Rishi Sunak still refuses to help ease the cost-of-living crisis by defying calls for a windfall tax on energy giants. Meanwhile, households must expect high costs
Rising inflation is causing untold misery for Britain’s poorest families as they struggle to survive.
The 3.1 million poorest households are hit by the cost of living that is rising faster than anyone else.
This means that while inflation has hit a 40-year high of 9% overall, it has risen by 10.9% for the poorest.
But for the richest 10% of households, it’s 7.9%, according to research from the Institute for Fiscal Studies.
Rishi Sunak still refuses to help ease the cost-of-living crisis by defying calls for a windfall tax on energy giants.
But the multimillionaire chancellor sparked fury tonight when he told business bosses he would cut their taxes. Pensioner Sheila Correll, 79, told how rising inflation means she can’t heat her home in Horncastle, Lincs.
The retired barrister, who is now barely making ends meet on her £184-a-week pension, is shocked that inflation is more to her than wealthy Mr Sunak.
Sheila, whose gas and electricity bill has skyrocketed from £38 to £93 a week, said: “That’s absolutely unfair. We are among the worse, but no one in Parliament seems to care.
“The government has no idea how real it is to live on £184 a week when the wealthiest have the lowest inflation rate.”
Households in the IFS study included a couple making ends meet on less than £287 a week after tax, or a family of four on less than £401 a week for all their bills and expenses. But the richest households included a couple with a net income of over £1,163 a week or a family with £1,623 a week.
Poorer households have to spend more of their income on energy and food, both of which have risen sharply.
Goods that were reasonably cheap are so expensive now, but incomes have not risen in line with prices, so they cannot afford to buy as much.
Many are now turning to food banks just to survive.
While richer families who buy more expensive goods can resort to cheaper items.
Citizens Advice said “the warning lights couldn’t be flashing brighter”.
Chief Executive Dame Clare Moriarty added: “There are desperate stories behind these numbers. People washing in their kitchen sinks because they can’t afford a hot shower, parents skipping meals to feed children, people with disabilities who can’t afford to use essential appliances because of rising energy costs.”
Imran Hussain, Action for Children’s Director of Policy and Campaigns, said: “The financial hardship experienced by our staff is among the worst they can remember and is depriving too many children of the bright future they deserve.
“Many low-income families are struggling to pay their bills and cover the absolute basics, and some are going into debt.”
According to the IFS, the poorest households spend 11% of their total budget on gas and electricity, compared to 4% for the richest households. Rising food costs are another factor, with the ONS revealing that prices rose 6.7% in the year to April, the fastest in 11 years.
Tom Maddick SWNS)
IFS research economist Heidi Karjalainen added: “Government benefits increased by just 3.1% in April. This means large real cuts in the living standards of many of the poorest households.
“We are probably in an extended period of poorer households facing inflation rates higher than the headlines suggest.” Prospect Union secretary general Mike Clancy said: “These stunning inflation figures will mean that Workers have to make impossible decisions about what to cut from the family budget just to make ends meet, while wage inequality widens as the top 1% of earners see big wage increases last month.”
TUC General Secretary Frances O’Grady added: “Conservative MPs keep telling families that there is no cost of living crisis, it is their own fault if they stop working or eat the wrong food.
“But with inflation this high, the crisis is a cold, hard reality.
“And families are desperate for government help with an emergency budget.
Andy Commins/Daily Mirror)
“And we desperately need a windfall tax on oil and gas.”
Mr Sunak has tried to blame global events such as rising energy prices and the war in Ukraine for the cost of living crisis.
But other countries have kept inflation rates low. Italy is at 6%, France at 4.8% and Japan at just 1.2%. And while the Chancellor insists on telling ailing Britons there is little he can do to help or making empty promises, he was far more helpful to business leaders last night.
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Mr Sunak told the CBI dinner he will cut their taxes this fall, saying: “We are on your side.
“We need you to invest more, educate more and innovate more.
“In the fall budget, we’re going to cut your taxes to encourage you to do all these things.”
Lib Dem MP Christine Jardine said: “Rishi Sunak promises tax cuts for businesses while increasing taxes for families. It shows he’s completely out of touch.”
https://www.mirror.co.uk/money/poor-brits-hit-hardest-inflation-27003890 Poor Brits are hit hardest as inflation rises 10.9% - but only 7.9% for rich households