Paying the price

How the inflation surge has reshaped the British economy

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The UK has experienced its highest inflation for more than 40 years, following Russia’s invasion of Ukraine. But next week will bring the welcome news that inflation has returned close to the 2 per cent target for the first time since July 2021. In this briefing note we take a step back and look at … Continued

Pressure on pay, prices and properties

How families were faring in October 2023

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Two years into the cost of living crisis, inflation has finally turned a corner. The headline rate of CPI inflation has fallen from its October 2022 peak of 11.1 per cent to 4.6 per cent in October 2023, and the Prime Minister has been able to say that his target of halving inflation in 2023 … Continued

Food for thought

The role of food prices in the cost of living crisis

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The cost of living crisis is often thought of as a cost of energy crisis. That is an understandable, but increasingly inadequate, view. In particular, it understates the growing role of food prices (up by 25 per cent over the past year and a half) in the squeeze on living standards that households – especially … Continued

Hoping and coping

How families were faring in March 2023

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Families in the UK found themselves in the midst of a cost of living crisis over the winter. Inflation has skyrocketed over the past year, with prices still over 10 per cent higher than a year ago. In response to the squeeze, the Government provided £47 billion of support to households in 2022-23, offsetting around … Continued

The only way is down

Assessing the impact of falls in wholesale energy prices on household and public finances

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Huge rises in energy prices through much of 2022 sparked a cost of living crisis with recession-level hits to family (as inflation soared) and public finances (as the state partially protected us from bill rises). But there has finally been some good news with wholesale gas prices for 2023-24 down more than 70 per cent … Continued

Costly differences

Living standards for working-age people with disabilities

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The cost of living crisis has shone a harsh light on different groups’ ability to deal with fast- rising prices. In this briefing note, we focus on the living standards of people with disabilities, including results from a new survey of just under 8,000 working-age adults, over 2,000 of whom reported a long-term illness or … Continued

A chilling crisis

Policy options to deal with soaring energy prices

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This briefing note, released just ahead of the announcement of the winter 2022 energy price cap level, looks at the implications of an unprecedented jump in energy costs on low-to-middle income households, stresses the need for urgent and novel policy thinking to lessen this blow, and outlines how this could take shape.

Cutting back to keep warm

Why low-income households will have to cut back on spending by three times as much as high-income households this winter

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This winter, low-income households will have to reduce their spending by three times as much as high-income households in order to afford their energy bills – a situation that is particularly concerning now that we know energy bills in January-March 2023 are set to be an annualised £4,266, rather than the £2,800 expected earlier this … Continued

Cap off

Understanding the April 2022 inflation release

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Inflation reached a 40-year high in April off the back of a sharp rise in energy bills and the highest food price inflation in a decade. These recent drivers of inflation mean that lower-income families are facing the most severe cost pressures, with their inflation rate already hitting double digits. Families are already responding to … Continued

Stressed out

April brings an acute squeeze on UK living standards as higher energy bills lead to widespread fuel stress

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April 2022 will see the UK’s cost of living crisis intensify as energy prices jump by more than half overnight, pushing 5 million English households into fuel stress, even accounting for support measures recently announced by the Chancellor. This is not the end, though. Against a backdrop of the highest inflation rate in 40 years … Continued

The price is right?

The April 2022 energy price rise and the Government’s response

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The Government has opted for universalism and minimising the hit to the public purse in its response to the energy price rise yesterday. The announced measures take the sting out of Ofgem’s £693 rise in the energy price cap in April with a broad-based package of support. All households will get a £200 discount on … Continued

The big squeeze

Assessing the changes to family incomes over the next six months

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This winter will see a major income squeeze – and it will be focused on low-to-middle income households. High inflation, especially higher energy bills, will strain many families’ finances. But these pressures will be compounded for over 4 million families when £20 a week is cut from Universal Credit in October 2021. Looking forward, April … Continued

The going rate: moving from CPI to CPIH and the inflation experiences of UK households

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The period of ultra-low inflation is over. CPI inflation is expected to rise above 2 per cent in the near future, eating into earnings and making benefits less generous. This coincides with a change in the way we measure those price rises, with a new main measure of inflation. On 21 March, CPIH will replace … Continued

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