The New Economics Foundation (NEF) says that 23.4 million people in the UK will be short by more than £8,500 a year for income needed to pay for essentials including food, heating and clothing by next month.
By April, half of UK children will be in families that cannot afford the cost of living, a new report has warned, amid rising energy prices and food and fuel costs.
The New Economics Foundation (NEF) says that 23.4 million people in the UK will be short by more than £8,500 a year for income needed to pay for essentials including food, heating and clothing by next month.
The think-tank also warns that 43% of families in the North East will be living below the minimum income threshold from April, as well as 41% in Yorkshire and the Humber, 39% in the West Midlands and 38% in London.
The New Economics Foundation’s findings come as the Resolution Foundation also warns that rising food and energy prices could cause a “second peak” in inflation of above 8% in the autumn. The think tank says that the poorest households will be hardest hit, experiencing an inflation rate of as much as 10%, due to spending a higher proportion of their household budget on food and fuel.
Sam Tims, an economist at NEF, said: “The cost of living is increasing faster than at any point in recent history. While all families are set to feel a squeeze come April, the lowest-income households will be hit proportionately harder. There is little time left for the chancellor to take action to avert the worst real-terms incomes squeeze in 50 years.”
The think tank is calling for a new social security system that guarantees everyone a minimum income floor, which would include uprating benefits by the latest level of inflation to ensure that incomes rise alongside prices and restoring the £20 uplift to universal credit.
The findings come as shadow transport secretary, Louise Haigh, warns that rising global oil prices in the wake of Russia’s invasion of Ukraine mean the average family would spend an extra £386 on petrol in the year ahead.
“This is a savage extra cost for millions of working people,” she said, renewing Labour’s call for the government to impose a windfall tax on oil companies profiting from surging prices.
“The Conservatives could help working people being hit hard by soaring prices; instead they’ve rejected the choice of a one-off windfall tax on oil and gas producers raking in billions. And to add insult to injury, within weeks they want to clobber families with a huge tax hike,” she added.
Basit Mahmood is editor of Left Foot Forward
To reach hundreds of thousands of new readers and to make the biggest impact we can in the next general election, we need to grow our donor base substantially.
That's why in 2024, we are seeking to generate 150 additional regular donors to support Left Foot Forward's work.
We still need another 124 people to donate to hit the target. You can help. Donate today.