UK Households Face £1,050 Income Drop by 2029 as US-Iran War Lifts Inflation
Updated
Updated · bbc.co.uk · Oct 29
UK Households Face £1,050 Income Drop by 2029 as US-Iran War Lifts Inflation
2 articles · Updated · bbc.co.uk · Oct 29
Summary
Typical working-age households will see disposable income fall by £1,050, or 3%, by 2029, the Resolution Foundation said, warning of "painful" years as living standards stall.
The OBR blamed the squeeze on higher borrowing costs and inflation linked to the US-Iran war, cutting its 2027 GDP growth forecast to 1% from 1.2% for 2026 and raising 2027 inflation to 3.4% from 2%.
John Healey's Budget includes a £100 energy payment for about 20 million households, but the think tank said that support would still leave bills higher than in the 2022 energy crisis and should have been more targeted.
The IFS said the 2020s are on track to be the worst decade for household income growth on record, while the OBR sees living standards for all households rising by less than 0.1% a year by decade-end.
Opposition parties and the IFS also warned the Budget leaves public finances fragile, with tight spending plans and frozen tax thresholds adding to pressure on take-home pay.