In spite of successive crises, including the coronavirus pandemic and spiralling energy costs, the average Luxembourg household should see their purchasing power increase in 2023, compared to 2019, regardless of their home heating source.
According to STATEC, this increase is made possible by last autumn’s tripartite measures.
Dividing the country’s households into five equal groups, from the lowest income to the highest, STATEC made the following observations:
Although the wealthiest households will see a higher increase in their income according to the data above, they will actually be earning less than would have been the case without the tripartite measures, said STATEC.
This “negative effect” on wealthier households is due to the “mechanical delay of the index tranches”, explained STATEC. The tripartite measures, which targeted energy prices in particular, are therefore more likely to benefit lower-income households, for whom energy costs make up a higher percentage of their budget.
Tripartite measures to reduce gas and heating oil costs are taking their toll on household heating costs. Households using gas to heat their homes will see a distinct advantage here due to the cap on gas prices. Heating oil is subsidised in comparison.
It is not just citizens who have benefited from the tripartite either, said STATEC, with employers reporting an estimated two billion reduction in their wage costs, which in turn benefits the Grand Duchy’s economy. This data is expected to play a role in the upcoming tripartite discussions announced by the Prime Minister on Wednesday, ahead of a predicted third index tranche at the end of the year.
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