If his income is $1$ his expenditure is $0.8$ and savings is $0.2$.
His income increases to $1.2$ and savings to $0.2(1+0.12)=0.224$.
His new expenditures are $1.2-0.224=0.976$.
The percentage expenditure in expenses is $\frac {0.976}{0.8}-1=0.22=22\%$