Latest news with #transportcosts
The Independent
4 days ago
- Business
- The Independent
Why has inflation risen unexpectedly and what does it mean for households?
Inflation hit its highest level for nearly a year-and-a-half in June after a surprise increase. Official data showed Consumer Prices Index (CPI) inflation rose to 3.6% in June, up from 3.4% in May and the highest since January 2024. The rise was unexpected, with inflation forecast by most economists to remain at 3.4% last month. Here the PA news agency looks at what is behind the latest increase and what it means for households and the economy: – What is inflation? Inflation is the term used to describe the rising price of goods and services. The inflation rate refers to how quickly prices are going up. June's inflation rate of 3.6% means that if an item cost £100 a year ago, it would now cost £103.60. – What drove the latest increase? Food prices and transport costs were largely behind the latest increase in CPI, according to the Office for National Statistics (ONS). It said annual food price inflation hit the highest level since February 2024 – at 4.5% including non-alcoholic drinks. This marked the third month in a row of rising food price inflation, which is unwelcome news for households. But the ONS said it was still 'well below the peak seen in early 2023', when food price inflation reached an eye-watering 19.2%. Within transport costs, the ONS said air fares soared by 7.9% between May and June, marking the biggest rise for seven years. Rail fares also rose month-on-month, having fallen a year earlier, while fuel prices fell only slightly last month compared with a larger fall a year ago. The average price of petrol fell by 0.5 pence a litre during June, compared with a a drop of 3 pence a litre between May and June 2024. – Where will inflation go from here? Economists expect inflation to continue edging up over the next few months before peaking in September. Lower energy bills are then set to help start bringing inflation back down heading into 2026 thanks to recent falls in Ofgem's price cap. However, Matt Swannell, chief economic adviser to the EY Item Club said stubborn inflation in the services sector would mean 'the fall in inflation is likely to be gradual'. – What does it mean for interest rates? The latest inflation figures are a headache for the Bank of England, given that it brings CPI further away from its 2% target. Policymakers are still widely expected to cut rates again next month, from 4.25% to 4%, given a slowing wider economy, though it is likely to see the Bank move cautiously with any future rises, according to experts. The figures come after gross domestic product (GDP) shrank by 0.1% in May, following a 0.3% fall in April and leading to fears of a contraction overall in the third quarter. Jobs figures on Thursday are expected to show a further slowdown in wage growth, which may also help smooth the path for a rate cut. Bank governor Andrew Bailey said in an interview with The Times newspaper earlier this week that rates could be cut further if the jobs market slows down, saying 'I really do believe the path is downward'. Mr Swannell said there 'doesn't seem to be enough in these inflation numbers to derail an interest rate cut in August'. 'The MPC has lowered Bank Rate at alternate meetings since its rate cutting cycle began last summer, and the committee voiced growing concerns about the weakening state of the labour market at last month's meeting as it held rates, so a 25 basis point rate cut at the August meeting has appeared likely for some time,' he added.
Daily Mail
11-07-2025
- Politics
- Daily Mail
Council spends almost £160,000 a year on ferrying ONE child with special needs to school - as transport costs spiral to more than £1.5bn
A council spent almost £160,000 last year on travel for just a single child with special education needs and disabilities to and from school, new figures have revealed. East Sussex forked out the astonishing sum in 2024 amid a huge spike in the cost of transport to specialist Send schools, which hit £1.5billion for the country last year. Data obtained by the Liberal Democrats using the freedom of information act showed that Milton Keynes Council also spent a six-figure sum - £113,000 - on transport - for one child. It comes as Labour faces demands to get a grip on the spiralling bill - but also pressure from already militant backbenchers who have vowed to fight any cuts. Data released last month showed the number of children with education, health and care (EHC) plans - which allow them to access funding for transport - surged by 10 per cent in the year to January. Just over £1.5billion was earmarked for transporting S pupils aged up to 16 in 2024-25. That was up from £1.2billion the previous year - and around three times the level from 2017-18. Lib Dem leader Sir Ed Davey called for more Send schools to be built as part of a general increase in capacity to cut overall costs, rather than reducing EHCs. 'Parents of children with special educational needs are fighting a broken system that doesn't provide the support they need. If the Government thinks the answer to the crisis is to roll back children's rights, they're totally missing the point,' he said. 'After years of Conservative underfunding and neglect, too many children aren't getting the support they need at school and councils are having to shell out for expensive private provision.' East Sussex Council has been approached to comment. A report by the Local Government Association (LGA) earlier this month predicted the transport cost will rise to £1.97 billion in 2025/26. There has also been a rise in children being placed in schools far from their homes due to local ones being full, the report said. And some children may also have more 'complex' needs, requiring 'individualised' transport. According to separate Government figures, the number of pupils with EHCPs is now 482,640 – the highest figure on record – and double the number in 2016. Many of these children are disabled, or need a specific special needs school, necessitating the state paying for transport. In addition, some children without Send are eligible if they live far away from their nearest school or are on a low income. Ministers have failed to rule out slashing education plans for children and young people with special educational needs, after campaigners warned against the move. Education minister Stephen Morgan insisted parents should have 'absolutely' no fear that support for children with special needs or disabilities will be scaled back. But he could not guarantee that the current system of education, health and care plans (EHCPs), which are issued to give children specialist classroom support, would remain in place. In a letter shared with the Guardian newspaper, campaigners have said that without the documents in mainstream schools, 'many thousands of children risk being denied vital provision, or losing access to education altogether'. On Monday, Mr Morgan told broadcaster LBC the current system of support is 'failing children, it's failing parents'. Asked if concerned campaigners could have no fear that Send support will be scaled back, Mr Morgan replied: 'Absolutely. What we want to do is make sure we've got a better system in place as a result of the reform that we're doing that improves outcomes for children with additional needs.' But pressed whether the reforms could include scrapping ECHPs, Mr Morgan replied: 'We're looking at all things in the round.
