‘'The cost of living crisis is not over – no matter how much ministers pretend it is’
UK inflation fell from 3.2% to 2.3% in April, its lowest level in three years – having hit its highest rate for 40 years of 11.1% in October 2022. Nonetheless Tory MPs are taking the opportunity to bask in the news as Rishi Sunak said “today marks a major moment for the economy, with inflation back to normal”.
However, for the millions affected by a continued cost-of-living crisis, it is not the time for Tory Ministers “to be popping champagne corks”, shadow Chancellor Rachel Reeves said, as many have been are quick to highlight the bigger picture on the state of the UK economy.
Shadow Chief Secretary to the Treasury Darren Jones MP pointed out that inflation is still higher than the Bank of England’s 2% target, as he slammed the Tories for “years of chaos” that “people have already paid the price” for, telling Conservatives to “get off the victory lap”.
Trade union leaders have accused the Tories of presiding over the worst living standards for generations, as Paul Nowak, General Secretary of the Trades Union Congress (TUC) said the cost of living crisis “is not over – no matter how much ministers pretend it is.”
Soaring mortgage repayments and increased food and energy bills are still affecting many people, Nowak has stressed, in light of the recent inflation figures.
“While it’s good the inflation rate is lower, millions up and down the country are still having to cut back on everyday essentials as they struggle to makes end,” Nowak said.
“That’s because household budgets have been decimated by the highest price rises in the G7 and wages have flatlined over the last 14 years.”
Recent polling by the TUC found that nearly 6 in 10 people said their living standards had not got better this year, and just 14% said they had improved.
General Secretary of the UK’s second biggest union Unite warned Tory ministers can’t brush off the damage inflicted by the country’s inflation crisis, with has affected a generation of Britons.
“We are not out of the woods,” said Sharon Graham. “Over the past three years prices have risen by 29 per cent, while wages have lagged far behind. The inflation crisis has meant a generational drop in living standards, and we’re a long way from catching up.”
Graham highlighted the union’s research on soaring corporate profits as evidence that recent inflation was driven largely by companies profiteering “at our expense”, as she said the only clear solution to tackling inflation was “workers organising to get their fair share”.
The Resolution Foundation warned that services inflation remains elevated and that the legacy of higher prices “are here to stay”. With food price rises of 32% and energy price rises of 67% since July 2021, the think tank said it is the poorest families who spend a greater proportion of their income on essentials, who face the biggest challenge.
Others have also issued reminders that lower inflation does not mean lower prices, but prices rising less quickly.
Money saving expert Martin Lewis wrote on X: “The PM talks about people “feeling the benefit” of lower inflation. Yet lower inflation still means rising prices (on top of previous high rises)
“A more accurate phrase would be “stopping feeling increased pain”.
Political researcher Philip Proudfoot said on X: “Inflation falling doesn’t mean things are getting cheaper. What it means is that during the massive 10%+ inflation surges — if you did not get a pay rise that at least matches it — you’ve had another massive real terms pay cut. Things are not just getting more expensive, slower.”
It comes as official figures also revealed today that Government borrowing in April was higher than estimated, hitting £20.5bn, the fourth-highest April since records began in 1993, in a further blow to Chancellor Jeremy Hunt.
Grilled this morning about the state of the economy and whether he himself felt wealthier, Hunt dodged the questions about his personal wealth and told the BBC Today programme that people in the UK feel “bruised and battered” but that “we should be confident about our future”.
Hannah Davenport is news reporter at Left Foot Forward
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