Spring statement as cost of living soars
Rishi Sunak delivered his mini-Budget against a backdrop of rising fuel, energy and food costs. He cut fuel duty by 5p but resisted calls to scrap April's National Insurance rise of 1.25p in the pound; instead the start threshold will rise from £9,600 to £12,570. He warned the UK's post-pandemic recovery has been blown off course by the war in Ukraine, but he promised an income tax cut in 2024 when the economy would be in better shape. The Office for Budget Responsibility painted a bleak picture of the immediate prospects, saying that living standards are set to take the biggest hit since records began in the 1950s. It said inflation was set to peak at 8.7% at the end of this year and this - combined with rising taxes - will ‘weigh heavily on living standards in the coming twelve months’. The UK's tax burden will be the highest level since the 1940s.
Loan sharks and cost of living crisis
Price increases are making it tougher for households to make ends meet, and unlicensed lenders offer loans to the desperate at astronomical interest rates. Last year the Centre for Social Justice (CSJ) researched 3,363 people. One in forty were borrowing from unlicensed lenders. CSJ thinks there are about a million people in England doing this. ‘Overwhelmingly, people borrow when they're desperate. For everyday costs of living, like a gas or electricity bill, or a pram, and then they get exploited by those seeking to extort them for as much money as they can get out of them, offering arbitrary terms, little to no paperwork and an extortionate repayment rate.’ ‘It's just endless,’ one victim said: 'I went from a £150 loan to owing £6,000 in months'. The CSJ report highlights separate data from 1,252 victims, questioned last year by the Illegal Money Lending Team, which prosecutes loan sharks in England. The figures suggest the borrowers are among the poorest in society.
CAP: Government must act
Christians Against Poverty (CAP) is a Christian debt help charity which is calling on the Government to 'act now' and increase support for those on low incomes with everything at its disposal. They saw calls to their debt helpline rise by 47% this January compared to last year, and requests for emergency fuel vouchers have doubled. CAP said, ‘We, along with many other charities and think-tanks, say that the upgrading of Social Security (the amount benefits and pensions go up in April) needs to be more than planned. Also they could pause deductions to Universal Credit as they did at the beginning of the pandemic. The third thing needed is a cost of living review; the level of social security has not matched the actual cost of living, even for the barest of essentials, for many, many years.’
Church leaders call for renewable energy
The former Archbishop of Canterbury, Dr Rowan Williams, and 200+ church leaders sent an open letter to Boris Johnson and Rishi Sunak. They said a stronger commitment to renewable energy would help address the climate emergency and help people to weather the cost of living crisis. Letter signatories include fifty Anglican and Catholic bishops, including the lead environment bishops. Their call for financial and fiscal support for renewable energy and energy efficiency - solar and wind energy - was met in the spring statement, but retrofitting of homes and other buildings across the UK to reduce heating bills and decrease carbon emissions was not. They also proposed a windfall tax on fossil fuel companies to address the cost of living and no support for new oil and gas developments if we are to limit global heating to 1.5°C.
