Advertisement
Become a member of the Big Issue community
JOIN
Social Justice

UK inflation holds at 2.2% – but it's still a bleak picture for poorer people and benefit claimants

There are fears that the country remains unprepared for spikes in the inflation rate, which could happen more frequently amid the climate crisis. Meanwhile, millions of people are already struggling to afford the basics they need to survive even as inflation steadies

keir starmer

Keir Starmer has seen inflation remain steady since he became prime minister. Image: Simon Dawson/ No 10 Downing Street

It was four months ago that former prime minister Rishi Sunak seized the opportunity to boast about inflation’s drop to 2.3%, finally near target levels after more than two years of a brutal cost of living crisis.

Sunak announced a general election that same day – perhaps spurred on by some positive news – although of course we know now (and possibly knew then) that Labour would win in a landslide victory.

Inflation has remained steady since. It stood at 2.2% in August, according to the new figures from the Office for National Statistics released on Wednesday (18 September), the same figure as the previous month.

It means prices are still rising – by an average of 2.2% since August 2023 – but it’s far lower than the rates the country was seeing at the height of the cost of living crisis. In early 2023, inflation was above 10% and government intervention was urgent.

But should the government still be worried? Fran Boait, the director of campaign group Positive Money, warns that inflation cannot be ignored. Beyond emergency support, she argues that policymakers must look at long-term solutions to the causes of high inflation.

Boait said: “The price of many essentials haven’t gone down. If anything, it is still going up. We all need the right access to food. It’s scary that we are in one of the top seven wealthiest countries, and a lot of people that are unable to put food on the table.”

Advertisement
Advertisement

Recent research from Barnardo’s showed that a quarter of parents are still struggling to provide enough food for their children. This equates to 3.4 million children whose parents have struggled to afford food in the past year, an increase of 5% from October 2022.

And almost half of people receiving universal credit are running out of food and 1.6 million people claiming universal credit needed to use a food bank in the last year, according to the Trussell Trust. That’s approximately the population of Birmingham and Manchester put together.



The poorest have been worst impacted by high inflation rates and that’s because the cost of essentials like food were soaring at a faster rate, and low-income families typically spend a higher share of their income on the basics they need to survive.

As a result, the effective inflation rate for the poorest tenth of households is around 2% higher than it is for the richest tenth of households, figures from the Resolution Foundation have shown.

Andy Mielczarek, chief executive of Chetwood Financial, called the latest inflation figures a “further shot in the arm for both consumers and businesses” – but he was hopeful that this “relative period of calm sets the stage for continued recovery and brighter prospects”.

However, Boait fears that the country remains unprotected from price shocks, and she argues that more must be done to address the burgeoning sources of higher inflation – such as crop shortages caused by the climate crisis.

“The worry for us is, without that attention and that kind of wider conversation about what’s just happened over the last two years and what the policy tools are needed to address it, then it just becomes a bit of a non-event until there’s another shock, which we know there will be, and we also know those food prices will creep up,” Boait says.

“That’s really going to have the biggest impact on people struggling to get by. We have millions using food banks and not being able to afford the cost of food and, with climate change, that’s set to get worse.

“We want to talk about the wider context we’re living in, which is inflation driven by climate change, by fossil fuels, by corporate profits. The Bank of England and the Treasury should be looking at those underlying issues.”

The cost of living crisis has seen millions of people plunged into debt and living in poverty. People are already struggling now, with inflation at “normal” levels. How would they cope if faced with another shock to the country’s finances?

The energy market is volatile, and food prices are expected to rise as it becomes more difficult to access amid the climate crisis, and big corporations are continuing to make huge profits which drives up inflation.

Boait is urging policymakers to consider ways to protect the country in the long-term – through ensuring wages rise to match price rises, investing in solutions to tackle the climate crisis, and taxing corporations so that profits do not drive up inflation.

She adds: “They really need to be redesigning their policies to look at what’s happening to people who are struggling the most at this time.”

Do you have a story to tell or opinions to share about this? Get in touch and tell us moreBig Issue exists to give homeless and marginalised people the opportunity to earn an income. To support our work buy a copy of the magazine or get the app from the App Store or Google Play.

Advertisement

Become a Big Issue member

3.8 million people in the UK live in extreme poverty. Turn your anger into action - become a Big Issue member and give us the power to take poverty to zero.

Recommended for you

View all
Hundreds of thousands of pensioners miss out DWP pension credit worth £1,900: 'Disappointing'
pensioners
Pensioners

Hundreds of thousands of pensioners miss out DWP pension credit worth £1,900: 'Disappointing'

The real Byker Grove: Inside the youth clubs that inspired Ant and Dec's childhood TV classic
Youth worker Jennie Maughan at the Chevron youth centre in Byker
Youth clubs

The real Byker Grove: Inside the youth clubs that inspired Ant and Dec's childhood TV classic

Three million children are facing hunger in the UK – with kids under four most at risk
boy leaning back on a wall looking sad
Poverty

Three million children are facing hunger in the UK – with kids under four most at risk

Disability benefits system is damaging claimants' health, DWP's own analysis finds: 'It's degrading'
disability benefits
Disability benefits

Disability benefits system is damaging claimants' health, DWP's own analysis finds: 'It's degrading'

Most Popular

Read All
Renters pay their landlords' buy-to-let mortgages, so they should get a share of the profits
Renters: A mortgage lender's window advertising buy-to-let products
1.

Renters pay their landlords' buy-to-let mortgages, so they should get a share of the profits

Exclusive: Disabled people are 'set up to fail' by the DWP in target-driven disability benefits system, whistleblowers reveal
Pound coins on a piece of paper with disability living allowancve
2.

Exclusive: Disabled people are 'set up to fail' by the DWP in target-driven disability benefits system, whistleblowers reveal

Cost of living payment 2024: Where to get help now the scheme is over
next dwp cost of living payment 2023
3.

Cost of living payment 2024: Where to get help now the scheme is over

Strike dates 2023: From train drivers to NHS doctors, here are the dates to know
4.

Strike dates 2023: From train drivers to NHS doctors, here are the dates to know