A cost of living crisis is what the average UK family is facing this year. According to the ONS prices of everything from food to furniture have increased at their fastest rate in almost three decades. Mortgage rates are rising, along with, inflation, council tax and national insurance. The only things that don’t seem to be keeping up are wages - with pay packets having recently shrunk for the third time in a decade. The current crunch is also set to turn into a catastrophe in April when taxes along with energy bill caps increase. Data shows it is the poorest that will be hardest hit- so what needs to be done to combat the crisis? Is the government’s response of energy loans and council tax rebates enough?
Current policy proposals range from VAT cuts to energy bills, to calling for a full emergency budget. But will these measures target support at those who need it most, or should more support be given directly through the benefits system? And while the government has the biggest role to play in easing the burden on the average person, what can the private sector do to assist? Now that the focus is shifting from the coronavirus pandemic, we must consider the long term structural changes needed alongside short term measures to combat the cost of living crisis this year.
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