The UK’s inflation rate dropped sharply last month to its lowest level in two years.
The Office for National Statistics confirmed this morning that consumer prices in the year to October were 4.6 per cent higher than the year before, but this was much lower than the 6.7 per cent recorded in the previous month.
The decline means that Prime Minister Rishi Sunak’s pledge to halve inflation within 12 months has been met and ahead of target.
Mr Sunak made the pledge shortly after becoming prime minister when inflation was more than 10 per cent, along with four other pledges: grow the economy; make sure Britain’s national debt is falling, cut NHS waiting lists and stop the boats.
The Prime Minister will no doubt seize the news that he has met this first pledge and claim that it has been met thanks to the tough decisions taken by the Government.
Indeed, speaking after the announcement, Chancellor Jeremy Hunt said the government had “delivered” it’s “number one pledge” to halve inflation.
“People said it would be easy… that wasn’t the case. We took some very difficult decisions to control borrowing and debt and we’ve now delivered the pledge a month early.”
The Chancellor acknowledged that there was “still work to do” to bring inflation down to two per cent target and said the government can now move to focusing on “the long-term growth of the economy.” He says that’s why “next week will be an Autumn Statement for growth.”
The PM will hope that his restless MPs will also welcome this news and that it will help the Party move on from a furious row between himself and the former Home Secretary, Suella Braverman, who he sacked earlier this week.
However, Mrs Braverman’s resignation letter, and a decision on whether the Government’s Rwanda scheme is legal is dominating the news agenda and is over-shadowing this rare positive news for Mr Sunak.
Critics from within his Party have also pointed out that the decline in the inflation rate has more to do with the Bank of England’s decision to hike interest rates and at the same time a drop in global commodity prices.
Indeed, one Conservative MP told parliamentnews.co.uk that the PM has consistently blamed inflation on the steep rise in domestic energy bills following Russia’s invasion of Ukraine, but now seeks to take credit for a global reduction in prices – “who is he trying to kid” they said. The MP added that the other four pledges still looked unobtainable and could become worse if the Supreme Court rules that “Rwanda is illegal”.
Echoing this view Rachel Reeves MP, Labour’s Shadow Chancellor responded saying: “The fall in inflation will come as some relief for families struggling with the cost of living. But now is not the time for Conservative ministers to be popping champagne corks and patting themselves on the back.”
She added: “After thirteen years of economic failure under the Conservatives, working people are worse off with higher mortgage bills, prices still rising in the shops and inflation twice as high as the Bank of England’s target.
“Rishi Sunak is too out of touch and his party is too divided to help people who are worried about the cost of living. A Labour government’s priority would be making working people better off by boosting wages, cutting people’s bills and getting the economy growing again.”
Rishi Sunak gets major boost as inflation target is met, but this good news is being over-shadowed, writes Alistair Thompson
