UK households in every region had more to spend in the first quarter of 2025, but policy changes could put further pressure on bills in the coming months, according to Asda’s Income Tracker.

The supermarket giant’s latest data found that all UK households were £25 better off on average in the months up to March than in 2024, with an average disposable income of £257 per week after paying bills and spending on essentials.

Regionally, London enjoyed the highest disposable income after bills, averaging £334 per week, while the East Midlands, Scotland and the North West also saw their spending powers exceed pre-pandemic levels.

Asda said that the improvements seen across regions are due to lower inflation compared to the same period last year. This has helped slow the growth of essential spending to 3.5% in the first quarter of 2025, down from 4.7% over the same period in 2024. 

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However, annual gross income growth did slow to 5.6%, down slightly from 5.7% during the same period last year across nearly all UK regions in the three months ending in March.

As a result, business and economic consultancy Cebr, who compile the tracker, projects that spending power of households may come under pressure in the coming months, due to the cooling job market, higher utility bills and cuts to welfare spending. 

Cebr senior economist Charlie Cornes said: “The Income Tracker grew in the first quarter of the year, though at a slower pace than the previous quarter. In the months ahead, spending power may come under pressure due to a range of policy changes.

“Higher utility bills, cuts to welfare spending, and rising employer costs are all likely to impact consumers. However, these impacts are expected to be partially offset by continued income growth, as wages are projected to rise faster than headline inflation for the remainder of the year.”