The New Economics Foundation have calculated that the poorest quarter of households will be £210 per week short of an acceptable standard of living by April 2024 in the wake of the Autumn Statement. The NEF warns that the measures announced by the Chancellor today fail to protect those who are struggling the most.
Since April 2022, they say, the gap to an acceptable standard of living will have grown by £40 per week for the poorest quarter of households. This is based on the minimum income standard (MIS), a measure of what people consider to be an acceptable standard of living
It comes after it emerged the richest 20% of households will gain almost half the money spent on Chancellor Jeremy Hunt’s tax cuts, according to the IPPR thinktank. It means people in London and the south-east of England will gain most, the thinktank went on to say.
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“For every £100 Hunt spent on personal tax cuts, £46 will benefit the richest fifth of households. Only £3 of every £100 of tax cuts will go to the worst-off families,” it warned. It said: “London and the south-east of England are the biggest winners with an average annual gain per working age person of £316 and £290 respectively. Those in the north-east, Yorkshire and the Humber, and Wales see the smallest benefit, with average gains of £192, £214, and £211 respectively.”
Commenting on the findings, Henry Parkes, principal economist and head of quantitative research at IPPR, said: “There are many reasons why now is not the time for tax cuts; but even less so when the principal beneficiaries of today’s changes will be the best off households, rather than those worst hit by the continuing cost-of-living crisis. They also disproportionately benefit the richest areas of the country most – the opposite of levelling up.
“More broadly these tax cuts are accompanied by plans to make deep cuts in public services and investment in the future – an approach that commands very little support from the public and will make it harder, not easier, for the UK economy to grow as it needs to.”
