Starmer's Labour promised to boost UK living standards. A year on, not much has changed
Discretionary incomes tumbled 4.2 per cent in April after a wave of bill increases and tax raises, and failed to improve in May – the worst two months for households since the spring of 2022 when Russia's invasion of Ukraine sent energy prices rocketing, according to Retail Economics. In total, they have fallen 7.5 per cent this year to levels seen just after Labour won a landslide victory in July last year, with the least well-off hit hardest.
The bleak findings come as separate analysis shows the number of Britons with second jobs jumping to a record high and one in six workers struggling to pay their monthly bills.
The figures help to explain why political discontent is brewing in Britain – despite Starmer's claim that wages growing faster than prices is a sign of things improving. Labour has been overtaken in opinion polls by Reform UK, which has surged in support as it promises tax cuts and handouts to lower-income Britons.
With pay growth running at around 5 per cent, well above the 3.4 per cent rate of inflation, Starmer and Chancellor of the Exchequer Rachel Reeves said they are delivering on an election promise to make working people better off. But Retail Economics' data covers changes in tax and some bills not captured by official data, suggesting that the real picture for households is much worse.
Disposable incomes recovered strongly from the spring of 2023 after being hit by soaring energy and food bills that pushed inflation to a peak of 11.1 per cent. However, 'awful April' this year delivered a fresh blow as food prices jumped and a raft of regulated costs, from local authority taxes and rail fares to energy and water bills, shot up.
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