SOARING milk, cheese and egg costs have pushed food inflation to its highest level for 14 years, with millions of UK families heading into the winter in ‘food poverty’, with no prospect of prices coming down.
Coupled with the soaring energy prices, the choice between eating and heating is the reality now facing millions of households.
Falling petrol and diesel prices meant the overall inflation rate eased slightly but it remains near a 40-year high, official figures showed yesterday.
But soaring costs are eating into household budgets, with prices rising further than wages.
Overall UK inflation, which measures the rate at which prices rise, eased for the first time in almost a year in August, slipping to 9.9% from July’s 10.1%.
But economists warned that the inflation rate will continue to rise, noting that the cost of food , clothing and services – which include things such as shop and restaurant prices – were all continuing to rise sharply.
The Bank of England has warned inflation could top 13% this year, and is expected to keep raising interest rates.
Kitty Ussher, chief economist at the Institute of Directors said she expects interest rates to go up when the Bank of England announces its latest decision next Thursday.
‘The fact that the falling headline rate is due to changes in the price of petrol and diesel, which is driven predominantly by the international price of oil rather than by domestic factors, means news is unlikely to alter expectations of a rise in interest rates.’
Food prices rose over the month of August, by the highest rate since 1995, driven by basics such as milk, cheese and eggs.
The Bank had been widely expected to increase rates again today, but it postponed that decision following the death of the Queen.
The Monetary Policy Committee’s decision will now be announced on 22 September.
Commenting on the ONS inflation figures released yesterday, Unite general secretary Sharon Graham said: ‘Rocketing inflation may have been eased last month but that won’t last.
‘Current levels continue to threaten the living standards of millions of workers. This is now a crisis of income.
‘Only the rich and powerful are protected. It’s time for the rest of us to organise into trade unions and take back our share of the corporate profits we create.’
Now that the TUC Congress has been recalled it must be forced to call an indefinite general strike to bring down the Tory government and bring in a workers government.
This will nationalise the banks and all the major industries, including the energy industry, and place them under workers control as part of a socialist planned economy.