UK: The Deloitte Consumer Tracker: Q1 2013

Last Updated: 24 April 2013
Article by Deloitte Consumer Business Group

Key findings:

  • Sentiment on disposable income is stronger than at any time since Q3 2011.
  • UK household conditions remain stable in the first quarter of 2013.
  • The consensus is for the recovery to gain traction as 2013 progresses.
  • Despite a slight improvement compared to Q1 2012, spending remains subdued.
  • Looking ahead consumers remain concerned about rising utility prices.

2013 got off to an encouraging start with consumer confidence in disposable income improving for the fifth consecutive quarter.

The first quarter of 2013 has confirmed that the necessary conditions to reinvigorate consumer optimism are starting to emerge. In 2012 there were tentative signs of improvement: inflation fell which in turn helped to fuel a slight increase in discretionary spending. However, consumers remained cautious and continued to deleverage and save in anticipation of rising food and utility prices.

The latest Deloitte Consumer Tracker shows that in Q1 2013 confidence regarding disposable income is at its highest since the Tracker began in Q3 2011. There is less pressure on consumers' ability to spend as market uncertainty subsides and key macroeconomic indicators such as housing prices and retail sales start pointing in the right direction.

Moreover, consumers have healthier balance sheets, having worked hard to pay down some of their debt since the beginning of the economic slowdown. They are also reluctant to take on more debt, making the uptrend in consumer expenditure since the first quarter of 2012 even more significant. Recent Bank of England figures show that secured lending has fallen over the last four years, and although this reflects a drop in the number of housing transactions, it is also a sign that consumers are changing their attitude to debt. The consumer environment is also starting to improve. Although real earnings growth remains weak, and below inflation at just 0.3 per cent in 2012, it is better than the 1.7 per cent average annual contraction since 2008.

The question remains whether low debt interest and expectations of improving credit availability will be sufficient to give consumers enough confidence to continue to increase their spending in 2013. However with inflation forecast to rise in the next few months confidence could remain fragile.

Consumer confidence

Sentiment on disposable income is stronger than at any time since Q3 2011.

While household disposable income remains the main area of concern for consumers, it has continued to improve since the launch of the Deloitte Consumer Tracker in Q3 2011, showing a nine percentage point improvement compared to a year ago (from -40 per cent to -31 per cent).

  • Sentiment improved on all measures compared to the previous quarter.
  • Sentiment surrounding job security improved by three percentage points this quarter, the fastest rate since Q1 2012. Similarly debt levels at -9 per cent have nearly halved since the Tracker began in 2011.

  • Consumer confidence stabilised in Q1 2013 and is five points higher than at the same time last year, according to the GfK NOP consumer confidence index.

After falling steadily in 2012, consumer price inflation has edged up over the last three months reaching 2.8 per cent in February and remaining at that rate in March. The Bank of England expects that in the second half of this year inflation could rise above 3 per cent due to increasing energy prices and higher import costs.

Household disposable income

UK household conditions remain stable in the first quarter of 2013.

  • While 14 per cent of UK households saw a reduction in income in the first quarter of 2013, the same proportion of households received a pay rise or bonus.
  • People who received a pay rise or a bonus were twice as likely to be high income earners. In contrast those who saw a reduction of income were more likely to be from less affluent income groups.
  • This polarisation is reflected in the good performances reported by retailers at each end of the retail market.

  • Real earnings growth remained weak and below inflation, at just 0.3 per cent in 2012. However it is better than the average 1.7 per cent annual contraction since 2008.

  • In the final quarter of last year real spending was buoyed by rising prices in energy, food and drink, and clothing.
  • Overall real consumer spending has grown in each of the past five quarters by a total of around 2 per cent.

Economic outlook

The consensus is for the recovery to gain traction as 2013 progresses

  • There is still a risk that the economy could enter a triple dip recession, but the consensus is for the recovery to gain traction as 2013 progresses.

  • Recent official figures indicated that the labour market's recovery stalled for the first time in 16 months as employment fell.

  • Encouragingly, the latest Deloitte CFO Survey shows a strikingly broadâ€'based rise in confidence as British businesses look set to benefit from a less risky, and improving, global economic backdrop

Spending behaviour in the last quarter

Despite a slight improvement compared to Q1 2012, spending remains subdued.

  • Consumers spent more on utilities in Q1 2013 as a result of increased energy prices, while spending in discretionary categories continued to ease compared to a year ago.
  • Although clothing and footwear are showing an improved performance year on year, there was a deterioration in Q1 2013 following the coldest March on record.
  • Spending on main household appliances increased in Q1 2013, a sign that consumers are starting to consider buying bigger ticket items.

  • After four consecutive months at 2.7 per cent, despite food inflation easing, higher energy prices and the inclusion of student fees pushed inflation to 2.8 per cent in February. Inflation remained stable in March at 2.8 per cent.
  • According to consensus forecasts, inflation is likely to rise above 3 per cent in the second half of 2013 and fluctuate around this level into 2014.

To view this article in full please click here.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.

To print this article, all you need is to be registered on

Click to Login as an existing user or Register so you can print this article.

Similar Articles
Relevancy Powered by MondaqAI
In association with
Related Topics
Similar Articles
Relevancy Powered by MondaqAI
Related Articles
Related Video
Up-coming Events Search
Font Size:
Mondaq on Twitter
Mondaq Free Registration
Gain access to Mondaq global archive of over 375,000 articles covering 200 countries with a personalised News Alert and automatic login on this device.
Mondaq News Alert (some suggested topics and region)
Select Topics
Registration (please scroll down to set your data preferences)

Mondaq Ltd requires you to register and provide information that personally identifies you, including your content preferences, for three primary purposes (full details of Mondaq’s use of your personal data can be found in our Privacy and Cookies Notice):

  • To allow you to personalize the Mondaq websites you are visiting to show content ("Content") relevant to your interests.
  • To enable features such as password reminder, news alerts, email a colleague, and linking from Mondaq (and its affiliate sites) to your website.
  • To produce demographic feedback for our content providers ("Contributors") who contribute Content for free for your use.

Mondaq hopes that our registered users will support us in maintaining our free to view business model by consenting to our use of your personal data as described below.

Mondaq has a "free to view" business model. Our services are paid for by Contributors in exchange for Mondaq providing them with access to information about who accesses their content. Once personal data is transferred to our Contributors they become a data controller of this personal data. They use it to measure the response that their articles are receiving, as a form of market research. They may also use it to provide Mondaq users with information about their products and services.

Details of each Contributor to which your personal data will be transferred is clearly stated within the Content that you access. For full details of how this Contributor will use your personal data, you should review the Contributor’s own Privacy Notice.

Please indicate your preference below:

Yes, I am happy to support Mondaq in maintaining its free to view business model by agreeing to allow Mondaq to share my personal data with Contributors whose Content I access
No, I do not want Mondaq to share my personal data with Contributors

Also please let us know whether you are happy to receive communications promoting products and services offered by Mondaq:

Yes, I am happy to received promotional communications from Mondaq
No, please do not send me promotional communications from Mondaq
Terms & Conditions (the Website) is owned and managed by Mondaq Ltd (Mondaq). Mondaq grants you a non-exclusive, revocable licence to access the Website and associated services, such as the Mondaq News Alerts (Services), subject to and in consideration of your compliance with the following terms and conditions of use (Terms). Your use of the Website and/or Services constitutes your agreement to the Terms. Mondaq may terminate your use of the Website and Services if you are in breach of these Terms or if Mondaq decides to terminate the licence granted hereunder for any reason whatsoever.

Use of

To Use you must be: eighteen (18) years old or over; legally capable of entering into binding contracts; and not in any way prohibited by the applicable law to enter into these Terms in the jurisdiction which you are currently located.

You may use the Website as an unregistered user, however, you are required to register as a user if you wish to read the full text of the Content or to receive the Services.

You may not modify, publish, transmit, transfer or sell, reproduce, create derivative works from, distribute, perform, link, display, or in any way exploit any of the Content, in whole or in part, except as expressly permitted in these Terms or with the prior written consent of Mondaq. You may not use electronic or other means to extract details or information from the Content. Nor shall you extract information about users or Contributors in order to offer them any services or products.

In your use of the Website and/or Services you shall: comply with all applicable laws, regulations, directives and legislations which apply to your Use of the Website and/or Services in whatever country you are physically located including without limitation any and all consumer law, export control laws and regulations; provide to us true, correct and accurate information and promptly inform us in the event that any information that you have provided to us changes or becomes inaccurate; notify Mondaq immediately of any circumstances where you have reason to believe that any Intellectual Property Rights or any other rights of any third party may have been infringed; co-operate with reasonable security or other checks or requests for information made by Mondaq from time to time; and at all times be fully liable for the breach of any of these Terms by a third party using your login details to access the Website and/or Services

however, you shall not: do anything likely to impair, interfere with or damage or cause harm or distress to any persons, or the network; do anything that will infringe any Intellectual Property Rights or other rights of Mondaq or any third party; or use the Website, Services and/or Content otherwise than in accordance with these Terms; use any trade marks or service marks of Mondaq or the Contributors, or do anything which may be seen to take unfair advantage of the reputation and goodwill of Mondaq or the Contributors, or the Website, Services and/or Content.

Mondaq reserves the right, in its sole discretion, to take any action that it deems necessary and appropriate in the event it considers that there is a breach or threatened breach of the Terms.

Mondaq’s Rights and Obligations

Unless otherwise expressly set out to the contrary, nothing in these Terms shall serve to transfer from Mondaq to you, any Intellectual Property Rights owned by and/or licensed to Mondaq and all rights, title and interest in and to such Intellectual Property Rights will remain exclusively with Mondaq and/or its licensors.

Mondaq shall use its reasonable endeavours to make the Website and Services available to you at all times, but we cannot guarantee an uninterrupted and fault free service.

Mondaq reserves the right to make changes to the services and/or the Website or part thereof, from time to time, and we may add, remove, modify and/or vary any elements of features and functionalities of the Website or the services.

Mondaq also reserves the right from time to time to monitor your Use of the Website and/or services.


The Content is general information only. It is not intended to constitute legal advice or seek to be the complete and comprehensive statement of the law, nor is it intended to address your specific requirements or provide advice on which reliance should be placed. Mondaq and/or its Contributors and other suppliers make no representations about the suitability of the information contained in the Content for any purpose. All Content provided "as is" without warranty of any kind. Mondaq and/or its Contributors and other suppliers hereby exclude and disclaim all representations, warranties or guarantees with regard to the Content, including all implied warranties and conditions of merchantability, fitness for a particular purpose, title and non-infringement. To the maximum extent permitted by law, Mondaq expressly excludes all representations, warranties, obligations, and liabilities arising out of or in connection with all Content. In no event shall Mondaq and/or its respective suppliers be liable for any special, indirect or consequential damages or any damages whatsoever resulting from loss of use, data or profits, whether in an action of contract, negligence or other tortious action, arising out of or in connection with the use of the Content or performance of Mondaq’s Services.


Mondaq may alter or amend these Terms by amending them on the Website. By continuing to Use the Services and/or the Website after such amendment, you will be deemed to have accepted any amendment to these Terms.

These Terms shall be governed by and construed in accordance with the laws of England and Wales and you irrevocably submit to the exclusive jurisdiction of the courts of England and Wales to settle any dispute which may arise out of or in connection with these Terms. If you live outside the United Kingdom, English law shall apply only to the extent that English law shall not deprive you of any legal protection accorded in accordance with the law of the place where you are habitually resident ("Local Law"). In the event English law deprives you of any legal protection which is accorded to you under Local Law, then these terms shall be governed by Local Law and any dispute or claim arising out of or in connection with these Terms shall be subject to the non-exclusive jurisdiction of the courts where you are habitually resident.

You may print and keep a copy of these Terms, which form the entire agreement between you and Mondaq and supersede any other communications or advertising in respect of the Service and/or the Website.

No delay in exercising or non-exercise by you and/or Mondaq of any of its rights under or in connection with these Terms shall operate as a waiver or release of each of your or Mondaq’s right. Rather, any such waiver or release must be specifically granted in writing signed by the party granting it.

If any part of these Terms is held unenforceable, that part shall be enforced to the maximum extent permissible so as to give effect to the intent of the parties, and the Terms shall continue in full force and effect.

Mondaq shall not incur any liability to you on account of any loss or damage resulting from any delay or failure to perform all or any part of these Terms if such delay or failure is caused, in whole or in part, by events, occurrences, or causes beyond the control of Mondaq. Such events, occurrences or causes will include, without limitation, acts of God, strikes, lockouts, server and network failure, riots, acts of war, earthquakes, fire and explosions.

By clicking Register you state you have read and agree to our Terms and Conditions