It was the year of the Falklands War, when Bucks Fizz were topping the charts and Del Boy and Rodney's wheeler-dealer antics kept Britons glued to the
It was the year of the Falklands War, when Bucks Fizz were topping the charts and Del Boy and Rodney’s wheeler-dealer antics kept Britons glued to their televisions.
But 1982 was also the year that inflation was at 9.1 per cent, a level that would remain unmatched until today’s headline figure of 9 per cent.
The Bank of England even expects that the rate will climb further to a peak of 10.25 per cent in the final quarter of this year, sparking the biggest squeeze in incomes in decades.
Britain’s Prime Minister in the 1980s, Margaret Thatcher, had swept into office in 1979 just after the industrial unrest of the ‘Winter of Discontent’, which had been marked by widespread strikes and rampant pay demands from greedy trade union bosses.
The high levels of inflation during Mrs Thatcher’s early years in office were a by-product of the economic chaos of the 1970s.
In 1975, inflation had peaked at more than 25 per cent, causing the prices of ordinary goods to rise rapidly.
Mrs Thatcher was elected on a mandate that included a promise to tame inflation. That 9.1 per cent figure of 1982 – which came in March – was in fact far lower than the spring 1980 level. Then, it reached the equivalent by today’s standards of nearly 18 per cent.
Unemployment in 1982 rose above three million for the first time since 1930s, meaning one in eight people were out of work. Shoppers were also suffering after a decade of rising food prices, with a basket of goods going from £9.40 in 1972 to £35 ten years later.
Mrs Thatcher’s method of getting inflation under control – hiking interest rates to an excruciating 17 per cent – was successful, with levels plummeting to below five per cent in the mid-1980s, but it came at the cost of pushing unemployment even further to beyond 4 million.
The PM’s government, which included the tough-talking Employment Secretary Norman Tebbit and Chancellor Geoffrey Howe, also introduced curbs on public spending which, although effective in further pushing down inflation, also caused further social unrest.
In 1982, there were mass strikes by NHS workers who were demanding a pay rise, whilst sympathetic miners in Wales also downed tools.
In 1982, unemployment rose above three million for the first time since the 1930s as Margaret Thatcher’s economic policies – imposed to try to curb inflation – started to bite. Above: Unemployed construction workers march in central London in 1982
Unemployed people are seen queuing for the dole in Woolwich, east London, in 1982. The unemployment rate that year reached beyond 3million and eventually climbed to more than 4million later in the 1980s
The last time the level of inflation went beyond nine per cent, in March 1982, Margaret Thatcher was in her fourth year as Prime Minister. Above: The then PM giving a speech in 1982
In February 1982, the Daily Mail reported how shoppers were changing their habits and going for cheaper foods in the face of rising prices. It noted how rising prices had ‘particularly hit the meat trade’
A news report later in 1982 reported on the ‘costly years’ and noted how inflation since the 1970s had hit families hard
Only Fools And Horses were popular on British TV, along with other shows such as This Is Your Life and Coronation Street. Above: Nicholas Lyndhurst as Rodney, David Jason (centre) as Del Boy and Lennard Pearce as Grandad
The legacy of the high inflation of the early 1980s stretched as far back as a decade previously, when surging oil prices, an international energy crisis and strikes and wage demands by unions had caused economic turmoil.
The social historian Dominic Sandbrook has documented how the unrest of the 1970s peaked with the 1979 Winter of Discontent, when bin bags heaped high in London’s Leicester Square after refuse workers went on strike.
In October 1973, the OPEC cartel – which was dominated by Arab producers – raised the price of oil by 17 per cent in retaliation for the West’s support of Israel in the Yom Kippur War.
The move prompted inflation to tear through the economy and led to the the Prime Minister Edward Heath declaring a three-day week, as strikes by coal miners led to a drastic shortage of energy.
When Heath was turfed out of office after calling an election in which he asked ‘Who governs Britain?’, his Labour successor Harold Wilson was then faced with an even worse situation..
By the spring of 1975, prices in the UK were rising five times faster than in Europe.
Sandbrook highlights how, in just a year, the price of sugar went up by 184 per cent, carrots by 137 per cent and electricity by 66 per cent.
But, terrified of further crippling strikes that had already brought the country to a halt, ministers were still agreeing to huge pay increases for workers, a factor that contributed further to inflation.
The Daily Mail reported in January 1982 how unemployment had topped three million, with Mrs Thatcher receiving a ‘barrage of abuse’
NHS nurses are seen on strike to demand a pay rise of 12 per cent in September 1982. They were joined by other health workers
Mrs Thatcher’s popularity levels – which had been dangerously low – were boosted by Britain’s victory over Argentina in the Falklands War
Mrs Thatcher was elected on a mandate that included a promise to tame inflation. The PM’s government included the tough-talking Employment Secretary Norman Tebbit and Chancellor Geoffrey Howe
Whilst Wilson and his successor Callaghan brought inflation down to single figures in 1978 by persuading the unions to accept reduced pay deals, the situation worsened once again late that year, when lorry drivers went on strike to demand higher wages.
The Winter of Discontent saw ports, petrol stations and supermarkets paralysed as supply chains ground to a halt.
With Callaghan hamstrung by an apparent inability to get the situation under control, Mrs Thatcher won the 1979 election on the back of a programme that promised to fix the situation.
Mrs Thatcher’s economic programme also included a shift from centralised, state-controlled institutions to privatisation and economic reform.
Big British names that were privatised included British Telecom and airline British Airways.
But her policies led to brutal divisions in the country, as they boosted the service sector and home ownership but led to the decline of manufacturing and industries such as coal mining and steel making.
In 1982, the year of the 9.1 per cent inflation figure, NHS staff went on strike over pay in September. With nurses campaigning for a 12 per cent pay rise, the three-day strike shook the health service
Rail workers also went on strike in 1982. Above: Workers on a picket line outside east London’s Stratford freight terminal
The social historian Dominic Sandbrook has documented how the unrest of the 1970s peaked with the 1979 Winter of Discontent, when bin bags heaped high in London’s Leicester Square after refuse workers went on strike
Margaret Thatcher insisted on the tough economic policies in an attempt to curb inflation. Above: The then PM on a visit to China in 1982
The introduction of high interest rates and tough public spending curbs ultimately led to a recession and the rise in unemployment that the 1980s are famous for.
The Government hoped to reduce the amount of money in circulation by simultaneously cutting spending and raising indirect taxes.
Inflation did start to come down, but not before the UK economy spent the whole of 1980 and early 1981 in recession.
In 1982, the unemployment rate stood at 10.4 per cent, the highest for 50 years, compared with 3.7 per cent today.
The basic rate of income tax was 30 per cent, 10 percentage points higher than where it is now, while the standard rate of VAT was 15%, five points lower than the current rate.
The unemployment hit hardest in Northern Ireland, where one in five people were out of work in the early 1980s.
However, the industrial areas of northern England and Scotland also suffered.
In 1982, the year of the 9.1 per cent inflation figure, NHS staff went on strike over pay in September. With nurses campaigning for a 12 per cent pay rise, the three-day strike shook the health service.
Three months earlier, Welsh miners in South Wales downed tools in support of health service workers. In total, around 24,000 miners stopped working, with thousands marching through Cardiff.
But Mrs Thatcher’s popularity levels – which had been dangerously low – had by then been boosted by Britain’s victory over Argentina in the Falklands War.
The nation was also buoyed by the birth of Prince William, with Princess Diana and Prince Charles pictured beaming outside St Mary’s Hospital in London.
Mrs Thatcher’s brutal battle with Arthur Scargill, the leader of the National Union of Mineworkers, came in 1984, after ministers forced through proposals to close 20 uneconomic pits, putting 20,000 miners out of work.
Within a week of the first miners going on strike, in March, more than half of the country’s miners had downed tools.
But the Conservative government held out and even though the dispute lasted more than a year, the miners eventually returned to work and the pit closure programme continued.
The popular quiz show made its debut in 1982, after Channel 4 had been launched. Above: Carol Voerderman (top right) with Kenneth Williams and Richard Whiteley
Musicians Paul Weller (left) and Bruce Foxton, of the group The Jam, perform onstage, Chicago, Illinois, May 26, 1982. The Jam made it to the top of the UK singles chart with their hits Town Called Malice and Precious
Ozzy Osborne infamously bit the head off a bat after it was thrown on stage and he believed it was a rubber version rather than an actual creature
Only Fools And Horses stars David Jason, Lennard Pearce and Nicholas Lyndhurst are seen in a scene from series 2 of the hit show
The IRA also carried out bomb attacks in 1982, with the most infamous being the blasts in Hyde Park and Regents Park that left eight soldiers and several horses dead
In 1982, Bucks Fizz topped the charts twice with their singles The Land of Make Believe and My Camera Never Lies. Above: The band performing that year
On a cultural level, 1982 will be remembered for the popularity of pop group Bucks Fizz and the now-legendary television show Only Fools And Horses.
Bucks Fizz topped the charts twice with their singles The Land of Make Believe and My Camera Never Lies, whilst the likes of The Human League’s Don’t You Want Me were also popular.
All large shops were closed on Sundays by law, and many closed for a half a day on Wednesdays.
British Telecom was still then publicly owned, meaning the entire telephone system was run by the state.
The UK’s gas, electricity, coal and water industries were all in public hands, along with the Royal Mail, British Rail, British Airways, British Steel, BP, Rolls-Royce and British Leyland (later known as the Rover Group).
The population had only four UK-wide radio stations to enjoy – Radios 1, 2, 3 and 4 – and just three television channels to choose between, BBC1, BBC2 and ITV, though Channel 4 would launch later that year in November.
Breakfast television had yet to begin, so BBC1 and ITV did not typically start broadcasting on a weekday until lunchtime, while BBC2 filled most of its daytime schedule with programmes for the Open University.
Around 14 million households watched television on colour sets, while four million still watched in black and white.
As well as Only Fools And Horses, the most popular TV programmes in March were This Is Your Life and Coronation Street – both on ITV and both of which attracted audiences of around 17 million.
Even after Mrs Thatcher’s radical changes to the economy, inflation had still climbed back to 8 per cent by the time of her final year in office in 1990.
The most infamous example of rampant inflation, in Weimar Germany in the 1920s, far outstrips the levels seen in the UK today.
The cost of war debts and reparations paid to Allied forces including Britain had caused the economy to collapse. Whilst a loaf of bread had cost 160marks in 1922, it cost 200,000,000,000 marks a year later.
And whilst ten years earlier you needed 12 marks to buy a pair of shoes, by November 1923 the average German needed 32,000,000,000,000 marks.
The inflation led to the savings of ordinary Germans being wiped out overnight.
‘The warning lights are flashing red’: Britain teeters on the brink of recession after inflation soars to 40-YEAR high with ‘apocalyptic’ food costs looming – as Rishi says he WILL cut taxes in Autumn Budget… but for businesses
- The headline CPI rate of inflation was 9 per cent in April with soaring utility bills causing most of the increase
- Inflation is now at the highest level since March 1982 when Margaret Thatcher was on verge of Falklands War
- Rishi Sunak is under massive pressure to bring forward new help for families struggling to make ends meet
By James Tapsfield, Political Editor for MailOnline
Rishi Sunak is promising tax cuts today after inflation soared to an eye-watering 40-year high with fears things are set to get even worse – but he will make clear they are being targeted at business.
The Chancellor will give a hint at his plans for the Autumn Budget in a speech to the CBI this evening, hours after it emerged the headline CPI rate rose to 9 per cent in April.
That was up from 7 per cent in March and a peak since 1982, when Margaret Thatcher was PM, the Falklands War was about to start, and unemployment was running at three million.
The Bank of England expects the annual rate will get even worse, peaking at 10.25 per cent during the final quarter of the year amid the biggest squeeze on incomes since records began in the 1950s. That would be more than five times its 2 per cent target.
Experts said ‘this is what Stagflation looks like’, while ministers were urged to recognise that the ‘warning lights are flashing red’ with the UK economy teetering towards recession after the pandemic and Ukraine war.
Analysts said another interest rate hike next month is now ‘inevitable’, potentially to 1.25 per cent, as the Bank of England scrambles to stop prices spiralling out of control. But the Pound still dipped further against the US dollar as investors priced in the increasingly grim situation.
In his speech to business leaders this evening, Mr Sunak is expected to say that cutting costs for families is ‘our role in government’.
But he will apparently not announce any more direct help, instead telling bosses: ‘We need you to invest more, train more, and innovate more.
‘In the autumn Budget we will cut your taxes to encourage you to do all those things. That is the path to higher productivity, higher living standards, and a more prosperous and secure future.’
At PMQs this afternoon, Mr Johnson blustered as he was grilled by Keir Starmer over whether he will bring in a levy on profits of oil and gas firms – amid signs of splits in the Cabinet on the idea.
Instead he said ‘this Government is not in principle in favour of higher taxation’ and the government would ‘look at all the measures that we need to take to get people through to the other side’.
Mr Johnson highlighted the huge UK investments being made by such companies, and argued they were already highly taxed. But No10 effectively issued a threat by saying the government wanted them to pump more money into infrastructure.
Opposition parties are urging an emergency Budget to slash VAT and help struggling Britons who are ‘on the brink’.
But there are mounting signs of splits in Cabinet over how to respond, with Foreign Secretary Liz Truss suggesting more tax cuts are needed and slating the idea of a windfall tax on energy firms – something Mr Sunak has said he is seriously considering.
Threadneedle Street governor Andrew Bailey infuriated ministers earlier this week when he delivered an extraordinary warning that ‘apocalyptic’ food price rises are in the pipeline.
He admitted that the Bank is largely ‘helpless’ to prevent the ‘very real income shock’ and unemployment will rise.
The unrelentingly miserable news continued with pump prices reaching new records, of 167.64p for petrol and 180.88p for diesel.
In a further headache for ministers, the RPI measure of inflation has rocketed even higher to 11.1 per cent in April – with unions threatening strikes unless that is used as the basis for pay rises in the public sector.
As Britons are buffeted by the fallout from Ukraine and the pandemic hangover:
- Unite chief Sharon Graham threatened strike action against employers who do not give pay rises in line with inflation, saying calls for wage restraint should be directed at FTSE 100 chief executives;
- The average cost of a litre of petrol at UK forecourts on Tuesday was 167.6p, higher than the previous record of 167.3p set on March 22 – the day before Mr Sunak announced a 5p cut in fuel duty. Diesel prices have risen to 180.9p;
- Tories have warned the Bank of England not to overreact now by pushing up interest rates too quickly, dooming the country to recession;
- The average UK house price jumped by £24,000 in the year to March, according to official figures.
Boris Johnson was flanked by Rishi Sunak at PMQs today as he clashed with political opponents over the cost-of-living crisis
Newly-modelled figures from the ONS show that CPI would have last been above the April 2022 level of 9 per cent in March 1982 – when it was 9.1 per cent
Mr Johnson frantically dodged at PMQs this afternoon as he was grilled by Keir Starmer (pictured) over whether he will bring in a windfall tax on energy firms’ profits – amid signs of splits in the Cabinet on the idea
Sharp increases in snergy and other household bills have been driving the recent spike in inflation
The Bank of England has predicted that inflation will keep rising and hit 10.25 per cent by the end of the year – before falling back again
At a bruising PMQs, Sir Keir urged Mr Johnson to stop the ‘hokey-cokey’ and do an ‘inevitable U-turn’ on the windfall tax.
The Labour leader said: ‘Last week, he said ‘we will have a look at it’. Yesterday, he voted against it. Anyone picking up the papers today would think they are for it. And now he says he is against it again. Clear as mud.
‘To be fair, it’s not like the rest of his Cabinet know what they think either. The same day the Chancellor said it was something he was looking at, the Justice Secretary said it would be disastrous.
‘The Business Secretary called it a bad idea. But also said he would consider a Spanish-style windfall tax. One minute they’re ruling it in. The next, they are ruling it out. When will he stop the hokey-cokey and just back Labour’s plan for a windfall tax to cut household bills?’
Mr Johnson replied: ‘This country and the world faces problems in the cost of energy driven partly by Covid and partly by (Vladimir) Putin’s war of choice in Ukraine. And we know, we always knew that there will be a a short-term cost in weaning ourselves off Putin’s hydrocarbons, and in sanctioning the Russian economy.
‘Everybody in this House voted for those sanctions. We knew that it would be tough, but I just want to tell the right honourable gentleman that giving in, not sticking the course would ultimately be that far greater economic risk.’
He added: ‘We will look at measures, we will look at all the measures that we need to take, to get people through to the other side but the only reason we can do that is because we took the tough decisions that were necessary during the pandemic, which would not have been possible if we listened to him.’
Mr Johnson accused Sir Keir of having a ‘lust to raise taxes’.
On the windfall tax he said: ‘We don’t relish it, we don’t want to do it, of course we don’t want to do it, we believe in jobs and we believe in investment and we believe in growth.
‘As it happens, the oil companies concerned are on track to invest about £70billion into our economy over the next few years, they’re already taxed at a rate of 40 per cent.’
Mr Johnson added: ‘Of course we will look at all sensible measures but we will be driven by considerations of growth, investment and employment.’
After the exchanges, Downing Street urged oil and gas companies to ‘go further’ in investing profits amid growing calls for the Government to impose a windfall tax.
The PM’s official spokesman said: ‘We do want them to go further, recognising they’ve already put billions of pounds into renewable energy, but as yet we have not set a timeline.’
However, Foreign Secretary Liz Truss took a much more negative stance on a levy in a round of interviews this morning.
She cautioned that the move would make it ‘difficult to attract future investment into our country’.
Mr Sunak said in a statement after the figures this morning: ‘Today’s inflation numbers are driven by the energy price cap rise in April, which in turn is driven by higher global energy prices.
‘We cannot protect people completely from these global challenges but are providing significant support where we can, and stand ready to take further action.
‘We’re saving the average worker £330 a year through reducing National Insurance Contributions, changing Universal Credit to save over a million families around £1,000 a year, and providing millions of families with £350 each this year to help with their energy bills.’
ONS Chief Economist Grant Fitzner said: ‘Inflation rose steeply in April, driven by the sharp climb in electricity and gas prices as the higher price cap came into effect. Around three-quarters of the increase in the annual rate this month came from utility bills.
‘We have also published new modelled historical estimates today which show that CPI annual inflation was last higher forty years ago.
‘Steep annual rises in the cost of metals, chemicals and crude oil also continued, along with higher prices for goods leaving factory gates. This was driven by increases for food products, transport equipment and metals, machinery and equipment.’
However, Ms Truss suggested that the government had to do more to create a ‘low tax economy’, dodging whether she had backed the national insurance hike.
‘I know he’s looking at this very, very urgently,’ Ms Truss said.
‘He’s already offered additional support
‘The key response to the huge global inflation crisis we are facing is to make sure our economy grows.
‘That is what is going to help people, it’s going to help people in work… to do that we need to attract business investment.
‘We have been successful at attracting business investment so far, we need to do more.
‘What we know is that a low tax economy helps to deliver that business investment, helps to deliver those jobs.
‘I know the Chancellor is looking at all of those things.’
She told ITV’s Good Morning Britain: ‘We’ve got the lowest unemployment since 1974. That’s a positive thing. But now we need to get the economic growth up.
‘We need to attract investment, and this is why having a low tax economy is so important. We’re competing for investment with other countries.’
The British Chambers of Commerce said the ‘unprecedented’ impact of rising inflation meant a ‘real chance’ of a recession later this year.
BCC head of economics Suren Thiru called for Rishi Sunak to reverse the rise in National Insurance Contributions and cut VAT on business energy bills to 5 per cent.
He said: ‘The jump in UK inflation in April is eye-watering and underscores the growing cost-of-living crisis facing households and the damaging squeeze on firms’ ability to invest and operate at full capacity.
‘The marked acceleration in the headline rate in April reflected the continued upward pressure on prices from surging energy and commodity costs, as well as the energy price cap rise and the reversal of the VAT reduction for hospitality in the month.
‘The scale at which inflation is damaging key drivers of UK output, including consumer spending and business investment, is unprecedented and means there is a real chance the UK will be in recession by the third quarter of the year.’
Another interest rate rise in June was ‘inevitable’ but that would do little to address global factors driving inflation up, he said.
The respected Institute for Fiscal Studies economic think-tank suggested the inflation rate experienced by the poorest household could be closer to 11 per cent.
‘As poorest households spend more of their total budget on gas and electricity, we now see inflation hitting the poorest households harder,’according to analysis by the think tank’s Heidi Karjalainen and Peter Levell said.
‘In April, the bottom 10 per cent of the population in terms of income faced a rate of inflation rate of 10.9 per cent, which was three percentage points higher than the inflation rate of the richest 10 per cent.
‘Most of this difference comes from the fact that the poorest households spend 11 per cent of their total household budget on gas and electricity, compared to 4 per cent for the richest households.’
The Resolution Foundation (RF), which focuses on living standards, estimated that the poorest households faced a rate of 10.2 per cent.
The difference is largely due to soaring energy bills, with the price cap increasing by £693 for the typical family in April.
For the poorest households, energy costs make up a greater proportion of expenditure than for wealthier counterparts.
The IFS said the poorest households spend 11 per cent of their total household budget on gas and electricity, compared to 4 per for the richest households.
The rising cost of food is also a factor, with prices rising by 6.7 per cent, their highest rate since 2011.
The Joseph Rowntree Foundation said parents are skipping meals to ensure their children can eat and others are cutting back on showers to save water.
Rebecca McDonald, the foundation’s senior economist, said: ‘Inflation has hit a 40-year high. Yet last month, with prices already climbing, the Chancellor chose not to uprate benefits in line with inflation, leaving the basic rate of benefits at its lowest for 35 years.’
Trade Secretary Anne-Marie Trevelyan warned there are likely to be a ‘couple of bumps to get through’ before inflation settles down.
Ms Trevelyan told an event at Bloomberg’s headquarters in London: ‘This is something we have to tackle across the board.
‘And the worry we always have is that inflation tends to have two bumps to it.
‘You have the initial one that is caused by this energy spike and immediate global rise but what can follow is the longer term impact and indeed through food production and particularly with disruption to Ukraine.
‘So we know that we will probably have a couple of bumps to get through before we will see, we hope, stabilisation and a reduction as the energy crisis settles.’
Energy prices drove most of the record rises in inflation seen last month, but costs in supermarkets, restaurants and pubs also added to the pressure felt by households.
The Office for National Statistics said most of the rise was due to the 54 per cent hike in the energy price cap, but price on all but two of the more than 80 items that the ONS tracks have risen over the past year.
According to Retail Price Index figures – which are slightly different to the CPI – the price of unprocessed potatoes dropped 1.2 per cent in the year to April, while audio-visual equipment became 3 per cent less expensive.
For everything else prices went up. Overall food prices rose 6.8 per cent, the figures show, with meats, oils and some animal products especially hit.
The rise across meat categories was clear: lamb was the worst hit, up 14.2 per cent, followed by poultry (10.4 per cent) and beef (9.8 per cent) while pork got off with a lighter 4.9 per cent rise.
Butter prices rose 11.8 per cent and the price of oils and other fats soared 18.2 per cent over the last year after fears of a shortage sparked by the war in Ukraine.
The price of fresh milk also rose rapidly, up 13.2 per cent, while sugar and preserves rose 12.2 per cent.
Away from food, households were also hit by an 8.1 per cnt extra price on their restaurant bills, while the price of takeaways and snacks rose 6.5 per cent.
Drinking at a pub got more expensive too, with the cost of beer up 4.9 per cent and wine rising 6.2 per cent. Alcohol prices increased less rapidly in off licences and supermarkets.
Food and Drink Federation chief executive Karen Betts said that the figures are slightly worse than food manufacturers had feared.
‘This is a very worrying time for many households, and food and drink businesses are continuing to do everything they can to contain food-price inflation,’ she said.
‘Ingredient price rises have been relentless for more than a year now, as a result of pressures in the global supply chain caused by the Covid-19 pandemic.
‘The war in Ukraine, with both Ukraine and Russia important suppliers of commodities like wheat and food oils, as well as energy and fertiliser, has made the situation worse.’
Energy prices are also feeding into the rising food costs – farmers and food factories need gas, petrol and electricity to run their businesses and have to pass these costs onto customers.
Fears are mounting of an inflation spiral after figures yesterday showed wages spiking and unemployment dropping to a five-decade low.
Pay including bonuses jumped 7 per cent and was up 9.9 per cent in March as firms ramped up rewards to keep staff amid a booming jobs market.
However, regular pay was only up by 4.2 per cent – meaning a 1.2 per cent fall when inflation was taken into account.
There is also a big divide in different sectors, with finance and business services workers seeing a 10.7 per cent increase in their packets and employees in retailing, hotels and restaurants 8.5 per cent.
In contrast public sector staff had a 1.6 per cent rise – although they did fare better than the private sector during the pandemic.
The pressure on the labour market was also laid bare with the UK’s jobless rate tumbling to 3.7 per cent in the quarter to March – the lowest since 1974.
For the first time ever, there were fewer unemployed people than job vacancies.
Shadow chancellor Rachel Reeves said: ‘Today’s inflation data will add to the worries families already face as prices soar and pay packets are crunched.
‘It makes it even more unconscionable that – while they pile taxes on working people in the midst of this crisis – the Conservatives voted last night against a windfall tax on oil and gas producer profits to cut families’ energy bills.
‘Our country faces a cost of living crisis, and a growth crisis. Neither are inevitable but a consequence of government policies and Conservative choices.
‘We need an Emergency Budget now from the government to tackle the cost of living crisis, and we need a real plan for growth so we have a fairer and more prosperous economy.’
The Bank of England’s latest projections for GDP and inflation made miserable reading
Inflation and interest rates both spiked in the 1970s – but Professor David Blanchflower said the UK faced a different situation today
Rishi Sunak ‘mulls bring 1p income tax cut forward to THIS this year’ amid cost-of-living crisis
Conservative MPs are urging the Chancellor to take action as quickly as possible to help households struggling with rising prices.
The Office for National statistics recorded inflation at 7 per cent in March and today announced a figure of 9 per cent for April, while the Bank of England has said inflation is likely to peak at 10.25 per cent during the final quarter of 2022.
Rishi Sunak and his Treasury ministers have suggested new measures to help ease cost-of-living pressures are being developed but will not be introduced imminently, i news reports.
The warm home discount will give three million of England and Wales’ poorest homes £150 off their bills from October.
But Treasury officials have also drawn up plans for a one-off increase of £300, £500 or possibly £600 to battle rising energy prices, The Times reports.
The extra measures could cost more than £1 billion and would be directly funded by the government, instead of being levied on energy bills as under the current system.
Sunak is reportedly drawn to this approach partly because there is a lower risk of it becoming permanent.
Also, the basic rate of income tax cut from 20p to 19p is set to take effect in April 2024, but Treasury sources said Mr Sunak is thinking about bringing it forward by one year, announcing it at the Budget in the autumn.
Officials are now said to be looking into deficit projections from the Office for Budget Responsibility to figure out if the change would be affordable.