According to recent research, half of UK households’ discretionary income has decreased in the previous two years.
According to a survey by a left-wing think group, the lowest half of the population’s income has been cut by £110 since 2019. According to the New Economics Foundation (NEF), the richest 5% benefit from an extra £3,300 each year.
Incomes in cities like London have increased six times faster than in the northeast. As a result, the think tank has questioned the government’s levelling up the programme, which attempts to raise living standards and productivity in parts of the UK that have historically been left behind.
According to the NEF study, the poorest half of the population in every region save London and the East of England has had their earnings slashed by an average of £110 per year in the two years after the election, even after accounting for rises in the cost of living. In the northeast of England, the average disposable income has increased by only £20 per year or 0.1 per cent.
On the other hand, incomes in the southeast of England have increased by £550.
Across all areas, single-parent households were the most affected. Incomes in Yorkshire and the Humber, the northwest, and Merseyside fell by around 15 times as much as in London.
Prices are already rising at a rather high rate on a wide range of goods and services as a result of persistent labour shortages, supply chain challenges, and more red tape following Brexit.
The government’s independent forecaster, the Office for Budget Responsibility, predicted at the time of the budget in October that the cost of living might grow at the fastest rate in 30 years. The Chancellor, Rishi Sunak, and the Governor of the Bank of England, Andrew Bailey, have both admitted that household budgets are under pressure. Mr Bailey has even apologised for his role in the incident.