PM statement on halving inflation and reaction

Prime Minister Rishi Sunak said:

“Inflation works like a tax. It eats into the pound in your pocket, affecting the price of your food shop, your mortgage, the size of your pension pot. This is why halving inflation has been my number one priority.

“Getting it down has involved hard decisions and fiscal discipline.

“Official figures released this morning confirm we have halved inflation meeting the first of the five priorities I set out at the beginning of this year.

“But while it is welcome news that prices are no longer rising as quickly, we know many people are continuing to struggle, which is why we must stay the course to continue to get inflation all the way back down to 2%.”

Rachel Reeves MP, Labour’s Shadow Chancellor, responding to the latest inflation figures, said:

“The fall in inflation will come as some relief for families struggling with the cost of living. But, now is not the time for Conservative ministers to be popping champagne corks and patting themselves on the back.

“After thirteen years of economic failure under the Conservatives, working people are worse off with higher mortgage bills, prices still rising in the shops and inflation twice as high as the Bank of England’s target.

“Rishi Sunak is too out of touch and his party is too divided to help people who are worried about the cost of living. A Labour government’s priority would be making working people better off by boosting wages, cutting people’s bills and getting the economy growing again.”

Inflation stats: A cold comfort as families see pay squeezed on all sides 

The Liberal Democrats have slammed the Government for celebrating new inflation figures as research by the party reveals average earners have seen their annual wages eroded with a real terms cut of almost £700. 

Commenting, Liberal Democrat Treasury spokesperson Sarah Olney MP said: 

"Rishi Sunak congratulating himself over today’s figures will be cold comfort for all the hard-working people still bearing the brunt of this Conservative chaos. 

"For months on end, people across the country have been watching as their pay cheque gets squeezed from all sides, draining every spare penny. From the ever-increasing cost of the weekly shop to skyrocketing mortgage payments. 

"Enough is enough. With next week’s Autumn Statement the Government must properly help families and pensioners struggling with the cost-of-living crisis and give our NHS the funding it desperately needs.”

ENDS

Notes to Editor:

Liberal Democrat analysis of inflation figures was reported first by The Times. 

House of Commons Library research and Liberal Democrat analysis can be found here. (Liberal Democrat analysis on income tax equivalent in tab 1; Library research in tab 2).

Rocio Concha, Which? Director of Policy and Advocacy, said:

"While it’s positive that inflation is falling, the cost of living is still increasing and consumers are paying significantly more for essential services and much higher mortgage and rental costs. Which?'s latest data shows that 2.1 million households missed essential bill payments in the month to October 9th due to financial pressures. With Christmas fast approaching, this reality will only become increasingly bleak for those already struggling to make ends meet.

"However, there are still things that essential businesses and the government can do to help consumers. For example, supermarkets should put affordable budget range essentials in expensive convenience stores all over the country. With energy debt rising substantially, the government also urgently needs to set out plans for targeted energy support to support the most vulnerable households this winter.

"Which? is also calling on all telecoms providers to do the right thing and cancel 2024’s above inflation price hikes. Ofcom should use their upcoming review to finally ban these unpredictable mid-contract price hikes and give consumers certainty about the total cost of their contract when they sign up."

Responding to the latest CPI inflation figures which shows headline inflation falling to 4.2% and food inflation falling 2 percentage points to 10.1%, Helen Dickinson, Chief Executive of the British Retail Consortium, said:

“After a brief pause in September, inflation is once again headed in the right direction, helped by the seventh consecutive month of falling food inflation. Clothing & footwear and furniture inflation also eased as retailers competed to offer the best value for customers ahead of the festive season. Prices for rice, butter and yoghurt all fell on the month, as well for adult footwear, while higher commodity prices and the weaker pound fed through into higher inflation rates for chocolate and olive oil. There remains upcoming challenges: oil prices have been slowly climbing, consumer demand is weakening, and higher wage bills are pushing up business costs. Such pressures would be exacerbated by the planned rise in business rates next year.

“Retailers are working hard to keep prices down for hard pressed customers. Unfortunately, these efforts will be tested by a £480m-a-year increase in business rates from Spring 2024. Unless the Chancellor takes action and freezes business rates at the Autumn Budget, we could see added cost pressures filtering through to consumer prices. Higher rates would also damage the viability of many local communities by reducing the incentive to open new shops and increasing the risk of shop closures.”

-ENDS-

Notes:

• ONS Consumer Price Index figures