Cost of living crisis risks leaving levelling up ‘dead on arrival’

By William Eichler | 07 April 2022

The Government’s levelling up agenda could be undermined by a deepening North-South divide exacerbated by the cost of living crisis, a think tank has warned.

Research by the Centre for Progressive Policy (CPP) has revealed that more than half (52%) of the areas most vulnerable to the crisis contain ‘Red Wall’ seats. These include constituencies in places such as Burnley, Sandwell and Hyndburn.

The CPP’s cost of living vulnerability index found that the places to get hit hardest by the cost of living crisis are urban areas of the North, the Midlands and London, and coastal towns, including Hastings, Thanet and Dover.

The index also revealed that less than a quarter of the areas that will receive the most benefit from the Government’s council tax rebate are among those classified by the index as highly vulnerable to cost of living pressures.

CPP is recommending that the Government deliver an uplift in Universal Credit payments to cover the April rise in the energy price cap. This would cost £2.4bn, which the CPP estimates would be £600m cheaper than the rebate policy.

‘Voters on low pay, experiencing food and fuel poverty or pushed out of work altogether, are on the margins of extreme vulnerability – but they are also in many of our most marginal seats. That adds political saliency to the urgent moral case for addressing the cost of living crisis,’ said Ben Franklin, director at CPP.

‘Levelling up slogans will be dead on arrival at the next election unless the Government reconsiders its policy options. Last month’s Spring Statement saw poorly targeted tinkering at the edges of the tax system, whereas our analysis suggests the Chancellor may be forced to reconsider a UC uplift to really help those hit hardest in places like Hartlepool and Hastings.’

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Council Tax Universal Credit inequality Poverty Levelling up