Resolution Foundation says UK households almost £3,000 worse off
New analysis from the Resolution Foundation says the average UK household is £2,900 worse off than if inflation had been steady, with lower-income households hit hardest.
The Full Story
A plain summary built from the channels that reported this story.
New analysis from the Resolution Foundation, a living standards think tank, says the average UK household is £2,900 worse off than it would have been if inflation had stayed more steady. The report puts a figure on a near continuous cost of living crisis over the past five years.
According to the analysis, the UK has experienced 13 years' worth of normal price increases in just five. Inflation has been above the Bank of England's 2% target for the majority of that period, sometimes much higher, peaking at more than 11%.
Several factors drove prices up: soaring demand after the pandemic, Russia's invasion of Ukraine, conflict in the Middle East, and turmoil in the mortgage market. Households have faced higher energy bills, with costs 70% above pre-pandemic levels. The gas and electricity price gap is set to rise for millions again this winter, while water bills and food prices have also gone up.
Wages are currently rising by more than prices, which is helping living standards, but this was not the case for periods of the past five years. The pain has not been felt equally. Lower-income households spend more of their money on energy and food, and the number of people falling behind on these bills has doubled.
The Resolution Foundation is calling for targeted help, especially given the state of public finances. The government said the Chancellor knew the impact of higher prices and was focused on giving people breathing space. It pointed to measures including taking VAT off electricity bills, capping bus fares in England, and extending a fuel duty cut. It also said any future help would be a decision for the budget in just under three weeks.
On screen
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Key Claims
Claims reported during this story's coverage, grouped by how many channels reported each one. Select a dot to see the source excerpt.
| Claim |  |
|---|---|
| Only on one channel | |
| Inflation has exceeded the Bank of England's 2% target for most of the past five years, peaking above 11%. | |
| The government listed support measures including removing VAT from electricity bills, capping bus fares in England, and extending a fuel duty cut. | |
| The Resolution Foundation estimated that average UK households are around £2,900 worse off than they would have been if inflation had been steadier. | |
Channel Perspectives
What each channel focused on, with key quotes.
BBC ONE West gave the Resolution Foundation report a prominent segment in its lunchtime bulletin, leading with the almost £3,000 figure and the finding that poorer households have been hit hardest. It used a chart to show inflation against the Bank of England's 2% target and traced causes from pandemic demand to the Ukraine and Middle East conflicts. The report also set out the government's response, including existing support measures and the upcoming budget.
- “the cost of living crisis has left the average household almost £3,000 worse off than it would have otherwise been”
- “A report by a leading think tank says the impact of rising prices over the past five years has been felt most sharply by the poorest households.”
- “The Resolution Foundation is saying what lots of people had suspected, that the past five years have felt like a near continuous cost of living crisis.”
Broadcast Timeline
News broadcasts tracked for this story, in time order.