Britain’s high street suffered a ‘bad start to the festive season’ as a squeeze on energy bills and ebbing consumer confidence hit sales, according to industry figures.

It is the latest setback for the beleaguered retail sector as it grapples with a huge rise in costs imposed by Labour’s Budget.

Sales fell by 3.3 per cent in the four weeks to 23 November compared to the same period last year, according to the British Retail Consortium (BRC). It was the worst decline since April this year.

However, the comparison was skewed by the fact that Black Friday fell within the period in 2023 but not this time as it came later in the month.

BRC chief executive Helen Dickinson said: ‘While it was undoubtedly a bad start to the festive season, the poor spending figures were primarily down to the movement of Black Friday into the December figures this year.

‘Even so, low consumer confidence and rising energy bills have clearly dented non-food spending.’

It comes after a rise in the cap on energy prices in October pushed average annual energy bills up by £149 – and the costs began to bite as temperatures dropped across Britain. A further £21 increase will take effect from 1 January.

And last week, separate figures from the BRC showed consumer confidence remained weak ‘with many worried about the economy in the lead up to Christmas’.

Britain’s high street suffered a ‘bad start to the festive season’ as a squeeze on energy bills and ebbing consumer confidence hit sales, according to industry figures (picture: Oxford Street on Black Friday)

It comes after a rise in the cap on energy prices in October pushed average annual energy bills up by £149 – and the costs began to bite as temperatures dropped across Britain (file image)

BRC chief executive Helen Dickinson said: ‘While it was undoubtedly a bad start to the festive season, the poor spending figures were primarily down to the movement of Black Friday into the December figures this year

The retail sector is already reeling from the Budget, which brought in a sharp rise in the minimum wage as well as a £25 billion raid on employer national insurance.

Combined with the introduction of new taxes on packaging, it is expected to cost retailers an extra £7 billion next year, according to the BRC.

Ms Dickinson said: ‘How effectively the government works the industry to mitigate these costs will determine the extent of price rises and job losses in the future.’

Last month, 81 retailers including Tesco, Marks & Spencer and Sainsbury’s wrote to Rachel Reeves warning that the Budget could result in job cuts, shop closures, lower wages and higher prices.

The BRC figures are the latest evidence of economic damage being caused by the Chancellor.

A business survey published yesterday by the Confederation of British Industry (CBI) showed the outlook has taken ‘a decisive turn for the worse’.

It found private sector firms believe activity will fall in the next three months – the first time this year that expectations have turned negative.