LONDON (AP) 鈥� British food prices rose at the fastest pace since 1980 last month, driving inflation back to a 40-year high and heaping pressure on the to balance the books without gutting help for the nation鈥檚 poorest residents.
jumped 14.6% in the year through September, led by the soaring cost of staples such as meat, bread, milk and eggs, the Office for National Statistics said Wednesday. That pushed consumer price inflation back to 10.1%, the highest since early 1982 and equal to the level last reached in July.
The figures immediately fueled demands that the and retirees as it struggles to regain credibility after an ill-fated package of roiled financial markets. Treasury chief Jeremy Hunt ditched the package after he took office last week, but he has warned that this will be a difficult winter and spending reductions also will be needed.
Glenn Sanderson, head teacher at St. Aidan鈥檚 Catholic Academy in Sunderland, said schools across the country are finding it difficult to feed needy children, with many diverting money from textbooks and classroom teaching to subsidize meal programs. The suggestion of government budget cuts in this environment is 鈥渁ppalling,鈥� he said.
鈥淧arents 鈥� are having to make difficult decisions 鈥� do they pay the bus fare to send their child to education or do they use that money to feed their child,鈥� Sanderson told the BBC. 鈥淚n today鈥檚 society, I find that completely unacceptable.鈥�
Hunt this week told the House of Commons that the government would 鈥減rioritize help for the most vulnerable while delivering wider economic stability.鈥� But he also backed away from Prime Minister Liz Truss鈥� previous commitment to increase pensions in line with inflation.
Downing Street spokesman Max Blain said 鈥渘o decisions have been made鈥� on pension guarantees.
鈥淲e are very aware of how many vulnerable pensioners there are,鈥� but the government is not making 鈥渁ny commitments on any particular policy areas at this point,'' he said.
Russia鈥檚 invasion of Ukraine has around the world, with , and disrupted. That added to price rises that began last year as the global economy started to recover from the COVID-19 pandemic.
While the took the biggest bite out out of household budgets in Britain last month, prices are rising across the board. Transportation costs jumped 10.9%, furniture and households goods rose 10.8%, and clothing was up 8.4%. Housing costs rose 9.3%, driven by the rising price of energy.
The government has sought to shield consumers from the by capping the cost of electricity and natural gas. But Hunt has now limited the price cap to six months, instead of the two years originally promised.
That means inflation is likely to stay higher for longer than previously forecast, said Jack Leslie, senior economist at the Resolution Foundation, a think tank that focuses on improving living standards for low- and middle-income people.
鈥淭his bleak outlook means that family incomes will continue to fall sharply again next year, especially as support with energy bills is withdrawn,鈥� Leslie said in a statement. 鈥淭hat is the context of debates within government about whether previous commitments to uprate benefits or pensions in line with prices should be the next U-turn to be announced.鈥�
Faster inflation also fuels expectations that the and faster as it struggles to return inflation to its 2% target.
The central bank is trying to slow inflation without tipping Britain into recession. The British economy shrank an estimated 0.3% in August after growing just 0.1% in July, according to ONS figures.
鈥淭oday鈥檚 hotter-than-anticipated inflation reading paves the way for another aggressive interest rate increase from the Bank of England at its next meeting in early November,鈥� said Victoria Scholar, head of investment at Interactive Investor. 鈥淗owever, the central bank is between a rock and a hard place as it looks to curb price pressures without inadvertently adding to the risk of recession.鈥欌��
It's the same calculation going on in other countries, but the U.S. Federal Reserve has signaled it will to combat .
The at its meeting next week is expected to make another big increase to curtail record inflation in the 19 countries that use the euro currency. The EU's statistics agency, Eurostat, on Wednesday adjusted eurozone inflation for September down slightly to 9.9%.
Danica Kirka And Jill Lawless, The Associated Press
