10 mini-Budget graphs that expose just how horrifying the cost of living crisis is

Chancellor Rishi Sunak’s Spring Statement had the usual cycle of a glossy sheen giving way to disappointment. But what sets 2022 apart is sheer, horrifying scale of the crisis that is about to hit your family

Rishi Sunak’s Spring Statement has been blown apart by experts who warn 1.3million Brits – including half a million children – will be plunged into poverty.

Every Budget event starts with a preening Chancellor and ends with expert complaints.

But what sets this one apart is the sheer scale of the crisis hitting Brits. whose disposable incomes will see the sharpest fall since records began in 1956.

The millionaire Chancellor promised to help families with skyrocketing prices through a 5p fuel duty cut now, and a big rise in National Insurance thresholds in July.

It’s £11bn of tax cuts – but analysis shows it’s a drop in the ocean, as inflation soars close to 9% and the tax burden still rises overall between now and 2025.

The Resolution Foundation also slammed the Chancellor for giving £2 out of every £3 to the wealthier half, as there’s no new increase to benefits or cash help for energy bills.

Boris Johnson said “it will continue to be tough, it will continue to be chippy, but we will get through it and we will look after people throughout”.

But what do the charts from his own Treasury, watchdogs, and independent think tanks say?

We’ve taken a look at 10 that highlight the enormity of the problems facing the economy…

Inflation is rocketing to a 40-year high

Inflation is due to rocket to 7.4% on average in 2022/23 and could peak at nearly 9%.

The Office for Budget Responsibility said the rise “will erode real incomes and consumption”, slashing GDP growth from a 6% forecast to 3.8% this year.

This graph highlights just how steeply inflation has climbed (red line) beyond what experts thought it would hit five months ago (green line), due to the Ukraine-Russia war.

This will be the highest inflation in the history of the OBR, which was set up in 2010.

This graph from the Office for Budget Responsibility shows the same inflation data but going back to 1970.

It shows inflation will peak above the 8.4% it hit in 1991 and return to levels not seen since the early 1980s.

Disposable incomes will suffer the biggest drop since the 1950s – at least

Brits’ household disposable incomes per person will fall 2.2% in real terms in 2022-23, due to inflation outstripping wages.

That is the biggest fall in a single year since records began in 1956.

And this is even after factoring in £350 support for energy bills, the temporary cut in fuel duty and rise in National Insurance thresholds.

The Office for Budget Responsibility said this help announced since October has offset around a third of the fall in living standards.

This Office for Budget Responsibility graph is an even starker way of portraying the same data.

It shows disposable incomes only fell in real terms in nine years since the 1950s – four of them since the Tories took power in 2010.

And the fall projected for 2022-23 is by far the deepest, outstripping those in the 1970s or the wake of the 2008 financial crash.

Wages are now £11k lower than without the 2008 crash

This shocking chart on wages from the Institute for Fiscal Studies shows the same problem in the starkest way yet.

The experts warned wages are now £11,000 lower than what they could have been if the trend of 1990-2008 had continued.

The financial crash of 2008 still cases a long shadow over politics today.

The national debt wasn’t cut by the Tories

This chart from the Treasury explodes the myth that the Tories brought down ‘ Labour ’s debt’ from the financial crash with austerity.

Net debt shot up due to the bank bailouts and other measures of 2008, but has continued rising since and spiked again due to Covid.

It is still predicted to be 83.1% of the UK’s entire GDP in 2026. And the cost of servicing that debt rockets as inflation rises.

Since the last forecast, the cost of servicing the national debt has risen by more than £40billion in 2022-23 alone.

This chart shows the same data but with a longer timescale, showing how debt was more than double Britain’s GDP after the Second World War – but fell steadily as the decades rolled on.

That falling of debt continued through the 1980s and stayed low until the financial crash. It jumped, then climbed further under the Tories.

Rishi Sunak’s new ‘tax cuts’ do exist – but overall it’s still a tax hike

Rishi Sunak boasted he’d become the tax-cutting Chancellor with cuts to National Insurance, fuel duty and a 1p income tax cut from April 2023.

But the IFS think tank has warned the tax burden will in fact be rising, not falling, overall because frozen thresholds will drag 2.7million more people into paying income tax.

In this chart, the Office for Budget Responsibility finds the Chancellor’s tax cuts barely make a dent in all the tax rises that have been announced in 2019.

The OBR found previously announced tax rises will add 2.2% of GDP to the tax burden – already the highest in decades – by 2026/27.

The freeze on fuel duty, change to National Insurance and 1p income tax cut in 2024 will lower that tax burden by just 0.4%.

This is a different way of looking at the same information on tax.

In this chart, the Institute for Fiscal Studies shows how ‘Illusionist’ Rishi Sunak is in fact raising taxes on Brits – not cutting them.

A median earner on £27,500 will be £360 worse off in 2022/23 than 2021/22 – a £40k earner will be nearly £800 worse off.

Boris Johnson claimed the Chancellor had “cut taxes for working people by, I think, the biggest single amount for the last 25 years.”

The IFS said this is technically true. But IFS Director Paul Johnson said: “He can now expect to raise more in tax as a share of national income by 2025 than he expected last October.

“In fact, taxes are set to rise to their highest level as a fraction of national income since Clement Attlee was prime minister.”

This graph shows just how fast the tax burden has shot up to a record high since Covid.

The OBR warns the tax burden overall will reach 36.3% of GDP in 2026-27 – the highest level since the late 1940s.

That’s up from 33% of GDP in 2019-20. It’s fuelled by rising National Insurance but also in frozen thresholds in income tax until 2026.