Londoners are worst affected by “soaring” inflation, according to new research

The Mayor of London, Sadiq Khan, has warned that low paid Londoners are being hit harder by the cost of living crisis than other parts of the UK, as new City Hall research suggests that London is experiencing faster underlying inflation in some areas.

The UK’s rate of inflation jumped to 10.1 per cent in July, the first time it has registered a double-digit annual increase in more than four decades, and Bank of England projections point to inflation accelerating further later this year.

However, over the last six months, underlying inflation for local prices in London has consistently been found to track 1.5 percentage points higher than the national figure.

Rising local food costs is one of the key pressures pushing the capital’s underlying inflation above the national average. This will affect Londoners on the lowest incomes the hardest as they spend a larger proportion of their income on food.

London rental prices are also said to be a “major factor”: the Rightmove Rental Price Tracker indicates asking rents for new rentals in London are growing faster than anywhere else in the UK, up as much as 15.8 per cent annually in the last three months.

This inflationary pressure is only set to grow as more people renew or move out of contracts that may have been kept at a lower price for longer due to the pandemic. Sadiq has suggested a range of measures the Government should implement now to ease the cost of living crisis for Londoners. These include:

• The introduction of an energy ‘Lifeline Tariff’ for the most vulnerable Londoners, providing the minimum energy needed for a household to function for free, with any charges kicking in only once a minimum use threshold had been met.
• Introducing a two-year rent freeze for London’s 2.4m private renters, which would act as a first step towards devolving full rent control powers to cool London’s overheated private rental sector.
• Extending the provision of healthy free school meals to all primary school children during term-time with free meal vouchers available for those in most need during the school holidays.
• Restoring the £20 Universal Credit uplift, which Ministers removed in September last year, pushing 130,000 more Londoners into poverty.

The Mayor of London, Sadiq Khan commented: “This new report shows in black and white that millions of low paid Londoners are living on the front line of the cost of living crisis.

“I’m doing all I can to support Londoners, but we need the Government to step up. This must include doing more on energy bills to ensure no one has to make the choice this winter of heating their home or eating, increasing benefits in line with inflation, and giving me the power to implement rent controls in London.

“Whoever becomes the next Prime Minister must make tackling the cost of living for Londoners, and people across the country, their top priority.”

By Matthew Neville – Correspondent, Bdaily

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