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Autumn Statement Live: Jeremy Hunt Cuts National Insurance But UK Tax Burden Set To Hit High Amid Plummeting Living Standards

UK still facing largest fall in real living standards since records began in the 1950sLiving standards are still heading for the worst fall in at least seven decades, despite the cut to national insurance rates announced today, the Office for Budget Responsibility says.

Living standards, as measured by real household disposable income (RHDI) per person, are forecast to be 3.5% lower in 2024-25 than their pre-pandemic level.

While this is half the peak-to-trough fall the fiscal watchdog expected in March, it still represents the largest reduction in real living standards since ONS records began in the 1950s.

The OBR explains:

RHDI per person recovers its pre-pandemic level in 2027-28, something not achieved in our March forecast, as resilient labour incomes begin to steadily outmatch slowing inflation.

We estimate that the reduction in the rate of NICs announced in the autumn statement will boost real household incomes by around 0.5% at the end of the forecast.

Resolution Foundation’s Torsten Bell says Conservative MPs should be worried….

The chart I’d be most worried about as a Tory MP? The disaster of what’s happened to household incomes: 3.5% fall between the last election and the coming one is the largest reduction in real living standards since ONS records began in the 1950s pic.twitter.com/9iJixcnVEJ

— Torsten Bell (@TorstenBell) November 22, 2023

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