RISING LIVING COSTS HITTING POORER HOUSEHOLDS HARDEST
Reports that the rising cost of living has risen faster for poorer households have underlined the need to give greater priority to tackling income inequality.
The National today (Tuesday) reports that ONS figures show that the price of goods purchased by poorer households increased by 3.7 per cent between 2003 and 2013, while the goods purchased by the wealthiest households rose by just 2.3 per cent over the same period.
This means that everyday living costs for poorer households have increased by 45 per cent while costs for wealthier households have risen by less than 32 per cent. This is because poorer households tend to spend more of their income on necessities such as food and clothes where costs have risen faster than on more expensive luxury goods.
A report published last week by the OECD made clear that growing income inequalities have acted as a brake on economic growth. Between 1990 and 2010 economic growth in the UK would have been 9 percentage points higher if levels of income inequality had held steady at 1985 levels instead of growing.
Professor of enterprise policy Mike Danson is quoted as warning that “far from being ‘all in this together’, the living standards of the most vulnerable – the old, sick and disabled, the poor – have been continuously eroded under good times and bad, through growth and recession.”
Commenting, SNP MSP Mark McDonald said:
“These figures show that it is poorer households who are disproportionately paying the price of the rising cost of living.
“The swiftly rising cost of necessities like food and clothing underlines the need to give greater urgency to tackling income inequality.
“We know from OECD research that income inequality has severely undermined economic growth, holding back job creation and investment across the UK.
“The status quo is both failing the poorest households and hindering efforts to grow the economy.
“It is long past time for a different approach and the Westminster Government must start giving greater priority to tackling income inequalities.”