In 2024, the UK is facing a general election that has been awaited since Boris Johnson left Downing Street just last year. Since then, the country has lurched from crisis to crisis, with the Conservative Party losing much of its support. To put in perspective what the next candidates are facing, the Bank of England has declared that Britons need to accept that they will become poorer.
From Brexit to the NHS collapsing, there are many factors and consequences that have been a factor in the cost-of-living crisis in the UK. Being one of the world’s largest economies, the UK was the only country on that list not to achieve any economic growth in 2022. According to London Funders, it is estimated that 1.3 million Britons will fall into absolute poverty this year.
Economists have been predicting what is next for the economy, but outcomes are largely dependent on decisions made by the government. However, there is a rising political apathy in many Britons due to continuous political scandals and a lack of any measures taken by the government to ease the cost-of-living crisis.
Even before the pandemic started, an economic crisis in the UK was on the horizon. The pound had lost some of its previous strength due to Brexit and the uncertain general election of 2019. A decade of fiscal austerity under the Conservative government, which cut funding for public services had also damaged the economic prospects of many ordinary Britons.
When COVID hit, all these factors hanging over the UK fell into Parliament and became one of the biggest crises of the current era. Now, the UK is still experiencing the highest rate of inflation since 1981, with an annual rate of 11.1%. In London a clear example can be found of how hard the crisis is hitting, as rents are almost impossible to afford, salaries are falling, and food prices are rising. Londoners have the least amount of disposable income of anywhere in the UK - only £2,016.00 a year. Whereas in Brighton, the next lowest on the list, the figure is nearly three times higher at £5,436.00.
Numbers show the reality in London.
Mayor Sadiq Khan has admitted in a press release that the millions of Londoners with a low-paid job are on the front lines of the cost-of-living crisis. He has warned that the next prime minister needs to make it a priority to tackle the crisis. In concrete terms many Londers will struggle to meet a rise in housing, food, taxes, and bills.
From a national perspective, the average working-age household's income will fall by 4% between 2022 and 2023, according to the Resolution Foundation. This means that the average salary is falling and Britons will be earning less money at a time when salaries need to be raised to meet inflation levels.
One of the most impacted sectors has been rental, with the additional costs falling on the shoulders of tenants. According to a study by the property website Rightmove, the average rent for Londoners is now £2,500 per month, setting a new record. Taking the example of a person under 23 being paid the minimum wage of £10.42, if they work an 8-hour shift five times a week, they will only make £1806.13 a month before taxes.
The Rightmove price tracker has shown that rentals in London are growing every month and becoming harder to afford for locals. This has pushed a new wave of rough sleepers onto the streets of London. The Combined Homelessness and Information Network has determined that for the first quarter of 2023, 3,107 people were sleeping on the streets in total.
With the rental market becoming more competitive, London has become increasingly gentrified, with Londoners that previously lived in Zone 1 having to move to Zones 2 to 4. Landlords have taken control of their prices, and most have asked for a 6-month advance payment with a 2-year contract. Demands that the average worker can’t meet.
Director of Homeless Link Fiona Colley has stated, "Rising costs have not just exacerbated long-term systemic causes of homelessness, such as a shortage of affordable housing and an unfit welfare system; the situation is also threatening homelessness services that are needed now more than ever," The Independent reports.
Food prices and energy bills have been on the rise since the beginning of 2022, resulting from the invasion of Ukraine . Food prices have risen by 9.1% since last March. This marks a 45-year high. Around the UK, two million adults have admitted they have gone hungry to save money.
Only 5% of Britons can comfortably afford their weekly groceries, according to YouGov. In London, only 13% of people can afford their daily expenses without relying on any credit. At the end of 2022, 20% of low-income people will have relied on benefits or gone without food for six months.
These are just a few statistics that show the reality Londoners face on a daily basis. The fact is that people have become poorer in London and can’t afford to pay the bills. For example, 4 in 10 children in London are now living in poverty. These numbers have become scary and can no longer be ignored by the eople in power, given that London is supposed to be, as the capital, the richest place in the UK.
Turmoil in Parliament
With the rise of Kier Stammer as leader of the Labour Party, the Liz Truss short and chaotic reign and the new rich PM Rishi Sunak, the numbers have not been favourable for another Conservative term. According to a poll taken by YouGov, 34% think it is very likely Keith Stammer will become Prime Minister. According to the data in Politico, 55% of people disapprove of current Prime Minister Rishi Sunak.
Keir Stammer called out Rishi Sunak’s attitude and ignorance of what the average Briton is living through. Rishi Sunak is the richest MP in Parliament and has shown a record of tax evasion, which even his wife was accused of. Keir Stammer accuses him of "smiling his way through the cost-of-living crisis."
Rishi Sunak has promised to tackle this crisis and declared a new strategy to do so. He stated in October 2022 that he would make cuts and raise taxes to raise around £50 billion to fund the government's financial services. This would go to households that are struggling to keep up with the bills.
According to Downing Street, the repayable loan already in place will double to £400. The poorest will receive "£900 in total in three installments in spring, autumn, and spring 2024 to households on means-tested benefits," the BBC reported.
Although Sunak has announced a new policy that allows police to remove beggars from the street that might cause "public distress," especially focusing in London, This has caused concern for charities, given the fact that hundreds will now be in a very vulnerable position with the police mistreating them.
In contrast, Keir Stammer tweeted that his government will "offer to deliver a proper windfall tax on oil and gas profits to stop energy prices rising now, and build homegrown, clean power to keep bills low in the long term."
The Mayor of London, Sadiq Khan, has been addressing the cost-of-living crisis and declared that the government is responsible for passing measurements that will ease the actual crisis in which Londoners are living. Khan has offered a range of suggestions, such as a two-year freeze on rent that would save renters up to £2,988, according to an analysis by City Hall.
As well as initiating an energy ‘Lifeline Tariff’ that would only apply to the most needy Londoners. This will help by giving away the minimum amount of energy needed by certain households so people don’t have to worry about their electricity bills. Another one would be restoring the £20 Universal Credit uplift that was removed by Parliament and causes around 30,000 more Londoners to fall into poverty. This would come with raising benefits that can curve inflation.
However, Parliament has not been able to deliver on any of these actions, and some have been in place since 2019. Politicians seem to be more focussed on the fight of who holds Downing Street between Conservatives and Labour and even between the own Conservatives.
The chaos that came after Boris Johnson resigned and the little time Liz Truss spent in office is still affecting the UK economy, and these distractions have prevented a change in taxes and measurements to help the Britons, especially the Londoners. The power is still in the hands of Parliament, and options are lying in their hands; it is only a matter of time before they take action or let the cost-of-living crisis worsen to record levels.