RACHEL Reeves has rejected data from a leading poverty charity which suggests the average family could be £1400 a year worse off by the end of the decade.
The Joseph Rowntree Foundation (JRF) research shows that the living standards for the poorest third are forecast to drop twice as much compared with middle and high earners, though everyone is expected to become worse off.
The charity, which conducts research into reducing poverty, added that it believes the UK Government will miss one of its stated “milestones”, to raise living standards across the UK before the next election.
Alfie Stirling, director of insight and policy at JRF, said Labour risks presiding over “a rapid rise in inequality” and becoming the “first parliament on modern record to see a fall in average living standards from start to finish”.
The prediction could be bleaker for some as JRF's analysis doesn't account for the recently announced £5bn in cuts to welfare.
However, the Chancellor rejected the prediction when she was asked about the JRF’s report forecasting the drop in living standards by the end of this parliament.
Reeves told Sky News’ Sunday Morning with Trevor Phillips: “I reject that and the Office for Budget Responsibility will set out their forecast this week.
“Living standards in the last parliament were the worst ever on record.
“I’m confident that we will see living standards increase during the course of this Parliament, what we’ve already seen in these last few months of the Labour Government is a sustained increase in living standards.”
Labour chancellor Rachel Reeves rejects the Joseph Rowntree Foundation report that shows British families will become poorer over the next 5yrs & that the poorest families will fall even further behind. Instead Reeves is "confident" living standards will increase #TrevorPhillips pic.twitter.com/mjiD72pemS
— Saul Staniforth (@SaulStaniforth) March 23, 2025
JRF said it came up with its prediction by modelling forecasts from the Bank of England along with others and also conducted a poll of 5000 people with YouGov.
The charity also called the UK Government’s welfare cuts “wrong” and counterproductive adding it wants the plan scrapped while also urging for a new “minimum floor” for Universal Credit to help address hardship.
JRF believes the Labour government should raise cash by increasing tax on wealth and investments instead of raiding disability benefits.
The report comes days before Reeves' spring statement in which more cuts are set to be announced.
Some £1.5bn in cuts to the civil service are also expected to be announced by Reeves but it's understood they won't affect front-line services.
