The Budget

Thursday 10 July 2014

Majority will cut food shopping after Budget

Charlie Weston Personal Finance Editor

Published 28/11/2012|05:00

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NINE out of 10 people believe that the Budget will leave them so strapped for cash that they will end up spending less money on their grocery shopping.

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Families with children have had their confidence shattered even more and will be more inclined to cut back on day-to-day essentials like food to cope with new financial hits in the Budget.

Accountants say a family with one income of €55,000 and two children faces an extra €3,250 a year due to the property tax, universal social charge hikes and pay related social insurance ( PRSI) changes in the Budget.

Now a new survey shows that consumers are so frightened by the prospect of a sixth austerity Budget that they are preparing to scrimp on the weekly shopping bill.

Some 91pc of consumers believe next Wednesday's announcement from Finance Minister Michael Noonan will leave them with less money to spend on the items going into a shopping trolley, according to research commissioned by retail magazine 'Checkout' and carried out by Empathy Research.

When it comes to those with children, some 93pc expect to cut back on the grocery bill, the study of 1,010 people shows.

Large numbers of consumers think the price of alcohol will go up in the Budget. Over half think the price of cigarettes will rise. But less than one third believe the Government will introduce measures to encourage people to start spending again.

'Checkout' editor Stephen Wynne-Jones said: "Consumer confidence has been shattered by successive hairshirt Budgets, so it's unsurprising that such a high proportion of consumers are feeling pessimistic about December 5." Despite the pessimistic mood of consumers, most retailers are upbeat about Christmas trading – with most only expecting a marginal drop in sales this festive season.

Retailers are predicting on average only a marginal drop of 0.47pc in Christmas 2012 trading, according to a survey published by industry representative body Retail Excellence Ireland.

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