Latest cost of living figures show inflation has fallen 0.5%, but remains well ahead of the Bank of England’s 2% target (Image courtesy of ONS)
(CPI/RPI compared, April 2010-present. Graphic courtesy of ONS)
The Office for National Statistics say falling costs of transport, clothing and off-sales alcohol account for most of the decrease.
However, unions say below-inflation rises and pay freezes mean people are getting poorer each month.
The Consumer Prices Index (CPI) measure fell to 3% from 3.5% in March, according to the ONS – the lowest level since December 2009.
The Retail Prices Index (RPI) fell by 0.1% to 3.5%.
TUC General Secretary Brendan Barber said:“Today’s sharp fall in inflation will bring relief to millions of people struggling to keep up with the rising cost of living.
“But with earnings growing by just 0.6%, people are still getting poorer every month.
“We need falling inflation to be matched with far better pay rises to get people’s incomes growing again. This will only happen when our economy is moving in the right direction.”
The ONS says the largest downward pressures to the change in the RPI figure came from alcoholic drinks, clothing, fares & other travel and the purchase of motor vehicles.
Partially offsetting these were upward pressures from housing and petrol & oil, it said.
House prices for first time buyers were on average 2.8% higher than in March 2011.
Today’s figures show prices of newly-build homes rose by 6.9% during the 12 months to March 2012, while the price of pre-owned dwellings decreased by 0.9% in the same period.
UNISON has warned that family budgets – especially for the millions of public sector workers stuck on a pay freeze – are still under huge strain.
General secretary Dave Prentis: “For millions of public sector workers who have had up to three years of frozen pay, it’s a daily struggle to pay the bills, to feed and clothe their families.
“The government must take action to ease this pressure.
“Instead of pumping money into the banks that caused this crisis, it should put money into the pockets of hardworking people.
“Ending the public sector pay freeze would not only help families but would help to get our economy moving again.”
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