The real reason why UK household bills are increasing: companies are taking advantage of the British public

Harry Carter

From April 1, UK families were hit with a whole host of price hikes on their household bills.

Water, electricity, gas, internet and mobile bills: it’s all up, up, up.

If you listened to the mainstream news and politicians over the last few years, you would be forgiven for thinking that it is all because of the cost of living crisis, driven by big bad inflation, forcing the price of things in the economy to keep increasing.

But just by delving into the balance sheets of some of the UK’s biggest companies, you may be surprised to see that profits are soaring, while working people struggle to keep the heating on and food on the table.

Crisisnomics

In 2022, geopolitical events like the invasion by Russia of Ukraine led to spikes in energy prices, as Europe and international markets scrambled to try and plug the energy gap left by their dependence on Russian fossil fuels. There is no doubt that this impacted households across the country.

But speak to any of the world’s biggest CEOs and they will tell you that there is nothing quite like a crisis, for the real money to be made.

The gains made by certain companies during the global pandemic would serve as a warning for what was to come. The macroeconomic shock created by the Ukrainian war would mark the start of a second wave of profiteering by some of the world’s biggest companies, who saw an opportunity to squeeze their customers for all they could.

It only takes a glance at the S&P 500 from 2020 to 2024 to see that the world’s biggest corporations had some exceptionally good years, despite the hardship felt by many working families globally during this period.

Sold down the river

Water bills have gone up on average by 26% for UK households this April. That means an average increase of £123 for families. In some cases, bills are set to increase by as much as 47%.

Unless you have been living under a rock, it may come as no surprise that wages are not increasing anywhere near as much as prices. So, why are our water bills so damn expensive?

Wales’ and England’s water services used to be administered by the government, but this all changed as water began to be privatised in 1989. When our water was sold off into private hands, there was no debt at all. Jump forward to 2025 and there is now £60bn worth of debt accumulated across the privatised water industry.

To add insult to injury, water companies have somehow been allowed to pay out over £80bn to shareholders over the last 35 years. All of this, while taking on extortionate amounts of debt, increasing consumer bills and letting our water infrastructure fall apart. While Dwr Cymru Welsh Water has a “not-for-shareholder” model, its behaviour has been very similar to that of its private counterparts.

The result has seen our most important natural resource, clean water, vital to sustaining life on these isles, sold down the river in a heap of sewage. Perhaps, it should come as no surprise to company CEOs and executives, that after 35 years of mismanagement, over 80% of the British public are now in favour of taking these polluting water companies back into public ownership.

Profits before people

Water isn’t the only industry where profiteering has seen prices go up. Just 20 energy giants have made half a trillion pounds in profit since 2020. The list includes some of the most notorious fossil fuel companies like BP, Shell and Equinor, known for committing environmental and human rights abuses around the world in the pursuit of profits.

The energy price cap, which sets the maximum cost per unit of energy that companies can charge on gas and electricity, is already 18% higher than in the summer of 2024. Meanwhile, there are millions of British households living in fuel poverty.

Maria Carvalho from Medact, which represents frontline health workers, commented: “Every pound pocketed by these corporations is a pound that could have kept someone warm, well and out of hospital.”

The work of anti-poverty campaigners across the UK has shown that cold homes kill.

Government backed inflation

The UK Government has for years allowed price rises on broadband and mobile at rates higher than inflation. This policy has almost guaranteed profit growth for service providers, provided they don’t mess things up.

This year, customers are facing price hikes of between 6-7% on their mobile and broadband. These increases will also impact customers who are mid-contract, as there are not the same protections for broadband and mobile customers as there are for energy customers, who can opt for fixed-term contracts.

By design, above inflation price increases provide one more way for big companies to be able to take working people’s hard earned money and put it into their own pockets and those of shareholders.

Price gouging galore

Food inflation has been one of the biggest costs faced by families each week at UK supermarket check-outs, with food prices going up because of the Ukraine war, which created shortages of grain and fertiliser in international markets.

Grocery prices have also increased because of poor harvests in Europe and North Africa, caused by extreme weather and crop diseases, all the hallmarks of a world experiencing climate breakdown.

Despite these challenges, it may come as no surprise that the big three supermarkets have enjoyed a 97% increase in profits since the pandemic.

To make this money, supermarkets have been squeezing the farmer and the consumer at both ends of the food chain. Farmers are frequently undercut and not paid enough by supermarkets, leading to smaller family farms being lost to corporate buy outs and more people being forced to shoplift as they can’t afford the skyrocketing food prices.

But it doesn’t stop there. On the customer side, the squeeze is getting pretty tight. ‘Shrinkflation’, has seen the shrinking of goods become common place, with supermarkets and food suppliers going one step further and also cutting the amount of expensive ingredients that they put into food products, in an effort to squeeze that sweet profit out and leading to some of the biggest payouts to supermarket shareholders in years.

Stopping the transfer of wealth

On LBC, the excellent money saving expert Martin Lewis was caught slightly off-guard and unsure when asked by host Andrew Marr why, according to a new survey; “retailers are more optimistic about their profits and growth prospects than they have been for 10 years”.

It might be because, for some, profits are soaring. While the last few years have seen more working families slip below the breadline.

Companies that face little to no competition now realise that they can charge more and more for the essential goods and services that people have to buy. This is essentially the equivalent to finding the magic money tree.

The only way to stop this massive transfer of wealth from the poorest in society to the mega rich is to tax those companies that until now have been able to fleece the British public on water, electricity, gas, food, internet, mobile and more.

Without government intervention, stronger competition regulation and the public ownership of natural monopolies, the reality for working families is that the profiteering scandal driving up household bills is not going to go away.

These days, there is always another crisis lurking around the corner for corporations to take advantage of.