The cost-of-living gap between the richest and poorest households has reached the highest since records began in 2006, new research suggests.
The Resolution Foundation said the gap in the inflation experienced by the richest and poorest 10th of households grew to 1.5% in April. The think tank said the difference illustrates why low-income families are at the sharp end of the UK’s cost-of-living crisis. Its analysis showed that headline inflation for the poorest 10th of households has now hit 10.2%, compared with the 8.7% rate experienced by the richest 10th of households.
This was said to be because lower-income households spend a greater share of their family budgets on energy bills, which are rising sharply. The Foundation said it believed the best-targeted support for millions of low-and-middle-income households would come through the benefits system.
Jack Leslie, senior economist at the Resolution Foundation, said: “Everyone is feeling the effects of the cost-of-living crisis, which is fuelled by the highest inflation in 40 years. With rapidly rising food prices and soaring energy bills driving the recent inflation surge, low-income families are at the sharp end of this squeeze. The cost of living gap between rich and poor households is at its highest level since comparable records began.
“As the Government prepares a fresh round of cost-of-living support, it is clear where it’s needed most. The Chancellor should prioritise significant targeted support at low-and-middle-income households. Doing so swiftly in the months ahead will be logistically challenging, but it can be done, whether through the benefits system or a heavily reformed Warm Homes Discount scheme.”
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