27 June 2022

The Chancellor’s statement: “lousy”, “short-sighted” or a “great start”?

Against the backdrop of the escalating cost of living crisis, ministers have been facing calls to do more to help. In his most recent statement, the Chancellorintroduced a levy on energy firms to fund support for families facing rising bills. A centrepiece of his announcement was targeted support to households in receipt of social security benefits - a recognition at least of the particular challenges they currently face. The Chancellor’s cost of living response received mixed reactions from MPs in parliament and this was similarly reflected in the disparity of responses from Covid Realities participants.

For some it was welcome news:

“…Irrespective of timing, I welcome the Chancellor's intervention. He has exercised the political will necessary to counteract the cost of living crisis, albeit temporarily. It remains incumbent on him to maintain financial stability in what remains an unstable world...” [Meg]

As a temporary fix the payment put forward by the Chancellor does not appear to provide any financial security, “we need a more sustainable system that allows people to plan, budget and know what’s ahead of them. Not waiting for cash payments” [Teddy].

The cost of living crisis means the prices of everyday essentials such as heating costs, food and fuel are rising faster than average household incomes. For many, the Chancellor’s statement was bittersweet; it helps to reduce some, but certainly not all, worries.

“I just feel better as winter looms I won't be dreading the beep of the meter, I'm still struggling to pay the internet and other household bills, at this stage anything is better than nothing.” [Louise]

Some participants expressed little belief that the package will make a difference to the struggles they are facing currently, with support offered insufficient to not eradicate concerns about the future: “Three hundred pounds will get me some oil, it won’t last long though and truly won’t change my circumstances because I still have to deal with the rising cost of food and other things…” [Teddy]

In the current climate, some have become disillusioned by political promises and there was a lack of trust by many. As Jo put it, “why should we believe anything they say when they are proven liars?” In her blog for Covid Realities, Jo explained in greater detail why she believes the measures to be a false economy, and far from a long-term solution. She also explains that she expects the measures to be followed by backlash and retraction:

to me this feels as temporary as the universal credit uplift. It will be taken away, and then it will be next year and people will shout at us and humiliate us for not managing our ‘free money’ better. We hear a lot about economic recovery. But if you haven’t got longevity and consistency in your income we cannot expect our households and communities to recover. This is just not enough.

People on benefits are used to being the targets of stigma and media scorn, this makes them nervous about a backlash when they are perceived as ‘winners’ in the package of support being provided. Subsequently, they may feel pressure imposed on them to show gratitude, despite experiencing financial hardships. However, others expressed a much more optimistic view focusing on how the proposed changes will alleviate pressures.

“It's really a very good news for us. Looking forward to getting this money in my pocket to cover up some extra cost in this worse time of our life.” [Erik1]

As is reflected in the responses collected, this optimism is juxtaposed against the difficulties that people have faced and expectation that this will continue. Unfortunately, even for those pleased at the Chancellor’s recent statement, skipping meals and taking desperate measures to avoid using their heating systems at home will still remain an everyday reality.

“For myself and my daughter this will mean that we can finally keep our home warm during the winter and also if we are careful not to use the extra money unnecessarily we may even be able to buy some healthier fresh food. Like I say this will not be an end to the struggles that so many families face, but is a good start.” [Erik2]

It provides an answer to the question: did the Chancellor go far enough?

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