Cost of living

Wednesday

Kate Andrews

Britain’s cost of living crisis worsens

If Boris Johnson manages to cling on to his job, he’ll have much more than the parties of lockdowns past to worry about. Britain’s cost of living crisis is worsening still, with CPI inflation rising by 5.4 per cent in the 12 months leading up to December last year. This has, once again, outpaced consensus, surging even further past the Bank of England’s most recent official forecast. There’s little doubt left that heavy government spending is playing a significant role in the inflation we’re experiencing now Inflation is now at a 30-year high. And it’s still rising. Capital Economics now estimates a peak of 7 per cent around April, and there is once again increasing speculation that December’s interest rate rise to 0.

Thursday

The Spectator

The cost of living – not Covid – could bring Boris down

Two and a half years into his premiership, Boris Johnson has enjoyed no more than a month of that time unencumbered either by Brexit negotiations or the public health emergency. Once Britain is through the worst of the Omicron wave, it would be understandable if the Prime Minister wanted to pursue some kind of political vision. The danger is that, as normality returns, his premiership will be further imperilled by the cost of living. An economic crisis is expected to hit households in April. In that month, National Insurance contributions (NICs) will go up by 1.25 per cent, a direct violation of Johnson’s manifesto pledge to protect voters from tax rises. The price cap on energy bills will also be raised, possibly doubling some customers’ costs as they come off fixed rates.

Wednesday

James Forsyth

Energy bills are Johnson’s next big battle

Keir Starmer is not a lucky politician. He has again been forced into self isolation after testing positive for Covid, which means he misses the first PMQs of the year. This is the Labour leader’s sixth period of self-isolation. So, instead it will be Rayner versus Johnson at PMQs at the later time of 3 p.m. this afternoon. These contests are normally more hammer and tongs than the Johnson–Starmer ones. Rayner’s style is more direct than Starmer’s; and is often more effective in rattling Johnson.  The obvious area for her to go on today is cutting VAT on household energy bills. Labour is already in favour of this and Tory MPs are getting increasingly agitated about the issue.