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The press release issued by the IEA on 19 October 2022.

Commenting on the latest ONS inflation data, Christopher Snowdon, Head of Lifestyle Economics at free market think tank the Institute of Economic Affairs, said:

“Double digit inflation in September is what was expected and it will get worse before it gets better. It is particularly concerning to see food and soft drink inflation at nearly 15 per cent.

“In real terms, interest rates are currently at minus eight per cent. The Bank of England keeps saying that it will not hesitate to raise rates and yet it consistently does far too little far too late.

“The two per cent target is laughable. This inflation is clearly not transitory. People will continue to see their salaries and savings eaten away until the Bank of England starts taking it more seriously.”

The press release issued by the IEA on 17 October 2022.

Commenting on Chancellor Jeremy Hunt’s statement, Mark Littlewood, Director General at free market think tank the Institute of Economic Affairs, said:

“The Energy Price Guarantee was always an unnecessarily expensive programme, representing perhaps the single biggest welfare scheme in British history. As many of us said at the time, it is absurd to subsidise wealthy households to keep heating their swimming pools. A more targeted approach from next year is warmly welcome and will save significant money.

“There is a clear need to improve the government’s fiscal position to calm the gilt markets – it’s disappointing, however, that so much of the heavy lifting will come from higher taxes. The central lesson from this episode is that the government cannot keep living beyond its means.

“The risk of raising taxes is that they put Britain back on the path towards a high tax, low-growth economy. As Goldman Sachs warned yesterday, higher corporate tax rates could deepen any forthcoming recession and ultimately damage the government’s fiscal position.

“The Chancellor has said it was irresponsible to fund tax cuts through debt. However, we must also end the fiction that we can keep funding day-to-day public spending through debt forever more as well. The government may have abandoned much of the central tax elements of their growth strategy, but that makes it even more important to get on with regulatory reform.”