Inflation worst for 41 years
11.1% rate sparks plea for action
THE UK’s inflation rate has now hit 11.1%, the highest level in 41 years, due to soaring energy and food costs.
The worse-than-expected figure for October will fuel demands for Rishi Sunak to do more to ease the cost of living emergency in today’s Autumn Statement.
The Prime Minister acknowledged that surging inflation is causing “anxiety” among people as they see their bills surge.
Experts also warned of a “lethal combination of recession and runaway inflation” unless Chancellor Jeremy Hunt sets out measures to ease the burden.
In September, the Consumer Price Index’s rate of inflation stood at 10.1% but shot up a percentage point last month to its highest level since 1981, figures yesterday revealed.
The Office for National Statistics said gas prices had increased nearly 130% over the year, and electricity by around 66%.
The data showed the rate of inflation across food and non-alcoholic drinks hit 16.4% – the highest rate since 1977.
Due to the poorest households spending a greater proportion of their expenditure on energy and food, they have experienced the sharpest jump in living costs.
A separate report by the ONS showed the poorest 10% of households had a 12.5% rise, while the richest 10% were on
9.6%. Figures also revealed private rental prices increased by 3.8% in the 12 months to October. As the PM flew back from the G20 summit in Bali last night he said the Government would set out a plan to “grip” inflation and decisions will be based on “compassion”. Meanwhile, the Chancellor will today warn of difficult decisions and say that high inflation is the “enemy of stability”.
He will add: “It means higher mortgage rates, more expensive food and fuel bills, businesses failing and unemployment rising. “It erodes savings, causes industrial unrest, and cuts funding for public services. It hurts the poorest the most and eats away at the trust upon which a strong society is built.” Labour’s Shadow Chancellor Rachel Reeves said the latest rate of inflation will “strike more fear in the heart of families”. Senior economist at the Resolution Foundation, Jack Leslie, warned: “The Chancellor needs to protect vulnerable households.” Frances O’Grady, general secretary of the Trades Union Congress, said family budgets are “being shredded” by the cost of food and energy.