Martin Lewis highlights salary range facing pain after autumn statement

Martin Lewis and partner Lara Lewington pictured in 2022. (Getty)
Martin Lewis and partner Lara Lewington pictured in 2022. (Getty)

The 'squeezed middle' is most likely to feel the pinch of Jeremy Hunt's autumn statement, Martin Lewis has warned.

The money saving expert warned that some 'middle earners' - which he outlined as people on salaries between £20k and £50k a year - are likely to suffer most following the £55bn worth of tax hikes and spending cuts announced by the government on Thursday.

The chancellor's measures included freezes to income tax thresholds, increases in council tax, and confirmation that energy bills will rise.

While benefits and pensions will increase in line with inflation, there will be less support when it comes to energy bills for those in the so-called 'squeezed middle', with the energy price guarantee rising to £3,000 from April.

Watch: Jeremy Hunt to defend autumn statement amid warning of record fall in living standards

Treasury analysis suggested that 55% of households will be worse off as a result of the changes, while Paul Johnson, director of the Institute for Fiscal Studies (IFS), said the hit to living standards would be "simply staggering".

Economists at the Resolution Foundation think tank said the plans pile further pressure on those in the "squeezed middle", who face a permanent 3.7% income hit, which is bigger than the very richest.

They said wages would be £15,000 higher if they had continued to grow at their pre-financial crisis rate rather than face "this unprecedented 19-year pay downturn".

Read more: Jeremy Hunt accused of 'slipping out' massive tax cut for banks

Lewis said he had met with the chancellor earlier in the week where he pushed hard for mortgage flexibility and forbearance for the squeezed middle ahead of spring.

Speaking on LBC, he commended extra support for the poorest households in the country, but said middle earners will have to deal with rises to mortgage or rent payments whilst also receiving less support with energy bills in the form of the £400 payment made this year by the government.

"Those who are in the squeezd middle who had that £400 help last year will both see an increase in their energy bills to £3,000 and won't get the £400 help. That gives you in totality a rise of around 41% on energy bills that have already doubled this year.

"That £3,000 for a typical house, ... if we take that as a total, that is just an enormous whack. If you're earning £27,000, £3,000 a year on energy alone - not your mortgage, not your rent, not anything else - is an enormous whack. And that's why it is people in the middle who are really going to feel the squeeze."

Watch: Money-saving expert Martin Lewis has warned that the 'squeezed middle' will feel the pinch the most

Speaking on Good Morning Britain, he highlighted it would be a difficult time for those earning £20,000-£50,000 a year.

"Obviously the real issue in this budget is the squeezed middle and I think there are certainly going to be problems there," he said.

He said issues would arise next spring when interest rates peak, affecting those with mortgages or private renters whose rents are likely to rise as their property owners face mortgage hikes, would combine with less energy support decreasing, adding to financial strain.

"I think there are certainly going to be difficulties for those in the £20, £30, £40, £50,000 range even," he added.