New Times,
New Thinking.

  1. Chart of the Day
23 March 2022

How inflation is surging ahead of benefits

Prices are set to rise by 7.4 per cent this year but Universal Credit will rise by just 3.1 per cent.

By Ben van der Merwe

Chancellor Rishi Sunak’s Spring Statement featured measures including a cut to fuel duty and a rise in the National Insurance threshold. Notably absent, however, was any plan to match soaring prices with a rise in benefits. 

New figures released today (23 March) by the Office for Budget Responsibility show that inflation is expected to average 7.4 per cent in 2022 and 8 per cent over the coming financial year. Benefits, however, are due for a rise of just 3.1 per cent in April – meaning a real-terms cut for millions of Britons.

Universal Credit, child tax credits and working tax credits are all forecast to be cut by 5.8 per cent in real terms over the next year, while Job Seeker’s Allowance and child tax credits will fall by 5.9 per cent. Carer’s Allowance, meanwhile, will see a real-terms cut of 5.7 per cent.

The government’s planned 3.1 per cent rise in benefits is based on inflation figures from last September, before the war in Ukraine sent oil prices to record highs and threatened to disrupt the global food supply.

In his speech to the House of Commons, Sunak warned that the West’s sanctions against Russia would not be “cost free” and would be reflected in a rising cost of living. For now, however, the government appears content to let Britain’s poorest shoulder that burden.

Select and enter your email address Your weekly guide to the best writing on ideas, politics, books and culture every Saturday. The best way to sign up for The Saturday Read is via The New Statesman's quick and essential guide to the news and politics of the day. The best way to sign up for Morning Call is via
  • Administration / Office
  • Arts and Culture
  • Board Member
  • Business / Corporate Services
  • Client / Customer Services
  • Communications
  • Construction, Works, Engineering
  • Education, Curriculum and Teaching
  • Environment, Conservation and NRM
  • Facility / Grounds Management and Maintenance
  • Finance Management
  • Health - Medical and Nursing Management
  • HR, Training and Organisational Development
  • Information and Communications Technology
  • Information Services, Statistics, Records, Archives
  • Infrastructure Management - Transport, Utilities
  • Legal Officers and Practitioners
  • Librarians and Library Management
  • Management
  • Marketing
  • OH&S, Risk Management
  • Operations Management
  • Planning, Policy, Strategy
  • Printing, Design, Publishing, Web
  • Projects, Programs and Advisors
  • Property, Assets and Fleet Management
  • Public Relations and Media
  • Purchasing and Procurement
  • Quality Management
  • Science and Technical Research and Development
  • Security and Law Enforcement
  • Service Delivery
  • Sport and Recreation
  • Travel, Accommodation, Tourism
  • Wellbeing, Community / Social Services
Visit our privacy Policy for more information about our services, how Progressive Media Investments may use, process and share your personal data, including information on your rights in respect of your personal data and how you can unsubscribe from future marketing communications.

Content from our partners
The power of place in tackling climate change
Tackling the UK's biggest health challenges
"Heat or eat": how to help millions in fuel poverty – with British Gas Energy Trust