Targeted help, such as increased welfare payments, and a VAT cut are among measures the government could consider introducing to tackle soaring food inflation.
In the 1960s, households devoted a third of the family budget on groceries. By 2008, that had fallen to 15%Please use Chrome browser for a more accessible video playerPoorer households spend a higher proportion of their disposable income on essentials, such as food and energy. It means they are bearing the brunt of inflation.
According to a report by the Resolution Foundation, high food and energy inflation mean low-income households are experiencing effectiveIt found that around one-in-five people are eating less or skipping meals. People on the lowest incomes, receiving benefits, and larger families are the most likely to have to do this.
This is a more targeted form of support and eliminates the risk that supermarkets increase prices of non-capped items to compensate for losses under the cap.Jagjit Chadha, director of the National Institute of Economic and Social Research, said:"[It's] much better to think about the households that are having difficulty in paying their household bills and targeting support to them through universal credit.
"If we can get some cash in the hands of those who need it most - those who have lost their jobs - or are without enough income to meet their food bills, that's a much more appropriate way of government policy being designed rather than distorting the price mechanism."
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