Energy prices and rate of inflation

Commenting on newspaper reports today that there are fears that rises in energy prices could push up the rate of inflation, Graeme Francis, Head of Policy and Public Affairs at Age Cymru says:

"The lower rate of inflation recorded in September is very much a mixed blessing for older people living on fixed incomes. 

"Generally pensioners are some of the people hit hardest by increasing inflation because they tend to spend a greater proportion of their income on essential goods such as food and energy - in that context, lower inflation is good news.

"However, it is a cruel twist that CPI has dropped to 2.2% at this time, because the September figures are generally used by the Chancellor to calculate changes to the level of the state pension and other benefits for the following year - CPI has averaged 3.3% over the past 12 months.

"These figures will also not reflect the reality for many people who will be affected by the major increases in energy prices announced in the past few days which will mean that fuel bills will rise over winter when people need to use their heating to keep warm.

"Reports have also recently pointed to highly likely increases in food prices in the coming months.

"We need concerted action by governments in London and Wales to tackle poverty amongst older people and to help people to manage the rising costs of essentials."