Householders are worse off

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HOUSEHOLDS could see a drop of up to £780 in disposable income in 2011, a survey by Deloitte has suggested.

The survey says the drop is due to changes in tax introduced by Chancellor George Osborne.

Deloitte economic adviser Roger Bootle believes UK incomes will not return to their 2009 peak until 2015.

The quarterly economic survey predicted that average salaries would grow by only 2.5 per cent this year, while inflation is likely to run at about five per cent, meaning that, in real terms, pay will continue to fall.

Real earnings will fall by 1.5 per cent this year, Deloitte predicted, the fourth consecutive year of falls – the first time that has happened since the 1870s.

The warning comes as employers’ group the CBI said Britain’s small and medium-sized manufacturers saw their orders from customers grow at the fastest rate in 16 years.

The FTSE opened 0.45 per cent up on early trading as the City watched for any effects of Osama bin Laden’s death.