Inflation hits 30-year high as the UK lurches towards a cost of living crisis

“Energy costs are pushing inflation to its highest level in 30 years, and energy bills are the expense of most concern to households. Pay growth is relatively strong at a little under 4%, but this is out-paced by the combination of inflation and increased National Insurance Contributions due to take effect from April.

“Following two years of extraordinary measures from the Government to deal with the pandemic, we find ourselves lurching towards a cost of living crisis. All eyes will be on the Chancellor this afternoon as he weighs up his options to help.”

Background

Royal London’s recent research on the cost of living found:

• 95% of UK adults are concerned about the rising cost of living, with households across the earnings spectrum worried – as much concern among those with six-figure incomes as lower-earners
• Energy bills (92%), food shopping (87%) and cost hikes to phone and internet contracts (84%) are causing the most concern
• Saving levels also likely to take a hit with half (48%) of full-time workers saying they’ll reduce or stop saving altogether
• Worryingly, a fifth (21%) of people plan to borrow their way out of trouble, with 7% admitting they simply don’t know how they’ll cover increases and 5% saying they’re considering a short-term (payday) loan