What's happened
UK inflation has dropped to 1.7%, affecting benefit increases for millions. Universal Credit and disability benefits will see minimal rises in April 2025, while state pensions will increase by 4.1%. Analysts predict inflation may rise again due to energy costs, complicating financial planning for families.
Why it matters
What the papers say
According to Hilary Osborne in The Guardian, the 1.7% inflation figure means a typical low-income family on Universal Credit will see an annual increase of only £253, which could have been £327 if calculated with October's expected inflation rate of 2.2%. Meanwhile, BBC News highlights that the state pension increase will be governed by the triple lock, resulting in a 4.1% rise, which is significantly higher than the benefit increases. David Hughes from The Independent emphasizes the urgent need for government action to support struggling families, noting that the current benefit increases are insufficient to meet rising living costs. This disparity in benefit increases raises questions about the government's commitment to addressing poverty among working-age individuals.
How we got here
The UK inflation rate, measured by the Consumer Prices Index, has fallen unexpectedly to 1.7% as of September 2024. This figure is crucial for determining benefit increases, particularly for Universal Credit and disability payments, which are linked to inflation rates.
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What Does the Latest Drop in UK Inflation to 1.7% Mean for You?
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More on these topics
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The Bank of England is the central bank of the United Kingdom and the model on which most modern central banks have been based.
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Universal Credit is a United Kingdom social security payment. It is replacing and combining six benefits for working-age people who have a low household income: income-based Employment and Support Allowance, income-based Jobseeker's Allowance, and Income
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Rachel Jane Reeves is a British Labour Party politician serving as Shadow Chancellor of the Duchy of Lancaster and Shadow Minister for the Cabinet Office since 2020. She has been the Member of Parliament for Leeds West since 2010.
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The United Kingdom of Great Britain and Northern Ireland, commonly known as the United Kingdom or Britain, is a sovereign country located off the northwestern coast of the European mainland.
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The Resolution Foundation is an independent British think tank established in 2005. Its stated aim is to improve the standard of living of low- and middle-income families.
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Labor-Gesher was a joint list of the Israeli Israeli Labor Party and Gesher parties for elections for the twenty-second Knesset. The list advocated social democracy and progressive taxation. The list's platform focused primarily on socio-economic issues.