Pensions - Articles - Further spike in inflation paints gloomy picture

 Those on fixed incomes will have seen their purchasing power fall by 6.2% over the last 12 months which is particularly worrying for those just getting by.

 “The Chancellor’s Spring Statement has turned into a cost of living ‘not so mini’ Budget, although the longer term financial and economic costs of the pandemic as well as the war in Ukraine pose unprecedented challenges too. This leaves Rishi Sunak with a difficult balancing act when facing calls for temporary or targeted support for those in greatest need.

 “With the cost-of-living squeeze on the rise, individuals will face a further hit to their take-home pay from the planned 1.25% National Insurance increase in just a few weeks. And for state pensioners, the 3.1% increase in April is exactly half current inflation, leaving them one step forward but two steps back, undoubtedly leaving many severely stretched.

 “It’s clear that lower income households and pensioners are disproportionately affected by inflation rates higher than seen for 30 years. That’s why it’s crucial that in future, as planned, inflation data is refined to show the effect on different household categories.”

 
 *CPI Inflation: https://www.ons.gov.uk/economy/inflationandpriceindices/bulletins/consumerpriceinflation/february2022