General Insurance Article - Cost of living crisis deepens as CPI hits new 30 year high

The latest data shows UK inflation (CPI) grew by 7% in the year to March 20221, the sharpest rise in 30 years, driven by increases in fuel prices.

 The change in inflation leaves UK households collectively needing to find an extra £54.4bn2 a year to maintain their standard of living compared to 12 months ago, with each household typically needing to spend an extra £1,957 a year to maintain their standard of living compared to a year ago.

 Andrew Tully, technical director, Canada Life commented: “Today’s numbers only serve to pile on the pressure as the cost of living crisis deepens, with seemingly no light at the end of the tunnel. With price rises on a scale we haven’t experienced for 30 years, and the predicted peak yet to come, the bad news will only get worse. The immediate challenge for many is to cope with rapidly rising prices as best they can, especially as wages are lagging behind.

 “How high inflation will go is only part of the story, the longer it remains above the target of 2% will put more pressure on those struggling to make ends meet and determine our living standards for years to come.

 “This will be felt by all of us but particularly for pensioners whose personal rate of inflation may well be above any headline rate. Though the double lock will boost the state pension by 3.1% this month, the princely rise of £5.55 a week for those receiving the full increase will offer very little in the way of comfort from the day-to-day price rises we are currently experiencing.”

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