Boris Johnson defends cost of living response amid calls for moreon May 3, 2022 at 11:54 am

Boris Johnson has conceded current government help to ease the cost of living is not enough, but said further action now could make things worse.

The prime minister acknowledged “there is more that we can do” to help families struggling with rising fuel and energy bills.

But he said it was important to do this over the “medium to long term” to not make inflation even worse.

Labour accused him of offering “no answers” to a “cost of living crisis”.

Political parties are arguing over living costs, ahead of local elections in England, Wales and Scotland, and for Northern Ireland’s government.

Inflation is at a 30-year high of 7%, driven upwards by surging food and energy prices, and is expected to rise further later this year.

The government has announced a council tax rebate and repayable discount on energy bills, but is facing calls to go further now to help with costs.

It has also faced criticism that the 3.1% rise in the state pension and other benefits is not keeping pace with inflation.

Asked about rising prices on ITV’s GMB programme, Mr Johnson initially said the government was “doing everything we can” to help households.

But pressed on whether the response went far enough, he later said the taxpayer-funded response “isn’t going to be enough immediately to help cover everybody’s costs”.

“Of course that isn’t going to work enough in the short term,” he added.

“There is more that we can do but the crucial thing… is to deal with the prices over the medium to long term,” he added.

But asked whether there should be a more generous uplift to benefits, he warned this brought the risk of triggering an “inflationary spiral”.

He added: “We have a short term hit caused by the spike in energy prices across the world.

“If we respond by driving up prices and costs across the board across the board in this country, responding by the government stepping in and driving up inflation, that will hit everybody.

“And that will mean that people’s interest rates on their mortgages go up, the cost of borrowing goes up, and we face an even worse problem.”

Opposition parties have suggested hiking taxes on oil and gas companies to pay for bigger support payments to help households with energy bills.

They have renewed their calls on Tuesday, after BP announced its profits for the first three months of this year have more than doubled.

Liberal Democrat leader Sir Ed Davey said the news made the government’s unwillingness to impose a windfall tax on energy firms “impossible to justify”.

But Mr Johnson rejected a windfall tax on energy firms in his ITV interview, arguing it would discourage investment from private firms in renewable energy projects.

Speaking to the BBC, Labour leader Sir Keir Starmer said BP’s profits announcement “reinforces the case” for a windfall tax.

Asked whether it might deter investment, Sir Keir said his party’s proposal was for a year-long tax increase on “profit they didn’t expect to make”.

He criticised the government’s response, saying: “Overall, the cost of this government is that families will be £2,000 worse off and the government’s got no answer to that for so many families.

“The national insurance rise is going to hit working people in the middle of a cost-of-living crisis.”

Elsewhere from his interview, Mr Johnson faced criticism from Labour for his response to a question about the situation of 77-year-old widow.

Presenter Susanna Reid said Elsie, a GMB viewer, had resorted to using her London Freedom Pass to ride on buses “all day to avoid using energy at home”.

In his reply, the PM claimed credit for introducing the pass – which gives pensioners and others discounted travel – when he was mayor of the capital.

Shadow work and pensions secretary Jonathan Ashworth said his reply showed “just how out of touch this narcissistic prime minister is”.