All demographics will see costs increase by about 2.7 per cent, IFS finds
The fall in sterling is driving up cost of living across all demographics and income groups, the IFS has observed, with households expected to face an average increase of about 2.7 per cent.
The analysis was released today, after the ONS announced that CPI inflation rose to 0.9 per cent in the year to October.
Since about 40 per cent of food is imported, it is expected to experience a relatively high price increase of about 2.9 per cent. This effect is already already starting to appear, albeit in the trivialised form of Marmite-gate and Toblerone-gate.
The rise in food prices will hit poor households particularly hard, since poor families spent 25 per cent of their income on food, compared to the 16 per cent average.
While wealthier households will be hit disproportionately by increases in holiday, furniture and costs, that’s because many poor households do not spend on these items in the first place. Moreover, holiday or furniture costs can typically be reduced more easily than food intake, and wealthier households are better able to absorb increased costs.
Recognising the threat rising costs presents to many families’ living standards, TUC general secretary Frances O’Grady has called on Philip Hammond to ‘use the Autumn Statement to end the public sector pay cap and announce an increase to the national minimum wage.’
Susan Kramer of the Liberal Democrats also called for government action, arguing that their ‘blinkered attitude to Brexit’ is preventing them from seeing the warning signs.
‘They should be leading by example,’ she continued. ‘Ensuring that teachers, nurses and public sector workers get a proper pay rise to cope with rising prices, rather than continuing to cap pay increases at one per cent.’
See also: Austerity has failed – the Autumn Statement should (but won’t) reflect that
5 Responses to “Project Fear? Poor families will be hit hardest by rising food prices”
Michael WALKER
Sorry but the chart and your headline look out of step..
Mick
LFF MISSION STATEMENT: Pick a trend you don’t like, something you blamed on Tories anyway, then pin it to Brexit.
Like with Maggie Thatcher, the Left can’t directly control events and leaders, so thus try to poison reputations.
The Pound has held and fluctuations have happened before Brexit too. There’s no guarantee any skies will fall in, especially before we’ve even left. And where Lefties bitch about higher import charges, I thought they liked protectionism. Well, only on their terms, in which case pricier food and goods are OK.
The last wobble in the Pound couldn’t be blamed on Brexit. Not even the economics guy the BBC could dredge up could do that. And lefties just rush to do it here.
We voted Brexit. Instead of concocting outrages to annoy Brexit voters with, suppress that left-wing haughtiness and actually expose genuine trends.
Hiba Sameen
I agree the chart is misleading – but I think the point is that the poorest will see an increase of about 2.5%, up to 27.5% (as they already spend 25% of their income on food), compared to an increase of 2.8% for the richest, up to 17.8% ( as they spend 16% of their income on food). The point that the poor will be hardest hit still holds (in terms of levels, if not in terms of increments).
Michael WALKER
I agree with Hiba above.
But my eyes caught this:
“Susan Kramer of the Liberal Democrats also called for government action, arguing that their ‘blinkered attitude to Brexit’ is preventing them from seeing the warning signs.
‘They should be leading by example,’ she continued. ‘Ensuring that teachers, nurses and public sector workers get a proper pay rise to cope with rising prices, rather than continuing to cap pay increases at one per cent.’”
So teachers, nurses and teh public sector are poor?
(I agree that the menial jobs my be poorly paid.. but Teachers?
And who is going to pay for it? Taxpayers of course- many of whom ARE poorly paid.
It’s this kind of muddled – and often moronic – statements by politicians which conflates two separate issues – and damages both causes.
Mind you, the speaker was a LibDem… so hardly surprising.:-)
Mick
The Liberals weaponising Brexit. Well, THEY have the boosted numbers in Parliament to vindicate their spite, haven’t they! No?
Oh.
I’ll be glad when all of Labour’s old fiscal booby traps have been defused, then everyone can have more food on the table again.