LONDON: The UK government came under pressure on Monday (8 August) to immediately come up with plans to support families through a growing cost of living crisis, a leading business group and former prime minister claiming that a political vacuum cannot last.
The Bank of England warned on Thursday that a long recession was on the way as energy prices hit unprecedented highs, pushing inflation to a 40-year high of 9.4% in June and leaving many many households on the brink of economic hardship.
But the political response has been stalled by the race to replace Boris Johnson as prime minister after he was forced to step down over a series of scandals. While he remains in office, he has recently been on vacation and his successor will not be announced until September 5.
Former Labor Prime Minister Gordon Brown and the Confederation of British Industry (CBI) have said the country can no longer afford to wait for a new leader, and that action must be taken now before oil prices energy did not jump again by 70% in October.
Brown, the country’s finance minister for 10 years from 1997 and prime minister from 2007 to 2010 during the financial crash, said many households were facing an economic time bomb.
“Take action this week and address these multiple issues that constitute a national emergency,” he told LBC Radio. “You don’t wait for the crisis to hit you in October and then say you’re surprised.”
The CBI agreed, urging the Prime Minister and Finance Minister to prevent a “summer of drift” by meeting the two candidates to replace Johnson – Foreign Secretary Liz Truss and former Finance Minister Rishi Sunak – and to agree on a way forward.
UK energy regulator Ofgem will publish its new domestic price cap for households on Au. 26.
“We simply cannot afford a summer of government inactivity while the leadership race unfolds, followed by a slow start for a new prime minister and a new cabinet,” said Tony Danker, director general of the CBI, in a statement.
Johnson’s spokesman said it would be up to Britain’s next leader to decide whether further support was needed and the government had already put in place a funding scheme to help people this winter.