Olivia Courtney, Andrew Forsey, David O’Sullivan, Daniel Sanchez
The immediate economic and political context behind the Budget, on 28th October, will become painfully clear from successive weeks’ headlines leading up to this most significant moment.
But what of the longer-term trends in household budgets which add deeper social context to the Budget, particularly among those who are at risk of hunger and food insecurity?
Using data from the House of Lords Library, we have been analysing those trends and, having done so, submitted to the Treasury a series of anti-hunger proposals for consideration in the Budget.
What stands out is the big increases, between 2017 and 2025, in the combined proportion of household expenditure taken up by the three essentials of housing, energy, and food (an increase of 4.8 percentage points for all households).
The poorest 40% of households registered an increase that was larger than that for all households (5 points for decile one, 5.8 points for decile two, 5 points for decile three, 6.1 points for decile four). The opposite is true for the richest 30% of households (4 points for decile 8, 2.5 points for decile nine, and 3.3 points for decile 10).
Practically the whole of that increase for the poorest 40% was driven by housing (4.9 points for decile one, 5.3 points for decile two, 4.4 points for decile three, 4.1 points for decile four), followed by energy, which for all too many has led to a reduction in expenditure on food.
As has long been the case, food represents the softest and most flexible item of the household budget which gets squeezed by housing and energy. While a family gets into trouble if they miss the rent, or don’t pay the bills, nobody comes after them if they cut back on food and go without meals.
Between 2012 and 2025, the poorest 30% registered the largest reductions in food, as a proportion of overall expenditure, perhaps to compensate mainly for higher housing costs: for food there was a reduction of 1.4 points in decile one, 2.8 points in decile two, and 2.6 points in decile three. For all households the reduction was 0.7 points, and reductions were much smaller among the richest 30% (1.3 points in decile eight, 0.2 points in decile nine, 0.5 points in decile ten).
Given these bamboozling increases in housing costs, as a proportion of household expenditure, we have proposed in our Budget submission that the Government reforms the Local Housing Allowance so as to offer much stronger protection for private renters with low or modest incomes. We have also asked both for an immediate benefits fix – reforming the five-week wait to process and pay a new claim for Universal Credit – to be accompanied by a longer-term piece of reform, with the introduction of Unemployment Insurance, as a means of strengthening the protection for people losing work and suffering an income shock.
Looking specifically at food budgets, one way of increasing the purchasing power of the poorest families, with the youngest children, would be to reverse two decades’ worth of cuts that have been inflicted on the NHS Healthy Start allowance which, as things stand, is worth less than it was 20 years ago. A reversal of those cuts would add directly and significantly to the food budgets for poorer families.
And, finally, we know that strong free school meals and school holiday programmes can ease much pressure on household budgets, hence our two proposals for addressing the current weaknesses with these programmes which prevent their being fully effective.
Not only would our proposals tackle the injustices emerging from the data above, but they would give poorer households a fighting chance of getting through the months ahead without suffering a heightened risk of hunger and food insecurity.