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What factors are contributing to the cost of living crisis?
The cost of living crisis in the UK is primarily driven by rising inflation, which reached 2.2% in July 2024. This increase follows a peak of 11.1% in October 2022. The ongoing inflationary pressures have led to higher prices for essential goods and services, pushing many households into financial distress. Additionally, economic inactivity and political decisions, such as the two-child benefit cap, further exacerbate the situation.
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How many people are affected by the rising inflation?
Recent reports indicate that nearly a million more people fell into poverty in the UK during the 2022/23 period. This alarming rise in poverty levels highlights the widespread impact of inflation on everyday lives, with many families struggling to afford basic necessities.
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What measures is the government taking to address this issue?
The Labour government, led by Work and Pensions Secretary Liz Kendall, is focusing on reducing economic inactivity as part of its strategy to combat the cost of living crisis. However, there is criticism regarding the government's approach, with some arguing that it is using the crisis to justify potential tax increases and spending cuts. The upcoming budget in October is expected to address these issues, but specific measures remain to be seen.
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What can individuals do to cope with the rising costs?
Individuals facing the cost of living crisis can take several steps to manage their finances better. This includes budgeting effectively, seeking financial advice, and exploring available government support programs. Additionally, community resources and local charities may offer assistance to those in need, helping to alleviate some of the financial burdens.
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What is the impact of the two-child benefit cap?
The two-child benefit cap has been a contentious issue, with many MPs and campaigners arguing that it keeps hundreds of thousands of children in poverty. The Child Poverty Action Group estimates that lifting this cap could significantly reduce child poverty rates. However, the government has shown hesitance to act on this matter before the upcoming budget, leaving many families in a precarious situation.