately £2,219, although actual payments depend on energy consumption.
The Bank of England has also warned of further pressure on food prices, adding to concerns about household spending power.
SNP Westminster Leader Dave Doogan MP said:
“With the UK rapidly heading to the cliff edge, it’s time for Andy Burnham to finally wake up and bring forward an emergency plan to help families with the cost of living crisis this winter.
“The UK budget was embarrassingly weak and the miniscule announcements made have been completely obliterated by the news that household bills will soar in the months ahead leaving many families thousands of pounds worse off under Burnham’s government.
“Energy bills could be £1200 higher than the Labour Party promised, families could face a £5000 annual hike in their mortgage bills, and the soaring cost of food and fuel could reduce real incomes by £670 more than expected.
“Brexit Britain is facing a tidal wave of rising costs that will wipe out any minute benefits from the UK Budget and leave families facing yet another year of plummeting living standards.
“What use is a delayed ten year plan, if the Prime Minister doesn’t even have a plan for the next 10 weeks?
“Britain is broken.
“The UK has had twenty years of declining living standards and twenty years of excuses under successive Labour and Tory governments.
“Andy Burnham promised to be different but instead of delivering breathing space he is leaving people to suffocate under the weight of soaring bills.
“This isn’t as good as it gets.
“Families in energy-rich Scotland should not be paying some of the highest bills in Europe but it is only with independence that we can use Scotland’s huge energy wealth to lower bills and build a brighter future for Scottish families.”
The Bank of England makes interest rate decisions independently of the Government, while several of the financial figures cited by the SNP remain forecasts or illustrative comparisons rather than confirmed costs for every household.
Nevertheless, the combination of rising prices, increased borrowing costs and uncertainty over winter energy bills presents a serious challenge for households already struggling to make ends meet.
For families across Scotland, the immediate concern is whether wages and available support can keep pace with the rising cost of everyday life.
