Labour’s Rachel Reeves has said that rising inflation is leaving families “worried sick about making ends meet” after it was announced that UK inflation had risen to above 10% for the first time in 40 years.
The Office for National Statistics (ONS) revealed that the consumer prices index (CPI) rose by 10.1% in the 12 months to July, up from 9.4% in June. It said rising food prices were the primary cause of the increase between June and July.
The Shadow Chancellor of the Exchequer said: “We must get a grip on rising inflation leaving families worried sick about making ends meet.
“Labour’s fully-costed plan to freeze the energy price cap will bring inflation down this winter easing the burden on households and businesses. And it will mean that households won’t pay a penny more for their energy bills this winter.”
The ONS revealed that the annual inflation rate of food and non-alcoholic beverages rose to 12.7% in July, with an overall increase of 2.3% between June and July – the highest monthly increase since May 2001.
TUC general secretary Frances O’Grady said: “Families are facing a cost-of-living emergency. Ministers must cancel the catastrophic rise to energy bills this autumn. And to reduce future inflationary pressures and make energy more affordable, they should bring energy retail into public ownership.
“To help people with the cost of living this winter, government should bring forward increases to Universal Credit and the national minimum wage.
“And companies that were supported by taxpayers through the pandemic must step up to help too. They should show profit restraint to help keep prices down and to prioritise pay rises for staff.”
Chancellor Nadhim Zahawi said: “Getting inflation under control is my top priority, and we are taking action through strong, independent monetary policy, responsible tax and spending decisions and reforms to boost productivity and growth.”
The Bank of England predicted earlier in August that inflation will continue to rise in the coming months, to around 13%, largely as a result of increases in the price of gas. It projected that the UK will enter recession from the fourth quarter of the year and that real household post-tax income will “fall sharply in 2022 and 2023”.
Commenting on today’s announcement, Unite general secretary Sharon Graham said: “Today, inflation reached new perilous levels for workers and their families. Yesterday, real wages fell to the lowest on record.
“So, if today’s figures prove anything, it’s that wages are not driving inflation. Since the pandemic, the FTSE top 350 have seen profits soar by 43%. Britain has a profiteering crisis – when is something going to be done about that?”
GMB general secretary Gary Smith said: “Inflation is skyrocketing, with food and energy prices going through the roof. Eating and heating are basic human needs, yet many hard-working people in our country are at the limit of what they can pay to put food on the table and power their homes.
“Meanwhile, the Bank of England and our zombie government have lost control and look on helplessly as decent people are plunged into poverty. For so many, the cost-of-living crisis is rapidly becoming a catastrophe.”
UNISON assistant general secretary Jon Richards declared: “Wages are slumping at a record rate while prices and bills shoot up.
“But the government and those angling to be the next PM appear indifferent to the plight of those struggling to make ends meet. Ministers are deluded if they think workers can put up with yet more misery. Above-inflation pay rises are essential to rescue families on the brink.”
Chief economist at the Joseph Rowntree Foundation Rebecca McDonald said inflation is “eating away at people’s pay and leaving millions adrift”.
She declared: “Today’s sobering reading means the next few months will be profoundly more difficult for low-income families almost certainly experiencing a higher degree of inflation themselves.
“People are looking for a sign that help is on the way. Yet the government doesn’t seem to have grasped the full scale and urgency of this situation.”
“Planning for a substantial support package, at least double what’s been offered, needs to start immediately. Without one, vulnerable people will face a catastrophe on a vast scale when winter sets in,” McDonald added.
The ONS released its latest labour market statistics on Tuesday, which found that real-terms regular pay fell by 3% over the last quarter when adjusted for inflation – the fastest decline since comparable records began in 2001.